UConn athletic department deficit larger now than ever

Six years ago, in April 2017, UConn’s senate budgetary committee released a report deriding the school’s athletic department finances as “unsustainable” and calling for officials to drastically reduce the department’s budget deficit by 2022.

Two years later, when the situation had only worsened, a university spokesperson acknowledged the deficit and said the school hoped to “move athletics closer to financial self-sufficiency” in the near future.

The following year, after the deficit had grown again, officials said the school’s recent conference change had complicated the situation but that its annual athletic department subsidy would begin decreasing in 2021. Months later, the school announced it would cut four sports and reduce operating expenses across athletics, with the goal of shrinking the subsidy 25 percent by 2023.

Then last year, with the subsidy now larger than ever, the athletic department pledged to shave more than $10 million off its deficit in the coming fiscal year.

And yet on Tuesday, UConn athletics’ financial statement for the 2022 fiscal year showed the department’s largest deficit ever: $53 million, covered by $46.5 million in “direct institutional support” and another $6.5 million in student fees.

Despite all those promises, UConn continues to rank among the athletic departments nationally with the greatest gap between expenses and revenues, even after changing how it calculates scholarship costs to make its deficit appear less severe.

In an interview Friday, athletic director David Benedict noted that the 2022 subsidy would have shrunk if not for a large payout to former men’s basketball coach Kevin Ollie. He suggested that expenses covered by student fees shouldn’t count toward the deficit because those fees allow students to attend games for free, in lieu of having to buy tickets. He said the athletic department will continue to work to cut costs and increase revenue where possible.

But Benedict also defended spending significant money on athletics, arguing that successful sports teams build UConn’s brand, draw eyes to the school and stir state pride. He argued that UConn’s budget deficit is inevitable for an athletic department that strives to compete nationally across numerous sports without belonging to a major conference or fielding a high-revenue football team.

“The idea that we’re going to be able to eliminate the subsidy under the current circumstances is not realistic or practical,” Benedict said. “So yes, there’s always going to be a reliance on the university as long as the current set of circumstances with conference and media rights and all of those types of things stay the same.”

How did UConn get here? Why have years of promises to reduce the athletic department subsidy have proven so difficult to keep, to the point where the status quo appears here to stay? Here are a few of the reasons.

Conference woes

Conference realignment was a primary reason UConn fell into its current financial situation last decade, and it remains a major factor today.

The problem began in earnest in July 2013, when the old Big East Conference disintegrated and UConn was left in a mishmash known as the American Athletic Conference. The Huskies still had a major conference budget but were suddenly stuck with small-conference revenues in key areas such as media rights.

UConn eventually left the AAC for a reconstructed version of the Big East in 2020, a move that may eventually pay off financially for the school. But since the new Big East doesn’t sponsor FBS football, the media revenue its schools receive will never approach that of majorconference schools.

In the SEC and Big Ten some schools receive more than $50 million annually from media rights, bowl payouts, NCAA championships and more, with Pac-12, Big 12 and ACC schools not too far behind. UConn, by comparison, generated about $3.5 million in those categories during the 2022 fiscal year.

Football in flux

There’s another pretty massive difference between UConn and the major-conference schools with self-sufficient (or nearly self-sufficient) athletic departments: football.

At least until this past season, UConn’s football program endured a fairly disastrous decade, full of underperforming coaches, lopsided scorelines and plummeting attendance. And while a highly successful football program can earn a school millions of dollars while boosting spirit and drawing national headlines, an unsuccessful one accomplishes none of the above — but still costs plenty in scholarships, facilities, coaching salaries, travel and more.

“Football is what drives the majority of revenue in college athletics for most large college athletic programs,” Benedict said. “They have stadiums with seating capacity of between 80 and 100,000 people, they fill and sell out those stadiums, and they charge a significant amount for tickets and generate a lot of donations to have the right to sit in those seats.”

UConn’s football program, of course, does not sell out a massive stadium, or even its modest one, and instead operates deep in the red year after year. In the 2022 fiscal year (which included the 2021 football season), UConn football generated $4.7 million in revenues while costing $18.4 million in expenses.

No other sport contributes nearly as much to the athletic department’s deficit.

The cuts that didn’t come

In June 2020, UConn signaled it was serious about spending less on athletics with the announcement that the school would cut four sports — women’s rowing, men’s swimming and diving, men’s cross country and men’s tennis — thereby saving money on scholarships, travel, coaches’ salaries and more.

Of those four sports, rowing was by far the most expensive, costing as much as $1.5 million a year while bringing in almost no operating revenue, financial statements show. Cutting the program would mean seven-figure savings.

There was one problem: Cutting women’s rowing would risk violating Title IX, the federal statute that requires schools provide equal opportunity to male and female athletes. After members of the rowing team filed a Title IX lawsuit, the university agreed to a settlement that would not only preserve the rowing program for an additional five years but also add scholarships, improve facilities and an increase the team’s recruiting budget.

UConn did cut men’s swimming and diving, men’s cross country and men’s tennis, as promised, but rowing endures — and was the school’s seventh most expensive program during the 2022 fiscal year.

Maintaining the rowing program certainly isn’t the largest reason UConn remains in a difficult financial situation, but the saga demonstrated how difficult (and sometimes ugly) cost-cutting can be.

Pandemic problems

One factor entirely out of UConn’s control was the COVID-19 pandemic, which cost the school March Madness payouts in the spring of 2020, halved advertising revenue and caused ticket sales to nosedive from $8.9 million in the 2020 fiscal year to only $106,052 in the 2021 fiscal year. These losses were offset only somewhat by the cancelation of the Huskies’ 2020 football season, which resulted in savings on travel and in other areas.

It was no surprise, then, that the athletic department’s subsidy reached a new high in 2021, even after the department began “charging” itself less for athletic scholarships, a maneuver that reduced the deficit on paper by about $4.5 million. For one year, at least, it was difficult to fault

UConn for falling deeper into the red.

In the 2022 fiscal year, the athletic department earned $9.7 million in ticket revenue, more than ever, and saw advertising return to nearly its prior level, suggesting that the pandemic effect had largely faded. Still, Benedict noted that the crisis had residual effects during the 2021-22 school year, such as canceling a women’s basketball home game and likely deterring some fans from attending other events.

Payouts to coaches

As Benedict points out, UConn’s deficit in the 2022 fiscal year was inflated by a one-time, $13 million payment to Kevin Ollie, the basketball coach who was fired in March 2018 and fought a years-long legal battle to compel UConn to pay the money that remained on his contract.

If not for the payment to Ollie, UConn would have been able to claim its athletic department subsidy had decreased by about $7 million from the COVIDplagued 2021.

But while the details of Ollie’s situation (and the size of his payment) were unusual, this was hardly the first time UConn has paid big money to coaches who no longer worked for the school. The firing of football coach Bob Diaco less than a year into a fiveyear contract cost UConn more than $5 million in 2017, and the school paid an additional $2.3 million in severance to coaches and administrators in the four succeeding years, financial statements show.

In recent years, at least, payouts to departed coaches have been part of life in the UConn athletic department.

Ultimately, even without the payment to Ollie, UConn still would have reported an athletic department subsidy of about $40 million, in line with pre-pandemic years. The Ollie payout, like COVID the year prior, contributed to the department’s financial situation but certainly didn’t explain it.