AG seeks info on rent owed for VIP suites at UNM’s Pit
Probe comes as athletic department faces overhaul to curtail overspending
ALBUQUERQUE — State Attorney General Hector Balderas on Tuesday asked The University of New Mexico for documents regarding uncollected rental payments for VIP suites at its basketball arena as his office’s investigation into athletic department finances at the state’s flagship university deepened.
Balderas sent a letter to acting UNM President Chaouki Abdallah seeking the contracts of all suite holders since the 2010-11 season, as well as invoices the school sent to them. Balderas also requested any records related to the use of revenue from suite sales.
The action comes on the heels of the university’s announcement Monday that the athletic department has yet to collect $432,000 from rentals of 24 suites since those amenities were added during a 2010 remodeling of what is now formally known as Dreamstyle Arena but commonly referred to as The Pit.
Abdallah also revealed Monday that Chris Vallejos, UNM’s vice president for institutional support services, will assume oversight of the department’s finances. Vallejos said Tuesday he plans to impose sweeping new policies
aimed at bringing a halt to overspending by a department that built up a deficit of more than $4 million over the last decade.
It’s all part of an unsettling financial landscape for a department with sports teams that serve as a major bridge between the university and its alumni and the surrounding community but that struggle to compete in the high-profile world of college athletics.
In May, it was revealed that the department’s director at the time, Paul Krebs, had spent more than $63,000 in school money on an ill-advised fundraising golf outing to Scotland and paid for the trips of at least three boosters. The scandal was followed by Krebs’ resignation June 1.
In April, UNM fired head men’s basketball coach Craig Neal despite owing him a $1 million buyout on his contract. The men’s basketball program also was under investigation for alleged misuse of a purchase card by Cody Hopkins, then the director of basketball operations, who an internal audit accused of embezzling $63,000 from the program during the 2015-16 season.
Ongoing deficits prompted university administrators in 2016 to inform Krebs that he could no longer allow the department to run in the red.
That is the environment inherited by Vallejos, who said Tuesday that not everyone will be happy about the changes he plans to institute in an effort to fix the department’s financial hemorrhaging.
“There’s probably going to be some very challenging organizational and cultural things that we’ll probably have to make happen over the course of the next few months,” he said, “but that’s my job to go in and do that.”
Vallejos said he plans to take up to three months to make recommendations to athletic administrators and coaches. He expects it will take at least another three months to implement new policies.
Collecting on unpaid debts is just the start, Vallejos said.
“The whole gamut of business is done by a number of people at the athletic department, and that’s the challenge,” he said. “The challenge is to get people to know and to understand and be aware of the fiscal impacts that happen to a budget with the decisions that you’re making.”
The game plan for fixing things, Vallejos said, is simple. He and a staff of two to three others from the Institutional Support Services office — including a payroll specialist and a human resources representative — will spend the next four to five weeks assessing the department’s internal controls, learning how the budget works and looking at three-year trends.
Next will come a series of recommendations, some small and others so large they’re sure to create ripples of discontent among the coaches and support staff. Aside from questions surrounding the suite rentals, Vallejos pointed to overspending by coaches for uniforms, travel and equipment. He suggested that scheduling cuts in some nonrevenue sports, like baseball and soccer, could be a possibility.
Attempts to reach acting athletic director Janice Ruggiero for comment Tuesday were unsuccessful. During Monday’s hastily assembled news briefing, she asked for understanding from Lobo fans as the school attempts to repair the damage.
Vallejos said some programs use multiple styles of uniforms, and he saw that as a potential target for trimming unnecessary expenditures. The football team has worn multiple sets of helmets and uniform designs the last two seasons, while the men’s and women’s basketball teams have sported several different looks.
A football helmet can cost $300 or more. Toss in new logos, face masks and numbering, and the expense for an entire team can run in the tens of thousands of dollars — and that doesn’t even include the jerseys, pants and socks.
Add in the fact that several sports have multiple uniform combinations, and the costs begin to escalate quickly. It gets even worse when travel is factored in if a team takes a chartered flight to an out-of-state game.
“I think what’s happened in athletics, in NCAA athletics across the country, coaches and their administrators are so competitive,” Vallejos said. “They stay focused on being competitive, and if they don’t get their equipment money and don’t get their uniform money, if they don’t get their traveling and recruiting money, they kind of say, ‘Well, we’ll spend it, but you administrators go find it.’ ”
Conference alignment also complicates athletic department finances. For example, the men’s soccer program participates in the far-flung Conference USA. Last year alone, the Lobos had road trips to South Bend, Ind.; Irvine, Calif.; Lexington, Ky.; Charlotte, N.C.; Denver, Boca Raton, Fla.; Birmingham, Ala.; and Huntington, W.Va.
Then there’s the long-held practice of having athletes report to campus early.
“For instance, they’re now requiring the athletes to come in five days before the fall semester,” Vallejos said. “Well, for these athletes, we don’t have anything in our budget where we have to feed them, house them, take care of them for five more days. That can add $40,000 or $50,000 that we didn’t know was happening when we built our budget three or four months ago.
“Those are the things that we need to learn and understand what the financial impact is on all these decisions that are made, whether it’s in our state, whether it’s at the NCAA or whether it’s in the university.”
Where Vallejos’ involvement leads him is anyone’s guess, but he does have experiences to draw upon. In his more than 30 years of service at UNM, he has had his hand in similar situations. Years ago, Vallejos said, he was tasked with confronting a financial crisis at KNME, the university’s PBS-affiliated television station.
He spent 14 months digging into the books and oversaw recruitment of a new CEO and a staff overhaul. The station is now on healthy footing.
New Mexican Sports Editor James Barron contributed to this report.