Buffs forecasting a deficit of nearly $20 million for the 2021 fiscal year.
B OULDER» Colorado’s athletics department is projecting a drop of about $43 million in revenue from last year, while forecasting a deficit of nearly $20 million for the 2021 fiscal year.
A surplus from the 2020 fiscal year and playing a partial football season in the fall has kept those numbers from being much larger, however, as CU and other athletic departments around the country continue to navigate the impact of the COVID-19 pandemic.
CU closed the 2020 fiscal year last summer with $89.987 million in revenue and $86.291 million in expenses. The challenges of the pandemic have led to CU’s budget remaining fluid throughout the 2021 fiscal year, which began in July. CU is currently budgeting for $65 million in expenses and $46-47 million in revenue.
Most of CU’s year-over-year revenue drop can be attributed to ticket sales and conference distribution. Between football and men’s basketball, CU had $23.25 million in ticket revenue for 201920, but hasn’t been able to host fans this year. In addition, athletic director Rick George said the Pac-12 distribution this year could be 50-60 percent of the $32.6 million CU got last year.
“That gets your revenue down significantly, just in those two numbers; there’s $40 million,” George said. “But, we’ve done a good job in the other areas. Our fundraising is going really well, and our partnership with Nike and Learfield IMG for Buffalo Sports Properties for multimedia rights has been good and solid. So we’re hanging in there.”
CU’s current budget of $46-47 million in revenue includes profor jected revenue from the NCAA basketball tournament. Should COVID-19 cause a cancellation of the NCAA Tournament, as it did in 2020, CU’s revenue would drop by another $1 million or more.
Even in a best case scenario, however, CU is bracing for a net loss of nearly $20 million for the 2021 fiscal year.
CU will utilize the loan program being set up by the Pac-12 for COVID-19 relief.
Cory Hilliard, CU’s senior associate athletic director of business operations, said the repayment plan has yet to be determined, but it would be leveraged against future conference distribution. He said CU would likely borrow $2025 million this year, but will also look to mitigate costs through cash reserves and donations.
“We’ll only borrow what we need,” Hilliard said. “However, we’re not going to put ourselves in a position where in 2022 we
run into another unexpected hiccup and need additional cash.”
CU finished the 2020 fiscal year with a designed surplus of $3.67 million, most of which is attributed to the buyout of former head football coach Mike MacIntyre, who was fired with one game to play in the 2018 season.
For accounting purposes, all of MacIntyre’s $7.238 million buyout was attributed to the 2019 fiscal year, leading to a $3.696 million deficit that year. In turn, it led to a surplus in 2020.
The final quarter of the 2020 fiscal year was impacted by the start of the COVID-19 pandemic, causing CU to lose out on roughly $1.5 million when the NCAA basketball tournament was canceled and having a lower amount from Pac-12 distribution.
CU’s bottom line in FY20 was helped, however, by former head coach Mel Tucker bolting for Michigan State in February. Tucker had to pay CU $3 million terminating his deal early. CU also saved money during the final quarter of FY20 when sports were canceled, because it eliminated some travel, recruiting and game operation costs.
In preparing for a difficult 2021 fiscal year, CU cut expenses with layoffs and furloughs, as well as salary reductions for some coaches and administrators. The Buffs also eliminated some expenses associated with team travel, recruiting and game operations.
At the start of the fiscal year, CU had a budget of $72.6 million, based on a possible 10-game football season – with the hope of being able to sell some tickets and collect ancillary revenue through concessions, parking, etc.
CU’s budget has remained fluid, however, and was modified when the Pac-12 settled on a shortened, seven-week football season without fans.
“Playing football was helpful and basketball season is going along,” George said.
He added that the budget remains fluid, because, “We really don’t know where basketball is going to end and what’s going to be the NCAA distribution, and how many games we are going to play.”
While football was played, each Pac-12 game that was canceled cost the conference about $5 million in lost TV revenue (about $416,000 per team). The conference lost 10 games in all, cutting out roughly $4.1 million in revenue for each team.
CU will make a small profit from playing in the Valero Alamo Bowl, however. Hilliard said CU received a distribution share of about $900,000 for playing the game and once expenses are finalized, “I expect that we’ll net somewhere around $100,000.”