Universities everywhere are having to make tough financial

110%er [6825]

TigerPulse: 100%

Posts: 6350

Joined: 7/20/18

Re: Universities everywhere are having to make tough financial

Sep 4, 2020, 12:24 PM

Athletic generated revenue does not go into the general coffers.

Much of the school financial items can be traced into a couple different spots.

First, Covid-related prep has cost a LOT of money. While there has been some effort to distribute various relief money, it generally has not been enough. Even then, it is reimbursed and you might not have a lot in case to begin with.

In many states, the support to a school is based on enrollment. Thus if a school sees a decline based on enrollment, they would receive less funding. Thus a school propping for 10,000 students only getting 8,000 students would result in a 20% loss. Still, the school had to plan and spend for 10,000 in their prep in july, etc. In some cases like my former school/employer their enrollment went up slightly as more kids "stayed home" that traditionally go to other universities as it was felt to be a "safer" choice. (aka a small school with 8,000 vs a large school with 25,000+)

Next, with tuition caps by various legislatures - tuition isn't what keeps a lot of the light going. Much of that is brought in by fees or housing/service revenue. Student fees have been a point of concern. Thus if a University took out a load to build a residence hall 3 years ago and needed an occupancy rate of 70-80% to cover, if their Covid occupancy rate is 50%, they are losing money. Worse, the University can't jut default. As a result, it has to pull in general revenue sources to bail out that loan. Worse, a lot of non-faculty (aka the staff doing the actual work) are funded via student fees. They are still state employees so it isn't like the school could just lay them off, as their salaries could/would be covered by general funds again. Think about this, when I was staff, I was both a fee-funded position but also marked as essential. See the enrollment/fee related budget issue? I would have been critical in my covid-response but my funding would be at risk. Thank gooodness I changed jobs into a more secure spot in Jan.

However, housing is easy, parking is harder. In my state, you can't use ANY tuition or state dollar to cover parking deck cost. It has to come from parking permit sales - only, no exceptions. If you also took out a loan to build a parking deck, expecting to sell 1000 $400 permits, ($400,000) and you only sell 250, where does that money come from? Can the state default? nope. Can you shuffle tuition/state funds? Nope. It comes from the quasi private "foundation" aka the Donor/advancement funds. Donors normally don't like funding parking decks, but the foundation does have X money aside for ANY budget shortfall.

Thus many schools are looking at a situation whereby their enrollment/state support goes down, the service/loan costs are requiring general/foundation dollars to cover basic debt burdens, and then higher cost. Keep in mind, those foundation/general funds normally go into other funding needs, such as renovation, land acquisition, and fronting the school money etc. Thus these funds are running out and some schools. Those funds often also cover athletics if they are behind... and most schools are as most schools are not nationally branded D1 schools.

If a school had a high debt burden from a major building campaign, etc then they are doubly in trouble.

Athletics can't cover that. Athletic "profits" is chump change

flag link

military_tech

thumb_down

thumb_up

76er, I TUed you because i agree that the Dabo-makes-millions-as-a-modern-day-slaveowner crowd are idiots, but it's not as though that POTENTIAL income isn't out there for athletes.

If we are talking about NIL income, that will be coming from outside sources, not the schools, and that market doesn't exist until it gets created. But it will, because business owners are looking to use athletes to gain a competitive advantage.

But if you're talking about Contractor or Employee payments direct from schools that would essentially make these students professionals, I agree: only a tiny fraction of programs could pay that.

Once again, the talking heads are not interested in helping the majority of student-athletes. They keep looking to warp the entire system to benefit the top 1% in the most lucrative sports and programs.

Finding a way to write a check to every student-athlete? Wow. Can you imagine how much the fans and non-athletic students are going to have to pony up for that to happen?

Re: Universities everywhere are having to make tough financial

Re: Universities everywhere are having to make tough financial

Peanuts belong in cold Are See Colas.

Good. They’ve been gouging John Q public

Re: Universities everywhere are having to make tough financial

Re: Universities everywhere are having to make tough financial

TigerBoard POTD