Courtesy of Washington State University
Washington State University's plan to balance its athletics budget in five years relies in part on hopes of increased student fees, ticket sales and a boost in money from WSU's contract with the Pac-12 Network.
None of those, however, are a sure thing. The increase in student fees, for example, has not yet been discussed with students, who would have to approve it.
The plan will be presented for approval to WSU's Board of Regents next week.
The athletics department is currently operating in a deficit each year that will continue through 2022, the university projects. The budget this year is estimated to end with a deficit of $9.1 million, contributing to a cumulative deficit of $68 million to date. Though WSU's projected deficit should decrease per year for the next four years, the school says, the cumulative deficit will still climb to $85 million by 2022, the university says.
But in 2023, the first year WSU anticipates the athletics budget will be balanced, that $85 million deficit will begin to be cut down (the university dips into reserve funds to make up for the deficit each year). In 2023, the university expects a $200,000 surplus. Joan King, chief university budget officer, wouldn't say, however, when the university expects the $85 million cumulative debt to be eliminated.
"The first thing we need to do is get the budget into balance," King says.
The effort to slow the debt accumulation relies on a projected 27 percent increase in revenue by 2023. That includes a nearly $2 million increase in revenue from student fees, more than double the money athletics get currently from student fees. Currently, the students are charged $25 per semester to pay for WSU's stadium renovation.
The added fee has not been discussed with students. King says she's anticipating "we will work with students to implement a new fee," but nothing has been determined. Students would have to vote to approve the fee in a ballot proposal brought forth by the student senate.
Pat Chun, WSU's new athletic director, says he's optimistic students will support the fee, citing the "passion" they have for the athletic program.
"The engagement with students on many levels has been overwhelmingly positive," Chun says.
Chun, who took over as athletic director for Bill Moos, added that he's optimistic that the university will see more revenue from its TV deal with Pac-12 Network. The university has projected an increase each year in revenue from media rights: By 2023, they anticipate it to be $5 million more than 2018.
"It really is an opportunity for growth," Chun says.
The university projections also include a $3 million rise in ticket sales, which Chun says would likely come from increased attendance to men's and women's basketball games. This year, across all sports, revenue from ticket sales is estimated to reach $8.5 million. He forecasts that additional revenue will come from contributions to the Cougar Athletic Fund.
The projected athletics budget, which will be presented for approval to the university's Board of Regents next week, doesn't cut expenses. Rather, total expenses should increase by around $8 million by 2023, according to the university.
WSU says it already has the lowest annual operating expenses of any athletic program in the Pac-12 and spends less than any other program in a Power 5 conference.
The athletics debt largely came from investments in new facilities, such as a $61 million football complex.
"There is not an overnight solution to our budget issue," Chun says, noting the strategy to reduce the debt is long term. "We are confident the strategy and the pathway forward will elevate our program to even greater heights."
Check out WSU's full plan here