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ACC withheld their cut of revenue as part of the exit fee, and now they are well below meeting their operating costs.
Fear the tab, Turtles.
The University of Maryland's athletic department is in massive debt according to a report from the university (via the Washington Post). How much debt? More than $21 million in operating costs over the previous academic year, and this comes in advance of Maryland's big move to the Big Ten, which will be official on July 1, 2014.
At the very least, Maryland's athletic department is anticipating to work in debt for the next four academic years. The Big Ten move will bring along inclusion to a lucrative television contract that the university hopes will help it crawl out of the red. But in the here and now, it's still a very significant problem. It's also a problem that many believe was the catalyst for Maryland to jettison the ACC, a league it helped found in 1953.
The source of the debt was attributed to “past financial decisions” and the ACC keeping $15 million worth of revenues from last year that would have otherwise gone to Maryland if not for exit fees it incurred because of its move to the Big Ten. The total amount Maryland is currently on the books for over its inter-conference interlope: $52 million. The school is currently battling and in litigation with the ACC over how much it should have to pay for exiting the league.
So where's the money coming from? How is Maryland making up for costs it can't afford? The school is temporarily fronting the bill for its athletic department. Via the Post:
According to the report, the university has loaned the athletic department — which has a goal of being self-sufficient — upwards of $21 million to overcome the deficit, with additional loans of $20 million potentially required if the ACC continues to withhold revenue. The loans are funded by the university's Non-State Auxiliary Funds, which are collected from school-run programs such as parking tickets and dining services, according to a university spokesman.
“That's borrowed money,” Maryland President Wallace D. Loh said Monday in a telephone interview. “That's not a gift to athletics. Unless we get [money] back from the ACC, athletics has to pay that back.”
In 2012 the university cut seven athletic teams/programs in order to siphon costs. Findings also revealed the athletic department has failed in recent times to sufficiently feed all of its student-athletes over the course of a week (page 7 of the report).
Much of the pressure for Maryland to get into the black again falls on the football and men's basketball programs. In the past five years, those teams have gone 25-36 and 106-65, respectively, with a collective three postseason bids and a .565 win percentage. In recent years ticket revenue for football hasn't blossomed as the university hoped, and while the men's hoops team is on the way back to relevance, it's still struggling to fill the seats like it did at the turn of the century and into the early parts of the last decade. A recent report by the NCAA put Maryland's attendance at 25th in the nation for men's basketball in per-game average.
According to the university's report, there is concern for the future ahead in the Big Ten. Maryland officials worry the Terrapins will be slow in the Big Ten race, as the school is noted as being in “in the lowest quartile for revenues per student-athlete when compared to its Big Ten peers."
Maryland AD Kevin Anderson is quoted in the Post's story as being positive over Maryland's ability to campaign for funds and overachieve in the coming years as it shifts to being a Big Ten affiliate.
The entire report is below.
The University of Maryland's athletic department is in massive debt according to a report from the university (via the Washington Post). How much debt? More than $21 million in operating costs over the previous academic year, and this comes in advance of Maryland's big move to the Big Ten, which will be official on July 1, 2014.
At the very least, Maryland's athletic department is anticipating to work in debt for the next four academic years. The Big Ten move will bring along inclusion to a lucrative television contract that the university hopes will help it crawl out of the red. But in the here and now, it's still a very significant problem. It's also a problem that many believe was the catalyst for Maryland to jettison the ACC, a league it helped found in 1953.
The source of the debt was attributed to “past financial decisions” and the ACC keeping $15 million worth of revenues from last year that would have otherwise gone to Maryland if not for exit fees it incurred because of its move to the Big Ten. The total amount Maryland is currently on the books for over its inter-conference interlope: $52 million. The school is currently battling and in litigation with the ACC over how much it should have to pay for exiting the league.
So where's the money coming from? How is Maryland making up for costs it can't afford? The school is temporarily fronting the bill for its athletic department. Via the Post:
According to the report, the university has loaned the athletic department — which has a goal of being self-sufficient — upwards of $21 million to overcome the deficit, with additional loans of $20 million potentially required if the ACC continues to withhold revenue. The loans are funded by the university's Non-State Auxiliary Funds, which are collected from school-run programs such as parking tickets and dining services, according to a university spokesman.
“That's borrowed money,” Maryland President Wallace D. Loh said Monday in a telephone interview. “That's not a gift to athletics. Unless we get [money] back from the ACC, athletics has to pay that back.”
In 2012 the university cut seven athletic teams/programs in order to siphon costs. Findings also revealed the athletic department has failed in recent times to sufficiently feed all of its student-athletes over the course of a week (page 7 of the report).
Much of the pressure for Maryland to get into the black again falls on the football and men's basketball programs. In the past five years, those teams have gone 25-36 and 106-65, respectively, with a collective three postseason bids and a .565 win percentage. In recent years ticket revenue for football hasn't blossomed as the university hoped, and while the men's hoops team is on the way back to relevance, it's still struggling to fill the seats like it did at the turn of the century and into the early parts of the last decade. A recent report by the NCAA put Maryland's attendance at 25th in the nation for men's basketball in per-game average.
According to the university's report, there is concern for the future ahead in the Big Ten. Maryland officials worry the Terrapins will be slow in the Big Ten race, as the school is noted as being in “in the lowest quartile for revenues per student-athlete when compared to its Big Ten peers."
Maryland AD Kevin Anderson is quoted in the Post's story as being positive over Maryland's ability to campaign for funds and overachieve in the coming years as it shifts to being a Big Ten affiliate.
The entire report is below.
as the football team is getting well-fed by Chick-fil-A after every game.
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