The shutdown of college athletics caused by the coronavirus pandemic will push Georgia Tech’s athletic department further into the red (that most abhorred color), but it won’t prevent it from providing scholarship help for spring sports seniors that want to come back next academic year with the extra eligibility granted by the NCAA.
At the quarterly board meeting of the Georgia Tech Athletic Association on Thursday, conducted as a video conference, athletic director Todd Stansbury informed board members that the department is projecting to end the fiscal year with expenses exceeding revenues by $4.3 million, with revenues pegged at $78.75 million and expenses at $83.07 million. It will further increase the deficit in the reserve fund – the rainy-day account to cover unexpected expenditures – to $8.2 million.
COVID-19 – which caused a shortfall in expected distributions from the NCAA ($3 million) and from refunds for ticket sales to the ACC men’s basketball tournament ($474,000) as well as a prorated refund of student athletic fees ($964,000) – had a net impact of a shortage of $3.9 million.
“Right now, we’re in the process of identifying, O.K, what are our strategies and how are we going to close that gap?” Stansbury said. “I met with our head coaches (Wednesday) because this is obviously an all-hands-on-deck operation.”
Stansbury added that one possible source is a COVID-19 fundraising initiative to call on donors to help make ends meet.
“Obviously, going forward, a lot of unknowns – more unknowns than what’s known – so that’s going to be an evolving process,” Stansbury said. “But it’s something that, not only us, but every school in the ACC and across the country are grappling with.”
Stansbury also shared plans for how the scholarship costs for the approximately 13 spring sports athletes identified as probable to return (out of 42 seniors on spring sports rosters on the Tech website as of Friday). Stansbury estimated the cost at roughly $500,000, which is about 4% of this year’s total scholarship cost of $11.5 million.
The costs could be absorbed in multiple ways. First, he said, some coaches had not yet used all of their scholarships, so returning seniors could be folded into that existing allotment. Other coaches may have to use money from their accounts with the school foundation to cover the extra grants.
“So we’re going to be able to get pretty close to even as far as financial impact of bringing those seniors back that want to come back,” Stansbury said.
The decision to provide scholarship support to would-be returning seniors, even at a time of financial difficulty, reflects Stansbury’s commitment to supporting Tech athletes. Even among members of power-conference schools, it is not a given.
Wisconsin announced Thursday that it will not allow spring sports seniors the opportunity to return, let alone provide scholarship support. On his monthly radio show, Wisconsin AD Barry Alvarez cited increased roster size and financial burden as factors in the decision, according to an ESPN report.
But the maneuvering necessary to come up with an extra $500,000 – that’s less than 1% of the projected expenses for this fiscal year – speaks to the uncertain financial position that the Tech athletic department stands upon as it waits for ACC Network dollars to help it regain its footing in years to come. That standing could be challenged even further if the football season, which generates the bulk of the athletic department’s revenues from ticket, suite and club-seat sales, is abbreviated due to concerns about the spread of the pandemic.
The department still aims to restore the reserve fund to a surplus of more than $10 million by fiscal year 2025 with help from anticipated revenues from the ACC Network and the five-game football series at Mercedes-Benz Stadium, which is to start this fall with a game against Notre Dame.
Stansbury did have a update that was more encouraging for the financial health of the department, saying that $2.7 million raised in March as part of the $125 million capital campaign that is scheduled to conclude at the end of the year. That included $1 million towards a $1.6 million project for a locker room for the track and field teams and another $1 million for the $70 million renovation of the Edge Center. Stansbury said he needs only another $5 million to reach the total for the Edge project, the centerpiece of the campaign.
“So our donors continue to be incredibly generous, and it was great to see that while things just seemed to be turning upside down, that the support of our donors continues to be there,” Stansbury said.
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