Following the BCS money trail

By and

Editor’s note: This is the first installment in a two-part series.

When the U football team qualified for this year’s Fiesta Bowl, the campus was abuzz with what the university might do with the extra money it would be receiving. Many students assumed that the school was about to get around $14 million, but it turns out this wasn’t the case.

The U did make a significant amount of money from the BCS for its participation in the Fiesta Bowl, but the actual payout that trickled down to the U was somewhere between $2 million to $2.4 million-nowhere near the $14 million figure that had been thrown around.

The misunderstanding stems in part from the information made available to the public by the BCS. According to the official Web site of the Bowl Championship Series, any team from a non-BCS conference participating in a BCS bowl game will receive a base share of $14.438 million.

The problem is that as a member of the Mountain West Conference, the U was obligated to share a portion of the proceeds with each school in the conference. Each school ultimately received in excess of $1 million, including BYU. Additionally, the U had to spend more than $2 million to buy out its commitment to the Liberty Bowl. When all of its obligations were met, the U ended up with around $2 million more than it would have had normally in a year it didn’t attend the Fiesta Bowl.

Where the money goes

Although the U didn’t end up with the $14 million some had hoped for, the incoming money will still serve several needs. According to U Athletics Director Chris Hill, the money will be spent in three ways: increased operating expense budgets for the athletic teams, some one-time projects around campus and the creation of a rainy-day fund.

Hill said the most important thing the money can do is to get the athletics department back on track with the creation of a rainy-day fund. The U Athletics Department had been struggling for some time before last season, and the reserve budget was drying up. The football team lost more than $1 million in the 2003 season after paying for two coaching staffs (McBride was still on the payroll) along with the steep cost of attending the Liberty Bowl. The athletics department spent the last of its reserve money recouping those losses.

“Over the last several years, we’ve been hit pretty hard with expenses and we’ve lost some money,” Hill said. “We’re down to where we don’t have any reserves.”

Hill said the creation of a rainy-day fund could make it easier to deal with events that are tough to anticipate. For example, when it snows during a football game, the athletics department loses around $300,000.

Considering the bad position the athletics department was in, the money couldn’t have come at a better time.

“I don’t know what we would have done without this money,” Hill said. “It was getting pretty scary.”

The second priority for the new money is to increase the operating expenses of the teams affiliated with the athletics department. Hill said an additional $300,000 to $400,000 would be committed to each year’s budget for the next three to five years.

Hill acknowledged the risk of committing one-time money to operating expenses, but hopes it will create the conditions necessary to allow the growth that will ultimately bring more money into the department.

“You have to be careful with one-time money,” Hill said. “You put an extra $300,000 into your budget for the next five years and pretty soon that’s $1.5 million you’re already in the hole again. We’re taking a risk by putting extra money into the operating expenses, so we have to hope that we can keep growing.”

The new money in the operating expense budget will be used, among other things, to boost travel budgets, to cover a higher salary for this year’s football staff and to give one-time raises to assistant coaches from some of the non-revenue sports.

Hill said he wants to reward a few specific individuals, but making everyone happy has been a challenge.

“It’s been a hard one,” Hill said. “People hear $14 million, and they think ‘Why can’t I get an $8,000 raise?’ They don’t understand that it doesn’t work like that.”

The final way the funds will be used is for some one-time projects around campus that have needed attention for some time. Hill said priorities in this area included a $25,000 commitment for championship banners in the Huntsman Center and $50,000 for new locker rooms in the HPER building that will benefit the volleyball team and the women’s swimming team.

The U might not have ended up with $14 million, but the money it did get will give the U Athletics Department the money to thrive for at least a few more years.

Tomorrow: How will the rest of the school benefit?

[email protected]