Penn State Vice President for Intercollegiate Athletics Sandy Barbour indicated during a Monday video call with reporters that the department is not looking to cut any programs but that all options are on the table.
Barbour spoke for roughly an hour during her first public appearance since last week’s Big Ten decision to cancel the fall sports calendar amid concerns related to the ongoing COVID-19 pandemic.
‘We have a long history and tradition of comprehensive excellence, across a fairly large number of sports, and certainly one of my goals, would be to continue that tradition and continue that as as one of our long, long held values,’ Barbour said.
Not including club sports, Penn State boasts 31 athletic teams, most of which are funded by the football program, one of just three programs on campus to make a profit. Men’s basketball and men’s hockey are the other two, although the latter more on a technicality as Penn State accounting logs some of the operational costs of Pegula Ice Arena in a different area within the department’s budget.
All three programs make their money from a combination of ticketing and media rights, football leading the way with just over $100 million in revenue while reporting roughly $46.2 million in expenses during the 2019 fiscal year. The 2020 fiscal report would traditionally be due out in the first few months of 2021.
The rest are cash negative. Even the likes of the wildly popular wrestling program effectively lose money, bringing in just over $2 million in operation revenues during the 2019 fiscal year while posting $2.7 million in expenses.
While Cael Sanderson and his national title contenders are unlikely to be in any danger of becoming scrubbed from Penn State’s athletic roster, it certainly goes to show that popularity does not inherently equate to profit in an expense-driven collegiate landscape. In turn, the cancelation and uncertainty of football revenue during the COVID-19 pandemic means a struggle for an otherwise highly functional athletic department to make ends meet. Barbour previously noted that without football the department is eye eight or nine figure losses.
Program cutting may not be preferred nor Penn State’s first act, but it’s not out of the question. At least one department source suggested a second round of pay related cuts could come as early as this week.
‘Having said that,’ Barbour continued, ‘Obviously this is going to be a very difficult financial situation. I have tasked our team — and certainly a part of looking at every available measure to close the gap of whatever the revenue is that we’re going to lose. As you know, we’ve undergone salary reductions…we’ll just need to make sure to be fiscally responsible from a leadership standpoint. I’ve got to put everything on the table and, and then analyze and understand the impacts on our on our department, on our organization, and then the impacts to the bottom line, and we’ll have to decide which of those measures we take.’
When those decisions might come is uncertain, especially as administrators sit months removed from a tentatively proposed spring football season. Stanford, something of the gold standard for quality in both traditional and non-traditional sports, showed how dire the financial situation can become, cutting 11 teams from its docket in June — a reminder that the best laid plans of administrators and coaches may not pan out quite as intended.
But for now, Penn State eyes cutting programs as an option much farther down its list.
‘We have north of $25 million in reserves,’ Barbour added. ‘Now, we had eyes on using some of that capital for some of our facilities projects that are are crucial to us. But those those reserves go towards closing that gap, our expense reductions that we’ve undertaken either organically or through cuts go to closing that gap and and the point is that we need to reduce everything we possibly can, without impacting our competitiveness.’
