UCLA Athletics Posts $62.5M Loss for 2021 Fiscal Year
The Athletic Department has now lost more than $100 million over three years.
After incurring a budget deficit totaling $40.6 million in 2019 and 2020, UCLA’s budget deficit blew up in the 2021 fiscal year to $62.5 million, according to a report this morning by respected Pac-12 columnist Jon Wilner. That brings the three year shortfall to more than $100 million.
When fans were not able to attend games during the 2020-2021 school year, a bigger deficit was certainly expected, but I’m not sure anyone could have fathomed that it would be quite this big.
Wilner’s article cites four reasons which “pummeled Pac-12 athletic departments” in 2021:
— Negligible ticket revenue because fans were not allowed to attend football and basketball games.
— Greatly reduced media revenue because the conference only played half the football season.
— Depressed philanthropic support and reduced sponsorship revenue.
— Reductions in travel and recruiting expenses were offset by the cost of COVID testing. (UCLA spent $2 million directly on COVID testing and another $1 million on shared conference costs.)
By comparison, UC Berkeley actually finished the year with a small surplus of $3.5 million. That’s a remarkable feat when considering all of the factors listed above.
Elsewhere in the Pac-12, Colorado finished the year with a $17.5 million loss while Utah’s budget deficit was $31 million.
Wilner also points out that Utah and other schools used furloughs as a way to help control expenses. UCLA did not require furloughs.
He also discusses the differences in the way the Berkeley and Los Angeles campuses treat athletics. He quotes Berkeley chancellor Carol Christ’s commitment which was made a few years ago to the athletic department. Christ wrote at the time, “I believe that our Intercollegiate Athletics program has great value for the Berkeley campus.”
Meanwhile, it appears that Gene Block continues to fail to understand the value that the athletic department brings as the de facto marketing arm of the university.
UC Berkeley covered $20.1 million in athletic department expenses while UCLA’s campus support topped out at just $2.5 million.
To be sure, $18 million or so in additional campus support would not have resulted in the department going from the red to the black, but it certainly would have helped in each of the past three years. In fact, it would have almost eliminated the deficit in 2019 and 2020 while cutting the 2021 deficit by about a third.
Instead, Block gave the department an interest-bearing loan in 2019 and 2020. Wilner’s article does not indicate if one was also provided in 2021, but it’s probably safe to assume that was the case, given that the money needed to come from somewhere.
I’ve noted before how the athletic department actually has to pay the university to use Pauley Pavilion because the building belongs to UCLA Recreation. Wilner is quick to point out how bizarre that situation is considering the fact that it was the athletic department, not UCLA Recreation which paid for the Pauley renovation.
With this information now available, it becomes much clearer as to why the department was not in a hurry to pay out a $9 million buyout to Chip Kelly, or the $4.6 million the department would have had to shell out for Kelly’s 2022 salary after his buyout expired earlier this month.