East Carolina University athletics is far from out of the woods financially. A tough situation and operating deficit of roughly $7.5 million before the COVID-19 pandemic struck was already going to force Athletic Director Jon Gilbert to make some difficult decisions.
The virus, which shut down the spring sports schedule for schools all across the country and forced the cancellation of the American Athletic Conference and NCAA basketball tournaments, has pushed ECU’s deficit to somewhere around $10-11 million.
That number, according to Gilbert in his presentation to the Athletics & Advancement Committee on Thursday, is down from the nearly $12 million deficit that was projected earlier in the year. Many factors have gone into that number decreasing, including an increased pay-out from the AAC and a strong showing from the Pirate Club’s fundraising efforts.
After making a slew of cuts, both to athletic department budgets and the reduction of sponsored sports from 20 to 16, Gilbert said the operating deficit should get “close” to getting back to the original $7.5 million deficit.
Those cuts, which included the elimination of the entire swimming and diving and tennis programs, are slated to save the department $4.6 million. Around $2.6 million of that is coming from the cutting of those programs, but reducing every team’s budget and athletic units will also save $1.1 million, according to Gilbert.
ECU is also cutting down on the among of student-athletes enrolled in summer school to those who need it for eligibility purposes, eliminating vacant positions and furloughing staff for five days spread across a number of months. Those moves should save the department around another $1 million, while Gilbert will also reduce his salary by $100,000.
While a major swing at cutting the budget, Gilbert and his department is projecting an $11 million operating deficit for next year, signaling move cuts are needed.
“These reductions are simply not enough,” Gilbert told the committee. “We are going to have to find ways to increase revenue and continue to cut costs and be more efficient. The swimming and diving of $1.6 million and the men’s and women’s tennis reduction of a little north of $1 million, we will not that total reduction in year one. It will a couple of years to fully realize that reduction because of the scholarship costs that we are honoring for those sports.”
Gilbert said they are projecting a $4.7 million loss in revenue for this coming fiscal year that started on July 1. He also said “a lot of assumptions” go into that figure, but he is anticipating reductions in multiple areas including student fees, Pirate Club donations, football revenue, NCAA and AAC pay-outs and concessions.
Without the revenue that would come from playing football and basketball with fans this fall and baseball in the spring, Gilbert said that $11 million operating deficit could increase. Already, his department has been digging into plans for capacity restrictions in Dowdy-Ficklen Stadium should those be put into place.
“We are putting in contingencies for capacity limitations at Dowdy-Ficklen,” Gilbert said. “I do not anticipate being allowed to have a full capacity. That will be dictated by health officials, our system office and then I’ll be working through the chancellor on how we implement that.”
Under a 50% reduction in fans, Gilbert said approximately 24,577 fans would be allowed into Dowdy-Ficklen Stadium, with around 12,289 allowed under a 25% capacity limit. As of yet, there is no word from state and local officials about what the capacity situation could look like beginning in August, or if football will even be played in 2020.
Nevertheless, Gilbert said season ticket holders and students would receive priority should there be a limited number of seats available.
Without fans in the stands this fall, ECU could be staring down additional cuts to a department that has seen many already. Those could take the form of additional furloughs of staff, but just how drastic those might be will not be known until later.
Toward the end of his presentation, Gilbert did outline a handful of additional expenses associated with various projects around the department. Under the NCAA’s plan to extend an additional year of eligibility to spring sport student-athletes, ECU has seen a number of athletes elect to return. Gilbert said it will cost $290,000 to fund those additional scholarships in 2020, while the department’s move to fully fund the lacrosse program comes with a price tag of $120,000.
Around $100,000 has been budgeted for supplies to combat COVID-19, but Gilbert said that number is just a “placeholder” and could increase as the fall wears on. Currently, 16 positive COVID-19 tests have been identified among 270 total tests of athletes, coaches and staff.
“I do think that in the coming weeks we’ll have a better idea of what the fall will look like, what ramifications will come from that,” Gilbert said. “I would tell you, based on our revenue, based on the reductions that we’ve made thus far, it is still not enough.
“We are still going to need institutional support, we’re still going to have to tighten our belt. Depending on what the fall looks like, we could have additional furloughs for our entire athletic department staff. I’m encouraged about where we are, I feel good about our plan, but I also know the coming weeks will give us a snapshot of what we really have to plan for.”