Washington State University faculty members are incensed over a proposal from the college administration to funnel $2 million to $3 million in university funds to the athletics department budget.
The WSU Faculty Senate recently released a statement to the WSU Board of Regents in response to the proposed funding. Vice President for Finance and Administration Stacy Pearson said it is unlikely the university could implement the subsidy for the upcoming 2021-22 fiscal year until budgets recover, so the funding is tentatively proposed for 2022-23.
The plan was offered in a year that college officials say has thus far yielded $20 million to $30 million in operating losses for the athletics department, due to COVID-19 pandemic impacts on Pac-12 Conference sporting events and resulting media revenue.
Pearson said the $77 million athletics department budget has sustained the deficit despite around $7.9 million in reductions through the elimination of travel expenses, salary cuts, hiring freezes and other means. The administration’s proposal calls for the department to make at least $1 million to $2 million of those cuts permanent.
The $2 million to $3 million proposed subsidy — which would come from auxiliary revenues, such as those from housing, dining and parking/transportation — would not be a freestanding deposit, but would cover an existing expense, Pearson said. One option under consideration is Pac-12 dues, which are estimated to be around $2.4 million for 2021-22.
“The WSU Athletics program is a powerful tool for increasing the awareness of Washington State University across the state and around the nation,” Phil Weiler, WSU’s vice president of marketing and communications, said in a statement. “Athletics helps develop an affinity for the university among members of the public who may have no other connection to WSU.”
The Board of Regents next meets in March. College officials said representatives from the college administration plan to at least update the Board on the proposal at that time.
In the long term, university officials hope the subsidy and budget reductions can help the athletics department turn around upward of $100 million in projected losses that have accumulated over the past decade from annual operating deficits and debts owed for remodeling Martin Stadium and building a new football operations building. WSU is on the hook for Martin Stadium and football operations building debt payments through 2039, Pearson said.
“The proposal to refinance/restructure the debt, permanently reduce the Athletics expenditure budget, increase revenues through fundraising, ticket sales and media rights and provide some additional subsidy if and when the University is able to is intended to be a multipronged approach for a long-term solution,” she said in a statement. “It will take years to right this ship, but we should be very intentional in agreeing to and implementing a plan to solve this.”
Athletics Director Pat Chun was unavailable for comment.
The athletics department’s historic losses are among the chief reasons WSU’s Faculty Senate is calling on the Board of Regents to reject the $2 million to $3 million subsidy.
“You can call it a debt or a deficit, but the bottom line is $120 million has gone into their pocket,” said Von Walden, chair of the Faculty Senate ad hoc committee that evaluated the proposal. “And because of that, we haven’t been able to invest in other areas.”
The COVID-19 pandemic prompted WSU to make 10% budget reductions across the board, Pearson said. As a result, Walden said university academic units have seen budget reductions of 10% or more, with cuts to course instructors and faculty positions among the most painful.
“We support a self-sustaining athletics department that doesn’t reduce resources from our land-grant mission,” said Walden, who teaches civil and environmental engineering. “Entertainment through athletics is not part of the land-grant mission.”
In the statement to the Board of Regents, the Faculty Senate said the proposal is unreasonable, since there is no tangible data supporting the administration’s argument that intercollegiate athletics “play a crucial role” in bolstering student enrollment and retention rates.
Faculty members are concerned the diversion of funds could harm morale, as Walden said they believe the funding could instead be used elsewhere.
“There is also a substantial risk of a ‘brain drain’ from WSU if faculty begin to search for jobs elsewhere,” the Faculty Senate statement reads. “We respectfully ask the Board of Regents to consider working with the administration and Faculty Senate to develop a plan to use the $2-3M to address other pressing issues, such as closing significant gender- and ethnicity-based pay gaps at WSU, investing in faculty recruitment and retention, and improving research facilities.”
Walden emphasized that faculty members are not opposed to intercollegiate athletics at WSU, saying faculty members “know the good things they bring to WSU.”
“What we are supporting is a self-sustaining athletics department because our athletics department has not been able to balance its budget, and they’re carrying a large internal debt right now,” he said. “This statement is really to present (the Board of Regents) with an alternative view on the proposal from the perspective of the faculty and how we feel it impacts the core mission of teaching, research and outreach.”
In 2011, WSU was providing as much as $8.4 million in subsidies to the athletics department budget, Pearson said. The subsidies covered costs including Pac-12 dues, gender equity (Title IX compliance) costs and custodial expenses.
When the entire university was in a deficit, however, WSU steadily reduced that support to the $4.1 million it’s been since around 2017, which is enough to cover gender equity costs ($3.7 million) and other compliance costs, Pearson said. Any subsidies cannot come from appropriated funds or tuition.
Pearson said discussions concerning the long-term financial recovery plan for the athletics department budget have included restoring these contributions once the university achieves fiscal health.
“It wasn’t a ‘Let’s move money to athletics for them to spend,’ ” she said. “It was more of a ‘Should the university take on some of these expenses as we are able to do that.’ ”
Weiler said few athletics budgets across the country are able to cover their own costs. The few that can break even or better, he said, do so thanks primarily to program donations.
Media revenue makes up make up approximately 29% of the department’s budget, while athletics additionally receives a conference distribution from the Pac-12 of approximately 17%, Pearson said.
“There’s the old saw that athletics is the front door of a university,” Weiler said. “I don’t like that personally, but I think that there’s a lot of truth to the fact that people are aware of an institution, in part, because of its athletics program, for good or bad.”
