2-14-13 WVU athletic department in red for 2 fiscal yearsSports Headlines Thursday, February 14th, 2013 Would you like to receive e-mail alerts when we have breaking news? Click here!
MORGANTOWN, W.Va. (AP) — West Virginia University’s athletic department reported a record deficit, revenues and expenses in its final season in the Big East Conference.
The university ended the last two fiscal years in the red and officials expect the deficits to continue for several years while WVU receives less than full revenue-sharing benefits from the Big 12.
The latest deficit _ nearly $13 million for the 2011-12 fiscal year _ was attributed largely to the $20 million that the university paid to leave the Big East. Without that exit fee, associate athletic director Mike Parsons said the department would have had a sizeable profit.
“We knew that when we made a $20 million commitment that was payable in so many days that it wasn’t going to be pretty,” he said. “But ultimately it ended up being a lot better than we thought it was going to be.”
The Mountaineers left the Big East for the Big 12 Conference after the 2011-12 fiscal year. Records obtained by The Dominion Post (http://bit.ly/o6b1OH ) show the athletic department’s deficit that year came despite record revenue totaling more than $80 million.
The 2010-11 deficit was more than $1 million. The losses in back-to-back years come after nine consecutive years of profits.
The Big 12′s revenue-sharing plan doles out about $20 million annually to member schools. In 2011-12, WVU’s share from the Big East was nearly $10 million, but the Big East kept $9 million of that as part of the university’s exit fee.
WVU will receive a 50 percent revenue share from the Big 12 in 2012-13, 67 percent in 2013-14, and 84 percent in 2014-15 before becoming a full-fledged member in 2015-16.
For the next several years, WVU’s athletic department is expected to take out loans through the university to help pay for operating expenses.
“A lot of it just depends on what happens,” Parsons said. “If ticket sales go up, maybe we don’t need as much. If they go down, maybe we’ll need more.
“You know moving forward, because of that conference revenue piece and some increased costs, we’re going to end up being in the red for a couple of years until we get full funding from the conference.”
It would mark the first time that the self-sustaining athletic department has had to use an internal loan to cover operating expenses.
“As we project out, this year and next year are going to be the bad years, but then after that you start getting into the slight profit, if expenses and revenues hold,” said Michael Szul, WVU’s associate athletic director for business operations.
No loan was needed to cover the 2011-12 loss.