A high estimate for expenses for an East Tennessee State University football team would be just under $4.9 million per year by 2018-19, according to a school administrator who helped prepare documents about the cost.
This estimate reflects a possible loss because revenue was projected at just under $4.5 million; however, that would be covered by a proposed student athletic fee that could begin being collected this fall. That loss would eventually be shored up as the program gets established, said David Collins, ETSU vice president for finance and administration, who added the figures were estimates projecting out six years.
ETSU administrators are estimating to earn just under $4.5 million each year from a football program that would cost just more than $3.5 million per year to operate in flat out “expenditures” by 2018-19 The $4.9 million figure comes about by adding in miscellaneous expenses and gender equity costs. This reflects a loss of around $426,500, but these are just estimates. Collins said revenues are estimated low while expenses are estimated high.
These numbers were provided to the Johnson City Press through an open records request Thursday. The numbers were prepared to send to the Tennessee Board of Regents, the governing body of ETSU, as the Regents consider a fee increase of $125 per student per semester to pay for a new ETSU football program. ETSU does not have football now.
Collins said the difference between revenue and expenses is covered by the more than $2 million the new athletic fee would generate annually beginning this coming school year if approved. Football expenses would be limited mainly to coaching salaries until a few years from now, allowing time for the football pot to accrue a reserve fund to cover that deficit and other expenses as the program gets established.
By 2018-19, the balance carried forward from revenues, largely from the new athletic fee, is estimated to be $2,193,352.
“So we know we’ll have money to cover that,” Collins said of the estimated deficit. “We also know that we can’t carry that negative and there’ll be adjustments. Again, all we’re saying there is we’re being conservative on our revenue and liberal on our expenses, and when we get out there and we have the actual revenues and actual expenditures we will be in balance. We have to be in balance. We are required to be in balance. We will have to make adjustments as necessary.”
This new athletic fee was proposed and approved in January by the ETSU Student Government Association.
ETSU Interim Athletic Director Richard Sander has said if the TBR approves the new athletic fee, ETSU could have a football team on the field by fall 2015.
ETSU is predicting to take in $4,471,000 in revenue from student athletic fees, NCAA scholarship fee distributions, game guarantees, marketing/promotions contracts, radio contracts, concessions, merchandise and fundraising by the 2018-19 school year.
By that same year, expenditures on coaching salaries, travel, recruiting, operations, scholarships, summer school aid for 10 athletes and fifth-year aid for 10 athletes was estimated to be $3,567,576.
Now, it is important to note there are other expenses related to a football program beyond what are considered “expenditures.”
Other administrative costs include various position salaries, insurance and miscellaneous expenses that the university has estimated at $729,960. This brings up the total football and other administrative costs to $4,297,536 by 2018-19.
The documentation prepared for the TBR includes gender equity expenses of $600,000 by 2018-19. This would bring the total expense for football up to $4,897,536.
The TBR should vote on the fee at the end of this month.