ITEM 127-1001-S0505 Attachment 1
13 April 2005
TO: S. M. Stearns, Commissioner
FROM: G. M. Dennison, President
SUBJECT: Adjustment to the Athletics Deficit Elimination and Deficit Prevention Plan
For your information and that of the Board of Regents, I have attached a report detailing progress on the Athletics Deficit Elimination/Prevention Plan. The report demonstrates that the University met and exceeded the financial targets outlined in the approved plan, and dedicated a major portion of the additional revenue to reduce the deficit and thereby shorten the time required to eliminate it. I have highlighted below several positive developments during the current year that made this outcome possible.
· In addition to the $125,000 deficit reduction contribution required of Athletics, greater than expected revenues from football and basketball provided an additional $200,000 to reduce the deficit. The net effect shortens the deficit elimination schedule by one full year.
· Because of the enhanced revenue estimates, and in response to student concerns, the University proposes to reduce the student game day ticket charges from $7.00 to $4.00, saving students more than $78,000 per year.
· The University proposes as well to direct approximately $300,000 from one-time-only tournament net revenues and other net revenuestoward the Athletics Maintenance and Repair account to address problems before they become serious.
· Increased revenues, better internal cost containment, and lower than anticipated scholarship expense enable the University to reconsider the phasing of increased reliance on the Grizzly Scholarship Association for contributions to the Deficit Elimination Plan, thus allowing the GSA to focus on other fund raising projects with more promising long-term prospects.
· Additionally, the University will implement “One Stop Shopping” for all athletic event tickets to streamline business operations and extricate the GSA from the ticketing process, thereby reducing confusion among the clients.
In summary, I believe that progress to date in managing the Athletics deficit and enhancing internal operations within Athletics augurs well for the future. Director Don Read has worked closely with Vice President Bob Duringer and Director Bill Muse to establish processes and controls that will prevent any recurrence of the earlier problems. I have great confidence that the University will eliminate the existing deficit well before the assigned date.
Thank you for your attention to this matter.