Rutgers' Financials

Submitted by WCHBlog on January 31st, 2019 at 7:16 PM

So Rutgers commissioned a fancy third-party audit of their athletic department since joining the Big Ten.

The end conclusion was predictable:

Screenshot 2019-01-31 at 5.42.22 PM.png

But I found some of the financial numbers involved pretty interesting. Namely, at $97M, Rutgers ranks 10th of the Big Ten schools listed(Northwestern is private and Pennsylvania has bizarre FOIA laws). But, that $97M includes the university itself kicking in $21M and student fees kicking in another $12M. Next highest total of direct institutional support is two schools at $14M, followed by one at $3M.

Rutgers is also taking advance payouts from the Big Ten against future Big Ten payouts, which I guess makes sense at zero interest, but they won't be getting a full Big Ten share until 2027.

I know there is a lot of creative accounting that can move money between the university and the athletic department, but the whole thing doesn't paint a pretty picture for their future. I don't see gambling on a "long-term deficit spending plan" working out in their favor.

 

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Mr Miggle

January 31st, 2019 at 9:47 PM ^

Joining the conference should be good for Rutgers finances, just not for their AD's bottom line. The academic side may be less visible to fans, but it's more important.

It also shows some bad planning by their AD. They gave Ash a contract they can't afford to buy out of. It would have been wiser to be extra thrifty in the most expensive sport and try to be competitive in basketball. That was at least feasible. 

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Moonlight Graham

January 31st, 2019 at 7:44 PM ^

I would love to ask him the question at a press conference: 

"When contemplating expansion, did you deliberately pass on Syracuse and Pitt, holding out for the weaker, less-geographically relevant, financially unstable Rutgers and Maryland athletic programs solely for the cable subscribers ... or were you really just caught either sleeping or masturbating while the ACC landed them?"

Imagine Pitt and Syracuse in the B1G East. Syracuse could have at least gotten BTN onto the NYC cable systems, and who cares about the DC area? It's already ACC-A10-Big East territory. 

Joined: 09/12/2011

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twotrueblue

January 31st, 2019 at 7:57 PM ^

Good point. I do believe 'Cuse and Maryland would have been enough. The Rutgers idea was bad. But it didn't look too bad at the time. Rutgers was a 8/9 win team annually.

When the ACC added Syracuse, Syracuse had only one winning season in the past 10 seasons. But Syracuse always had a pretty good basketball team. Which in hindsight should have trumped a better than average Rutgers football team.

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chatster

February 1st, 2019 at 12:30 AM ^

As a private university, Syracuse ("Sportscaster U") doesn't fit the typical profile of a Big Ten school (Northwestern excepted), and they might've struggled in football in the Big Ten. They're 99-132 and have had only six winning seasons since 2000, but they;re 5-1 in Bowl games during that time.

Although Syracuse would've given the Big Ten a strong men's basketball program that occasionally draws over 30,000 people to its games, plus strong men's and women's lacrosse programs, they compete in only seven men's sports (no baseball, hockey, wrestling, swimming and diving, tennis or golf), compared to Rutgers' nine men's sports including baseball and wrestling (no hockey, tennis or swimming and diving.)

Joined: 09/14/2010

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NittanyFan

January 31st, 2019 at 8:07 PM ^

FWIW - Rutgers gets their full B1G share starting in 2021, not 2027.  Which actually isn't that far off any more.

I do think it's kind of weird they're taking loans against that $.  I get that part of it is "creative accounting" - but they are extending their pain.

Maybe I'm wrong, but I think Rutgers' football and basketball will be middle-of-the-pack by 2030.

 

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PopeLando

February 1st, 2019 at 3:43 PM ^

Likewise.

That'll be a hard trap to avoid. They're not establishing a trust or athletic department endowment, which would be a smart thing to do if you can get 0% loans. They're literally borrowing from their own future to pay current operating expenses, and they have 8 more years to survive before they can stop holding their breath. 

Without a solid revenue stream tied to payments, if I was a bank I wouldn't touch a Rutgers note/bond with a 10-foot pole. They're fucking themselves.

Joined: 08/01/2015

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NittanyFan

January 31st, 2019 at 8:33 PM ^

You are right.  My bad.  

I thought Rutgers was borrowing $ interest-free against themselves, in a bit of an internal accounting trick (RU athletics getting $ from elsewhere in Rutgers, and then "paying it back" later).  I didn't know they were getting those interest-free loans straight from the B1G.

Still though - even at their 2014-2020 non-full share levels, it's a hell of a lot more $ than the AAC deal.  Plus, the additional revenue from attendance with U-M and OSU coming to town for football games instead of UCF and Memphis.  

They're literally mortgaging their 2021-2027 future to play at these poor levels in 2014-2020.  Yeesh.

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rob f

January 31st, 2019 at 8:37 PM ^

More likely, middle of the pack might be the ceiling they may infrequently reach.  As long as the divisional lineup remains as is, I don't foresee Rutger ever rising above 4th place in football, perpetually behind Michigan, Penn State, and OSU and nearly always trailing MSU, too.  Even IU has realistic expectations of staying out of the B1G East basement most seasons, knowing that the Scarlett Knights exist as their cushion.

I can't imagine the hopelessness most Jersey football fans must feel, especially if their two favorite teams are Rutgers and the J-E-T-S Jets.

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Avon Barksdale

January 31st, 2019 at 8:19 PM ^

Rutgers joining the Big Ten will forever be an embarrassment for the conference. There were so many better (realistic) options, including: Virginia, Virginia Tech, Syracuse, Kansas, and Georgia Tech. 

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