Students urged the University of New Mexico Board of Regents to not forgive the athletics department’s accumulated $7.5 million deficit at the Budget Summit Thursday.
And the regents delivered.
Board of Regents president Robert Doughty made the move to table the issue of UNM athletics’ deficit until the department can provide a balanced budget for 2019.
“I need to be convinced now more than anything that we will not have a deficit next year,” Doughty said. “We table any discussion on dealing with the past deficit until we get a financially sound transparent budget for 2019.”
The measure passed unanimously.
Athletics must finish drafting and then present a balanced 2019 budget before the regents at the April 10 Finance and Facilities Committee meeting.
The UNM Board of Regents is comprised of seven governor-appointed members who are responsible for determining how UNM spends its money, as well as making official University policies and goals.
The management of the University falls to the president. In the capacity of managing University assets, the board acts as a gatekeeper for departments seeking financial resources.
The Budget Summit is an annual meeting where the major University players — such as the Health Science Center, Main Campus and Department of Athletics — propose budgets to the regents for approval for coming fiscal year.
On Tuesday, the athletics department submitted a proposal petitioning the University forgive all but $1.1 million of the deficit, which ballooned by $3.3 million in the past year. The athletics department’s debt to the University began accumulating in 2006. The department has been operating in a deficit for the past nine out of 11 fiscal years but turned a profit in 2009-2010 and 2014-2015 fiscal years.
In UNM’s new Athletic Director Eddie Nuñez’ memo titled “Rationale for Reducing Cumulative Deficit,” he writes that the deficit occurs due to multiple factors.
“This includes expenses outpacing revenues, expenses being understated, revenues being overstated, a lack of consistent fiscal oversight within the department and University and a lower level of institutional support compared to our peer institutions,” the memo said.
The meeting opened with passionate student comments regarding tuition increases and concerns about prioritizing the forgiveness of the athletics department’s deficits.
Benjamín Lopez, a sophomore studying economics, spoke before the board during public comment and said that allowing athletics to operate year after year in deficit was “rewarding financial mismanagement with a blank check.”
In an interview with the Daily Lobo, he emphasized that the Department of Athletics’ debt to the University is personal to students.
“I just felt like as a student who is paying for these kinds of bailouts, paying for these deficits, it’s my responsibility to come up and say I don’t support this,” Lopez said. “And since you’re using my money, and you’re being paid with my money as regents, you have to know how I feel about this.”
Two student athletes, junior Josh Kerr, a communications major who runs track and field for the University, and women’s basketball senior, Cherise Beynon, talked about their experiences as student-athletes.
Both Kerr and Beynon talked about how the program offers student-athletes an education and a means of support.
Beynon said the athletic scholarships matter to her personally, because she otherwise would not be able to attend college.
“I wouldn’t be able to be here today without it,” Beynon said. “My family wouldn’t’ve been able to afford it. I’m going to be the first to graduate college in my family.”
After listening to the UNM HSC budget proposal — accompanied by a 20-slide PowerPoint brimming with colorful pie charts — Nuñez and new Chief Financial Officer Rob Robinson began reading, line by line, the updated expectations for the current fiscal year. Their analysis showed that the 2018 budget deteriorated, operating in a deficit of $3.3 million, more than double the projections.
And athletics’ 2019 budget?
Under the header for “Fiscal Year 2019 Budget” was a short paragraph stating the budget was incomplete and would be presented at a later date.
“Although a majority of the reconciliation work has been accomplished, the projected budget for fiscal year 2019 needs additional refinement. The athletics department will continue to work toward that end with a plan to present the FY19 budget at the Finance and Facilities Committee meeting,” the proposal said.
At one point Doughty told Nuñez and Robinson to “sit down,” and called up Brad Hutchins from the audience.
Hutchins currently serves as deputy athletic director for External Operations, formerly communications for the athletics department. He was part of the team that presented the previous budgets to the board with former Athletic Director Paul Krebs.
Doughty then lambasted the three men. He expressed frustration with athletics’ previous budget proposals and that the department “mislead” the Board of Regents and himself personally in previous years.
“In my time at this University — the last four years — I’m as mad as I’ve ever been,” Doughty said, punctuating his next remarks with an open-hand slap to the table. “And I want to know right now, in front of everybody, why are we $3.3 million in the hole when I was promised last year that we had a balanced budget?”
When Hutchins attempted to answer, citing overshot projections from the UNM vs. New Mexico State games, Doughty interrupted, telling Hutchins that the department projections were not grounded in reality.
“I’m going to cut you off here,” Doughty said. “I think the projection was made just to balance the budget.”
Answers to questions were insufficient for Doughty, who then moved to table the issue of the deficit until a balanced budget for 2019 was finished.
“I still don’t have a good explanation — I don’t think this board does or the community or the campus understands how we can be that far off,” Doughty said.
The next step for athletics
The next step may include cutting sports.
Last April, controversy erupted over the surprise cutting of the successful ski team at UNM. After several protests and community backlash, the athletics department reinstated it in December.
Nuñez told regents that while cutting sports is unpleasant, it is an option — and that may be something to watch for in 2019 and 2020.
“I’m the first to say that I do not want to cut a sport, but we have to look at this,” Nuñez said.
In an interview with the Daily Lobo, Nuñez said, “There may be more opportunities that we just have to be pointed to (and) haven’t looked at yet — before we just look at eliminating a debt.”
Regent Thomas Clifford, the secretary treasurer, said that the athletics budget has a long road ahead, and balancing the budget will not be easy. He said while he understands that some aspects of the budget are not under the athletics department’s control, the department needs to act in good faith.
“I think what I heard from the students today is the same among the Board of Regents,” Clifford said. “Just show us that you are good stewards of the money.”
Danielle Prokop is a freelance reporter at the Daily Lobo. She can be contacted by email at firstname.lastname@example.org or on Twitter @ProkopDani.