Athletic spending projected to decrease

Despite saving Rutgers a hefty $11 million since 2014, the school's athletics department still relies on a subsidy with one of the highest price tags in United States college athletics.

A report filed by Rutgers to the National Collegiate Athletic Association (NCAA) reveals the athletics department made use of more than $36 million taken from a combination of student fees, Rutgers’ overall budget and government aid, according to documents obtained by the Courier News/Home News Tribune. The support was just part of the $76.6 million overall budget from July 2013 through the end of June 2014.

The year 2013 was an especially expensive one for Rutgers athletics, which used a record-setting $47 million subsidy to pay for a slew of one-time costs, including a $2.2 million severance related to the abuse scandal involving former basketball coach Mike Rice and former athletic director Tim Pernetti. 

Rutgers chief financial officer Janine Purcaro told Gannett New Jersey that an annual payment of $1.625 million be made in each of the next four Septembers.

Rutgers' entrance into the Big Ten Conference also cost the University, with Rutgers paying $5 million in 2013 to leave the Big East conference and $6.5 million in 2014.

In addition, the athletic department received $27.9 million from the University’s financial allocations in 2012, which contributed to Rutgers athletics’ second-highest subsidy in 2014. Most of the high-priced subsidy came from direct institutional support, but the cost still only used about 2 percent of Rutgers’ total operational budget.

A presentation given by athletic director Julie Hermann in September 2014 demonstrates that the department is working on and executing a plethora of revenue-generating plans to compensate for recent spending. Fundraising priorities include growing scholarship support and household donors to Rutgers Athletics increased $2 million in 2014 after a decrease in support in 2013, reaching a total of $8.1 million in donations.

Renewal rates for athletic donors stood at more than 76 percent in September 2014, according to the presentation.

These efforts are met with significant setbacks. Rutgers had the lowest annual funds in 2013 of all Big Ten public universities and ranked sixth-lowest in total donors.

Despite Rutgers athletics’ obstacles, officials predict the University will generate more than $200 million in additional revenue over the course of Rutgers’ first 12 years in the Big Ten.

The athletic department’s goal is to reduce the subsidy by $1 million every year until full integration into the Big Ten in 2021-2022, Tom Luicci, senior director of digital media, said.

“In conjunction with that, revenues have been raised dramatically,” Luicci said. “There has been record attendance at football, and there has been record attendance at wrestling. The income for football, men’s basketball, wrestling and women’s basketball is up.”

The number of donors has also increased by one-third since last year, he noted.

The University’s invitation to join the Committee on Institutional Cooperation in 2012, of which other Big Ten schools are also members, also acts as a helping hand to smooth Rutgers’ transition into the Big Ten. According to the CIC, membership in the committee allows the University to save money, share assets and increase teaching, learning and research opportunities.

University President Robert L. Barchi echoed CIC’s claims in a 2012 Rutgers Today article.

“The CIC is committed to advance its members’ academic missions, leverage campus resources, share expertise and expand academic and research opportunities for students and faculty,” Barchi said.

While revenue is increasing year to year, many students and faculty members outside the athletic department feel the University unfairly prioritizes funds for sports. In terms of athletic spending’s payoff for Rutgers students and faculty, Luicci thinks the benefits are already visible.

“The last number I saw said that enrollment is up 12 percent," he said. "Enrollment for out-of-state applications is up 15 percent. … and so as a result of that, from what I’ve seen, is that the average SAT scores for Rutgers are up 20 points. Academics and athletics go hand-in-hand."

The Athletic Department aims to make its expenditures as transparent as “humanly possible,” Luicci said.

“There’s a story every year on our budget," Luicci said. "The subsidy is made public every year — all the numbers are out there."