Special report: Athletics spending soared during Rutgers' financial crisis

At the onset of the coronavirus disease (COVID-19) pandemic, Rutgers declared a fiscal emergency and aimed to reduce the budgetary shortfall. The Athletics Department, though, continued spending money largely uninterrupted — purchasing everything from a $12,400 power nap machine, to $470 laser pointers for the football coaches, to a car service for a single track athlete totaling $4,400. 

Even as University officials laid off hundreds of workers last year, banned all non-essential expenditures, ordered all departments to cut their budgets and suspended all scheduled pay raises, the expense budget for Athletics in fiscal year 2021 jumped by 13 percent over the previous year ­– including a 24 percent rise in salary and fringe benefits for the department’s staff, according to an analysis by The Daily Targum of individual unit budgets the University publishes annually. 

The increased Athletics spending took place despite plummeting sports revenues from lack of attendance at games and curtailed team schedules.

In recent weeks, media reports have focused on the mushrooming Athletics deficit of approximately $265 million since Rutgers joined the Big Ten Conference, and the mounting loans to the department from the University to cover recurring annual shortfalls, a situation that University President Jonathan Holloway recently conceded is “unsustainable.” Holloway nonetheless insisted, during his annual address to the University Senate on Sept. 24, that the Athletics budget had been spent appropriately and has received consistently clean audits.

But scores of Rutgers internal purchasing orders reviewed by the Targum show numerous expenditures that hardly qualify as “essential.” Those purchase orders, obtained during our six-month investigation into the University’s spending during the COVID-19 pandemic, offer a rare look inside the Athletics budget — part of which is financed by Rutgers students’ fees. Among the noteworthy examples are:

• $4,692 paid on June 5, 2020, for 10 laser pointer remotes for football coaches. That is approximately $470 per pointer, when comparable models can be found on Amazon for $30 to $50 apiece.

• $2,500 paid to K Sound LLC on Oct. 13, 2020 for generating fake crowd noise for a football team practice.

• More than $24,000 spent in November and December 2020 for upgrades to the football coaches' offices in the Hale Center on Busch campus, including $3,100 for a new Samsung TV.

• $385,914 paid in May to SHI International Corp., the corporate sponsor of Rutgers football, to install wifi service in the student section of SHI stadium.

• Nearly $4,400 on June 14 for car service for a lone track athlete.

• $12,400 on June 29 for a Napzzz sport pod, which allows members of the men’s basketball team to enjoy a private power nap with surround-sound music.

The Targum found no evidence that any of these expenses were paid for with pandemic relief funding, something which federal and state emergency funding prohibits.

During the COVID-19 pandemic, Rutgers took a number of cost-cutting measures at the expense of approximately 1,500 employees. The Board of Governors first froze hiring of part-time lecturers (PTL) in April 2020, then declared a fiscal emergency on June 8, 2020, halted all new hiring and capital projects and suspended promised raises for all unionized employees, initially projecting a $200 million deficit.

Throughout the waves of layoffs, which extended beyond PTLs and budget cuts for academic programs, the Targum found that spending by Athletics only grew.

The 2021 budget approved by the Board of Governors projected a 30 percent decrease in revenues for Athletics, but an increase in spending of more than 13 percent, from $102.8 million to $117 million, according to unit-by-unit financial records the Targum reviewed.

By comparison, the School of Arts and Sciences in New Brunswick, which saw significant PTL layoffs, had a projected decrease in revenue of more than 5 percent but also saw its expense budget decrease by more than 6 percent, from $376.46 million to $352.7 million.

Hasim Phillips, a spokesperson for Athletics, said the University expected higher revenues for football and basketball but the COVID-19 restrictions that prevented fans from attending games caused a significant impact on revenue. 

“Cancelled games during the football season reduced the income coming from the conference’s TV contracts, as well,” he said. “Meanwhile, Rutgers met its contractual obligations related to salaries and benefits for Athletics staff, including negotiated raises and an increase in health and pension benefits.”

While Athletics managed to pay raises for its personnel, faculty saw a number of layoffs and many professors were not afforded the same benefits during the pandemic. 

The figures included in the fiscal year 2021 budget are relative to the previous, pre-pandemic budget.

“It's not clear to me that just because they maintained salaries and benefits they had to increase expenditure by 13 percent — that's pretty unusual,” said Mark Killingsworth, professor in the Department of Economics and member of the Rutgers American Association of University Professors — American Federation of Teachers. "And it's also not something that they did with (academic) faculty. They wanted to, and did, space out payments."

In addition to the budget increases, Athletics kept spending for items that do not appear to be essential. 

Beginning in November 2020, for example, the University paid a combined $15,622 to Maul Electric Inc. and SupplyWorks to install lighting upgrades and new ceiling tiles in head football coach Greg Schiano’s office in the Hale Center on Busch campus.

The same month, the University paid $14,045 to M&S Communications Group for a sound system upgrade in Schiano’s office that included ceiling speakers and subwoofers, plus another $3,105 for a 75-inch Samsung TV — itself an upgrade from the original plan for a 65-inch TV, according to the invoices. In December 2020, another $1,370 was paid to Bennett Brothers Mechanical Inc. to insulate Schiano’s door to “protect from noise pollution.”

In June 2021, the department paid $12,400 to Napzzz for the self-contained sleeping pod that can accommodate one basketball player at a time. The company’s website boasts that the pod’s “breathable sliding shade provides for complete privacy to allow for total relaxation.”

Records show that Athletics filed a waiver of bid request for this purchase, meaning officials did not solicit competing bids for the lowest cost pod. The rationale given for the waiver was that Napzzz is the only brand that could accommodate a 7-foot tall, 250-pound player and offered “more privacy and seclusion when compared to other companies,” according to the records.

A few of the other expenses uncovered by the Targum include the $4,692 spent on 10 green laser pointer remotes from XOS Digital Inc. in June 2020, $2,550 in October 2020 for “fake crowd noise” at SHI Stadium for football practice and $2,603.49 in January for glass shelves in the office of head women’s basketball coach C. Vivian Stringer.

Phillips did not provide an explanation as to how Athletics deemed these specific purchases as essential during the fiscal emergency. 

“All purchases were reviewed in accordance with University spending guidelines to determine their necessity for Rutgers to excel in competition and meet our obligations as a member of the Big Ten Conference,” he said. “Exceptions are made for medical and other reasons.”

Saundra Tomlinson-Clarke, vice provost for academic affairs, told a meeting of the New Brunswick Faculty Council on Sept. 17 that there is still a University-wide hiring freeze in effect as well as restrictions on travel and discretionary spending.

Academic faculty have voiced frustration that they are being required to get special approval from a chancellor’s office for spending even a few hundred dollars from funds already in their budgets, even as spending by Athletics continues to spiral.

“The official University policy basically says, ‘We don't really trust you, faculty,’” Killingsworth said in regard to the spending restrictions. “(If) you want to spend 50 bucks on a book for your classes, you first have to get approval.”