ECU officials: Athletic finances are solid
By Nathan Summers
The Daily Reflector
Sunday, March 18, 2018
East Carolina officials defended the tenure of Athletics Director Jeff Compher and disputed statements about the financial health of the athletics program reported in a Daily Reflector commentary published last week in the sports section.
The department's finances remain healthy in the wake of Compher’s five-year term, ECU Chief Communications Officer Tom Eppes said during a meeting with Reflector staff. He said ECU athletics increased annual revenues from $33.8 million to $40.7 million under Compher, who accepted a buyout to leave the school March 9 amid criticism from the fan base and successive losing seasons on the football field.
Speaking alongside retiring Vice Chancellor for Administration and Finance Rick Niswander and Pirate Club Executive Director Phillip Wood, Eppes also said a deficit between revenues and spending reported in the March 11 commentary was inaccurate. He said the newspaper relied on faulty sources and failed to confirm figures with the university.
According to numbers provided Thursday by Niswander, the department enjoyed a $2,157,786 surplus when Compher came to the university, not the “estimated $3.5 million” reported by “multiple Pirate Club members” to the Reflector. The current estimated total deficit is about $3.3 million, not nearly $7 million as reported in the commentary.
Eppes said the deficit is largely the result of $3.4 million in costs associated with leaving Conference USA and joining the American Athletic Conference. An NCAA rules change and scholarships supported by athletic funds and the addition of women’s lacrosse also contributed to the tune of about $4 million, Eppes said.
Revenue increases resulting from several contract upgrades, including a $14.3 million deal with IMG Marketing and a $16.5 million agreement with addidas, will have a “significant positive effect on debt and the overall budget” once conference entry payments have been completed in 2019, Eppes said.
“The last payment will be made next year,” he said. “At that point, all the money is coming in without all the expense and things are going to right themselves pretty quickly.”
The ECU officials also responded to concerns about the sale of reconfigured seating to help pay for a $55 million football stadium renovation. Sales have been strong, Eppes said. Fans have purchased 245 of the 1,000 club seats, all 22 loge boxes and all 18 suites, and three of five Founders Suites.
The Reflector’s commentary also incorrectly reported the interest rate ECU is paying on the $55 million line of credit it secured from BB&T for the stadium project, Eppes said. The rate is approximately 2 percent, not 5 percent, he said.
“The funding model for the project takes into consideration the interest that will need to be paid,” he said. “Still, the model conservatively projects a net revenue of $582,563 in 2019.”
“The guy accomplished a heck of a lot,” Eppes said of Compher, denying anonymous complaints reported by the Reflector that Compher spent freely on dinners for Pirate Club donors, saying the average meal for a donor was $75, an average he said was “not extravagant.”
Eppes went on to indicate the average donation from the people eating those meals was $19,989 annually. The university’s fundraising efforts under Compher also totaled nearly $80 million in five years, Eppes said.
The officials also questioned the Reflector’s reporting of cost-cutting measures as evidence of what the university was facing because of an “expensive five years” under Compher.
Eppes said the school was exercising “good business sense” when it cut back on media meals and placed controls on snacks provided to football players. Free access to player nutritional supplements meant more was taken than one person could consume, he said.
“Some people may grab some, who knows, to take to some buddies to share the food or the refreshments. Who knows what happens to it?” Eppes said. “If you want manage your money better and manage your supplies better, then maybe you give it out individually and just don't put stuff out on the table that people are maybe going to take more than they needed.”
He also said the department is not leaving media relations positions vacant. A post left open by the departure of a staff member in December likely will be filled this summer, he said.
The officials said the department’s finances are especially impressive considering a North Carolina law that prohibits universities from funding athletics through tuition and other appropriations — a law that means ECU receives about $17 million less in direct institutional support than most other American Athletic Conference schools.
“The amount of spending per athlete is below average in the conference, so we're not spending at a crazy level,” Eppes said of the program under Compher, who will remain in place until May under the $1.3 million buyout agreement finalized last week. “So to characterize Jeff's work as being frivolous with money is a mischaracterization and I think the data is there to support it.”
Contact Nathan Summers at email@example.com, 252-329-9595 and follow @NateSumm99 on Twitter.