East Carolina athletics already was dealing with losses in the millions of dollars in recent years before the COVID-19 pandemic only added pressure to the Pirates and other athletic departments nationwide.
On Monday during a special ECU Board of Trustees meeting to publicly update Pirate athletics and finances, second-year athletics director Jon Gilbert broke down the difficulties of preexisting challenges combined with the current and ongoing situation surrounding the pause on college sports. ECU has scheduled another special Board of Trustees meeting for Thursday.
“We really had two parallel issues that we were dealing with at the same time,” said Gilbert, who also on Monday emphasized the revenue distribution hit caused by the cancellation of this year’s NCAA basketball tournament in March. “There was the sustainability report on where our athletic finances have been over the last several years, and then COVID-19 and the realities of what those financial pressures would be. They were running down parallel tracks and obviously are crossing one another now.”
An email from the university Tuesday said Thursday’s meeting is “For the purposes of considering confidential personnel information and information protected under the Family Educational Rights and Privacy Act, as well as to consult with an attorney.” The meeting agenda calls for a period of closed session.
At the forefront of possibilities for Thursday is whether the Pirates will decide to discontinue any sports, which is a practice that has become common for some universities in recent weeks.
The ECU athletics fiscal sustainability report highlighted that ECU sponsors 20 sports, which is most in the American Athletic Conference (excluding outgoing Connecticut) and consists of 11 female and nine male teams. Four AAC schools sponsor 19, Tulane is at 18, three more 17 and UCF 16.
A school’s number of sports is tied in many ways to scholarship rules and Title IX compliance. The NCAA mandates that Division I-A head count sports — for full scholarships — are football, men’s basketball, women’s basketball, women’s tennis, women’s volleyball and women’s gymnastics. All other sports are equivalency sports, meaning partial scholarships can be awarded.
East Carolina sponsors all of the head count sports except for women’s gymnastics. ECU hasn’t cut a sport since men’s soccer in 2005.
“This was a significant challenge before COVID, and it is a daunting challenge with COVID,” Board of Trustees chair Vern Davenport said during Monday’s meeting. “Add the uncertainty with the fall, both from students on campus and athletically, I don’t know if I have the right words to describe the challenges associated with that. ... This is a not one-and-done with the decisions you guys have to make in the next few days and we’ll continue to monitor the situation and make the management decisions that have to be made on the other side of that.
“I think all of us collectively have our fingers and toes crossed that we are successful in getting our students back on campus and getting back to Pirate football and Pirate athletics as we move into the fall.”
ECU originally projected $43,440,503 in athletics expenses and $36,039,243 in athletics revenue for this fiscal year, which ends June 30. Gilbert is now expecting a deficit of likely $8-10 million while maintaining the situation is fluid during the current unpredictable environment.
“I would tell you, today that our anticipated deficit, if I had to put a number on it, would be around $10 million,” he said. “But that revenue number will continue to decrease and we also have had substantial savings from not participating in spring sports and effectively shutting down our departmental operations and expenditures. I think that $10 million number, if we continue to get Pirate Club donations and some other revenue streams continue to come in, that deficit is going to close the gap. I don’t believe it will close the gap to the original $7.5 (million deficit projection), but I do think there’s strong potential for it to go down significantly.”
Cuts already decided by Gilbert and his leadership team are for teams and departments to implement budget reductions of 10 to 20 percent. Gilbert also said he declined performance bonuses and told ECU Interim Chancellor Ron Mitchelson he would take a 20 percent compensation reduction for at least one year.
Future university projections include for the next fiscal year a $5.6 budget deficit in athletics, plus an additional $3.8 million in capital investments, and in the fiscal year of 2022 an athletics budget shortfall of a minimum of $4 annually in perpetuity. Those projections correlate to one of the recommendations in the working group report that suggested a need of $4-6 million annually transferred from institutional funds in support of ECU athletics.
The Pirates currently rank in the bottom half of the American Athletic Conference in athletics revenue and expenses. For now, a priority is on the hope for playing a full football schedule this year.
“Our revenue projections are largely dependent upon students and school being back in the fall, and football playing as normal,” Gilbert said of next year’s budget.