While you are pondering exactly how UCLA is going to finance its various real estate deals (including the $700 million Westside Pavillion purchase), you might let you mind drift towards athletics where we are supposed to be turning a profit. From the Mercury News:
Months away from joining new conferences, UCLA and Cal might consider changing school colors before going their merry ways. A deep red hue seems appropriate. The Bruins and Bears continue to bleed cash as they prepare for life in the Big Ten and ACC, respectively. According to documents obtained by the Hotline, the two athletic departments posted a combined deficit of more than $80 million in the 2023 fiscal year when support from central campus is removed from the equation.
Without a course change, the grim financial trajectories in Westwood and Berkeley could undermine success on the field (and court) in their new leagues against peers with stronger fiscal foundations. For the fiscal year ending June 30, 2023, the Bruins reported revenues of $105.4 million and expenses of $142 million — a deficit of $36.6 million. The revenue total represents a 2.2 percent year-over-year increase while the expense figure marks a jump of 8.2 percent. No single item accounts for the uptick in UCLA’s operational expenses. However, the lifting of COVID restrictions and a change in the football schedule, which resulted in eight home games during the 2022 season, were key contributors.
Regardless of specifics, the bottom line is all too familiar for the Bruins, who reported a $28 million deficit in the 2022 fiscal year and were running deep in the red before COVID hit. “Like other athletic departments, financial challenges remain as a result of the pandemic which impacted revenue streams such as sponsorships and media rights,” the Bruins said in a statement issued to the Hotline.
“In this evolving college landscape, we have continued to emphasize putting our student-athletes first. This includes increasing our investments in student-athlete focused areas including mental health, team travel, nutrition and academic awards. “We will always put our student-athletes first and provide a world-class holistic athletic and academic experience.”
The situation in Berkeley appears significantly more dire. The Bears reported revenues of $126.1 million and expenses of $134.9 million in the 2023 fiscal year, a deficit of $8.8 million. Those figures represent year-over-year increases of 6.6 percent (revenue) and 17.8 percent (expenses). That eye-opening surge includes a $6.5 million increase in costs for coaching and administrative salaries — the Bears fired one men’s basketball staff and hired a new one — and a doubling of the dollars spent on fundraising and marketing, to $8.1 million, that was partly due to efforts related to the football game at Notre Dame in the fall of 2022.
What’s more, Cal’s revenue includes a whopping $36.7 million in direct support from campus — that’s 29 percent of the total revenue and a $5.7 million increase in raw dollars over the support level provided in the 2022 fiscal year. (The revenue figure excludes $3.4 million that the Bears transferred back to campus as part of an internal financial structure.) ...
Full story at https://www.mercurynews.com/2024/01/17/financial-challenges-intensify-for-ucla-cal-with-several-daunting-hurdles-ahead/.
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