Breaking Down the Rest of Maryland's Athletics Commission's Report

The big news to come out of the lengthy, long-awaited "Report of the President's Commission on Intercollegiate Athletics" (translation: "Report of the President's Commission on Saving Maryland's Athletic Department from Financial Hell") was, of course, the recommendation that Maryland discontinue seven sports. (Eight, technically, but c'mon: do people really count outdoor and indoor track as separate teams?)

That recommendation, though, accounted for only one of the 26 pages of the report. What was on the other 25 pages? What other changes are coming? Did they say to fire Randy Edsall?

No, actually, on the last one. As for the first two: read on. I went through the report to glean what information I could, so you don't have to. Check past the jump to see what else the Commission recommended in layman's terms, because I literally could not describe them in technical ones. But first:

How did we get here?

The Commission tackles this issue first and foremost, right up front. The answer is the same one that Steve Yanda at the Post explained several months ago. Maryland had accumulated "reserve funds" which were used to cover the yearly deficits, and those funds are now gone. Combine that with a failing economy, flailing revenue sports, and some questionable decisions (*cough*Byrd expansion*cough*), and you have a perfect storm of sorts. In the report's language:

The economic downturn of recent years and declining revenues have resulted in budget shortfalls. As a result, ICA's expenditures have exceeded its revenues. For several years, the annual operating budget (including facility debt obligations) has been balanced by transfers from ICA's accumulated fund balance (or "reserves"). Reserves are normally used for purposes such as these transfers. The ICA reserves are now depleted and transfers are no longer available to support the deficit. The budget shortfalls will grow in the coming years if the finances and operations of ICA are not changed. [Ed's note: ICA = intercollegiate athletics.]

Again: thanks to some strong fundraising years at the beginning of the decade (when the revenue sports were successful), Maryland had accumulated some pretty hefty reserve funds. These reserve funds were stashed away, and then taken from at the end of the year to cover the deficit the department had run up for the year. That, obviously, wasn't sustainable, and indeed the funds ran out in 2011. It seems no contingency plan was made for the situation when those funds ran out, and now there's nothing to make up for the yearly deficit.

That problem is exacerbated by downturns in revenues for both football and basketball. In the 2006 fiscal year, basketball and football brought in about $10.25million. In the 2011 fiscal year, which ended on Sept. 30, they brought in about $6.25million - a full $4mil difference. The economic downturn surely impacted that; then again, so did having uninspiring teams.

All in all: this situation is a result of poor planning, an unsustainable structure, an economic downturn, and some bad football and basketball.

How bad is it going to get?

Glad you asked. In short, pretty bad. If no changes were made, the projected total debt of the department by 2017 would be $17.2million.

So, yeah, they have to make changes.

And: Maryland's athletic department is lacking compared to others.

It would be a bit easier to swallow this deficit if Maryland's athletic department was some tricked out monstrosity, with hundreds of trainers and tutors and some absurd, drool-worthy student-athlete center.

In short, they don't. And not only are they not markedly better than their peers; they're actually markedly worse. To wit:

[O]ne [academic] advisor per 90 student athletes is considered optimal; at UMD, advisors are responsible for more than 155 student athletes each. ... In a recent poll of ACC schools, ICA determined that this places UMD 9th in the ACC with regard to space committed to academic support. [...]

UMD is one of only three ACC schools without a full‐time nutritionist...In a recent poll by ICA staff, it was determined that the University ranks 79th out of 131 BCS (Bowl Championship Series) schools [in athlete-to-trainer ratio]. The goal for UMD is to have 33 student athletes per trainer, which would place UMD 40th out of the 131 BCS schools.

Yes, our goal is to be 40th place.

Another way to put all this, as publicized by Liz Clarke a few weeks ago: Maryland is spending less per student-athlete than any school in the current ACC. When the ACC adds Pitt and Syracuse, they'll drop to 13th, ahead of only Syracuse.

Again: changes really do need to be made here. Not that you didn't already know that.

Change #1: Cutting sports.

They get right to it, don't they? And you've already heard about it. The only note-worthy thing I'll add here is the rationale for cutting sports:

[U]nder the current arrangement with the current number of student athletes and with the goals for excellence across the board, ICA cannot balance its budget. It also became apparent to the Commission that our current student athletes are not being supported at a level commensurate to their peers at other ACC institutions. It will take extreme circumstances to change this picture.

That is: we can't balance our budget, and we can't even support our student-athletes as well as everyone else. "Extreme circumstances," in this case, means "eight less sports." Which, of course, is the action they took. I seriously think this needs to be shouted from the rooftop when people start bleating about "not being numbers in a spreadsheet."

They also gave the factors they considered for cutting the sports they did, but they're not worth mentioning; it's everything you'd think.

Change #2: Revamp and improve fundraising.

This is one of those things that seems so much easier said than done. But they're not wrong about needing to fix it: fundraising hit a six-year low in 2011, and that hurts hard. They make a number of recommendations here, starting with a goal to move away from a "benefit-driven effort." That essentially means that they want to create a culture of giving; giving because you want to give, instead of giving because you want special access to tickets.

You do get that sort of atmosphere at a lot of private schools, but I'm not sure it's possible to do at a big state school like Maryland on the turn of a dime like that. They suggest putting 10% of funds raise back into future fundraising efforts, plus doubling donor visits and doing the requisite social media and website stuff. There's also several mentions of "rebranding athletics," something we've seen around lately. I'm not sure if they're suggesting something entirely new or if it's just saying to continue emphasizing the "Maryland" instead of the "Terrapins"; I'd guess the latter, but keep an eye out. Whether these will actually change the culture of the institution, I don't know.

They also suggest something I think is pretty cool: holding concerts in the Comcast Center. Most other universities do this, and I've never understood why it doesn't happen more at Maryland. From the outside, it seems like a no-brainer.

All told, they're shooting for a yearly 2.5% increase in Terrapin Club membership from 2013 to 2019, and they say "ICA should be able to meet or exceed its fundraising objectives" with a recovering economy. I'll have more on that figure in a bit, though.

Change #3: Reinvest resources in the remaning teams.

Really? Did they need to recommend this? What else are you going to do with them?

The good news, though: after making the seven/eight recommended cuts, the program suddenly becomes competitive with their ACC peers in money spent per student-athlete. Instead of being 13th in the new ACC (included Pitt and Syracuse), they'll jump to 6th. Throw in some more successful revenue sports, which may or may not come, and it could rise higher. Academic advisors for everyone!

Change #4: Reformat annual financial reports so that they "are more clearly stated."

Is that a Debbie Yow burn? Maybe. (If it is, they just got a bunch of new fans.) We've heard plenty about her using some ... inventive mathematics to claim a balanced budget. Like, oh, the thing we talked about above that got us into this mess. That the Commission actually had to recommend for the athletic department to be "accountable for routine reports about its finances," is a bit of a head-scratcher.

So is that it? Are things fixed now?

Well, that's the projection. I quote:

If these recommendations are implemented, and ICA and the University are successful in their efforts, the Commission expects ICA to begin to show a balanced operating budget in [2015], begin repayment to the University in [2015], complete repayment in [2019], and begin accumulating reserves in [2015].

Sounds good. The only question: "if ... ICA and the University are successful in their efforts"?

That certainly leaves a fair amount of wiggle room, especially when the report also contains language like: "the Commission is confident that both [football and basketball] will become nationally competitive in the coming years." (That was said, for what it's worth, in reference to fundraising. The obvious connection being that successful sports correlates to more funds raised.)

I mean, sure, there's that hope out there. But I'm not sure if any sane person looks at the current situation of Maryland football and says, "That's a program I'm confident will become nationally competitive." It could happen, but expecting it to happen? Ergh.

I'm not sure if they're actually relying on that, or if that's a throw-away statement. Frankly, it looked more like the former than the latter. Hopefully they're being very conservative in their estimates, because I wouldn't like to see the figures if "national competitiveness" turns into "consistent 4-8 seasons and a multi-million dollar buyout." Does poor performance from the football team - or, for that matter, the basketball team - turn that aforementioned 2.5% yearly increase in TC membership into 0.5%?

In summary...

Maryland's athletic department is obviously in a lot of debt - again, a projected $17mil by 2017 - but by cutting sports and raising a few more funds, things should more or less sort themselves out by 2015.

The most direct way to fix this mess, though, obviously lies in the success of the revenue sports. If men's basketball and football do become nationally competitive, the department sees an influx of money: more ticket sales, more merchandise sales, more suites purchased, more donations brought in. The problem would just about solve itself. If not ... those fundraising numbers might be a bit more difficult to reach. It seems strange to read 26 pages that has only one sentence explicitly about that topic (the one mentioned above), but that's the reality of the situation, and it needs to be the focus of Maryland's athletic department. The stakes for Mark Turgeon and Randy Edsall are really high right now, and they're much higher for Kevin Anderson, the man who hired both those coaches.

That last paragraph isn't to say that they shouldn't have made cuts or recommend better fundraising, mind you. Maryland's athletic department was an inefficient beast. It was certainly bloated. Even when/if the revenue sports were successful they had trouble providing a good experience for the student athletes. They haven't turned a profit or even broken even in years. Changes certainly had to be made right away, and even two successful revenue sports would only be masking, not solving, the problem. This is a step towards that.

It was a terrible situation for Kevin Anderson and Wallace Loh to walk into, and I feel bad that they have to come in and be the bad guys, making cuts and pissing people off. But that's the hand Maryland has right now, and that's the easiest way out of it that I can see.