Dave Brandon projects $137.5M University of Michigan athletic department budget
University of Michigan athletic director Dave Brandon on Thursday presented a $137.5 million fiscal 2013-14 athletics budget, saying his department is financially stable but expensive to run.
University of Michigan Athletic Director Dave Brandon addresses regents at meeting on Thursday, June 20, 2013 at the Michigan Union.
Melanie Maxwell | AnnArbor.com
Next year's budget is $11.6 million more than the this year's $124.5 million budget. This year the athletic department ended up spending $1.3 million less than expected.
Brandon expects $49.3 million in revenue from game tickets and $33.2 million in donations for preferred seating and other gifts. The ticket revenue is derived mainly from football, basketball and hockey games and is increasing $4.6 million over 2012-13. The athletic department raised the price of student tickets for home football games 23 percent this year and increased seat donation prices for most football season ticket holders.
Another reason for the revenue increase: the 2014 National Hockey League Winter Classic is scheduled for the Big House in January. The event was scheduled for 2013, but was canceled due to a league lockout. The NHL has agreed to pay U-M $3 million for use of Michigan Stadium.
"It feels really good now that it's back," Brandon said.
The athletic department's largest expense is wages and benefits —which run $48.8 million, or $4.7 million more than last year.
"I tell our coaches we have an unlimited budget for achieving championships and receiving incentive-based pay," Brandon said.
Athletic scholarships are projected to cost $19.7 million. Team expenses, projected at $22 million, are increasing because cheerleading is newly under the purview of the athletic department and women's lacrosse is competing for the first time next year.
Brandon also said that a proposal to replace the ice making and maintenance equipment in Yost Ice Arena would come before regents soon. The cost of replacing the aging equipment is between $3.5 million and $5 million, he said.
"It's expensive to make ice," Brandon joked, explaining that seemingly straightforward projects are costly. "People are sometimes amazed with the fact that it costs $6 million to paint Michigan Stadium."
The athletic department is in the midst of $14.3 million in construction projects, with another $341 million in projects planned until 2019, including a new swim center, track stadium and administration building.
"As we move down the road we'll get a little bit crisper in terms of the projects that you've approved," Brandon said. "Those are straw man numbers that give us some sense of the scope and scale of these things."
The department is has $386 million in net assets, a $64 million endowment and $231 million in debt.
Kellie Woodhouse covers higher education for AnnArbor.com. Reach her at kelliewoodhouse@annarbor.com or 734-623-4602 and follow her on twitter.
Comments
glacialerratic
Sat, Jun 22, 2013 : 1:08 a.m.
This athletic department is on steroids. And how many "student-athletes" does this massive budget benefit? The Regents and administration have let things get way out of balance, perhaps irretrievably.
Mich Res and Alum
Sat, Jun 22, 2013 : 7:15 p.m.
I don't know why student-athlete is in quotations. It benefits hundreds of student-athletes. It benefits thousands of students who do not participate in intercollegiate athletics but do participate in intramural sports, utilize facilities, have internships and campus jobs with rec sports and the athletic department, and the students who wish to pursue a career in athletics. Yeah, I'm not thrilled at all by the "unlimited coaching budget" comment. That is certainly a regrettable thought. However, the athletic department DIRECTLY benefits far more students than just those that represent the block M on the fields.
Glenn Galler
Fri, Jun 21, 2013 : 8:06 p.m.
If you look closely at all of the building renovations, you will see that they are done on a floating platform. This is to allow Dave Brandon to move the buildings to New York City when he determines that he can make more money there than in Ann Arbor. The "Real Michigan Fan" will move with the teams and the buildings to New York City. Those that stay behind in Ann Arbor are obviously not real Michigan fans. It was only in the good ole days that we Ann Arbor-ites could take pride in our University of Michigan teams and we could actually afford to go to the games with our families. We should take pictures of the buildings now so we can tell our grandchildren that there used to be college program in Ann Arbor, Michigan, and we used to be able to afford to attend the games.
teeters
Fri, Jun 21, 2013 : 2:06 p.m.
Glad to see that the increase in student ticket prices helped the athletic department get higher into the black.
teeters
Fri, Jun 21, 2013 : 8 p.m.
I think that the point of the argument is being lost on $$$ specifics. All the fees and increased fees are still lower than the profits. Thus, there should be no imposed fees and no increases to ticket prices. Remember, these are STUDENTS, without them there are not athletic teams or gyms to renovate.
Kellie Woodhouse
Fri, Jun 21, 2013 : 4:39 p.m.
Hi there! The majority of the revenue from the student ticket price increase will go to pay for renovation unions and gyms, as will the $65 fee for students, which starts fall 2014, as will about $1M from U-M parking annually. The fee has a 30-year lifespan. http://annarbor.com/news/funding-university-of-michigan-gym-renovations/
teeters
Fri, Jun 21, 2013 : 3:27 p.m.
Actually, a $60 student fee increase was to pay for those improvements, although the student ticket talking points by the AD were to "justify" the increase. So with the student ticket increase and the fee increase that is ~$3.5-million, way less than a $8.9 million surplus.
hail2thevict0r
Fri, Jun 21, 2013 : 3:15 p.m.
As far as I know the increase in student tickets was to pay for the renovations on the IM buildings that students use.
MRunner73
Fri, Jun 21, 2013 : 1:52 p.m.
What should not be overlooked at this budget is the fact that there are continuous upgrades to all of the athletic facilities. Yost Ice Arena is very old and someday, the foundation of that building will be substandard. It does gobble up a lot of money to maintain/modernize. Track needs and will eventually get new facilites. Not to mention field hockey, softball and baseball projects. Glad to see nearly all of the revenues are going back to the facility upgrades.
hail2thevict0r
Fri, Jun 21, 2013 : 3:15 p.m.
I suspect that, unless demand for hockey tickets goes way up, Yost will be the facility for quite some time. Especially since they just did the upgrades on it. Since it seems that Brandon is redoing every facility on campus I'd imagine every 10-20 years we're going to go through a similar upgrade cycle.
aareader
Thu, Jun 20, 2013 : 11:33 p.m.
As long as TV, fans, etc, are willing to pay the ever rising costs (ticket prices and "seat licenses") then there are "no worries" about the comment - "I tell our coaches we have an unlimited budget for achieving championships and receiving incentive-based pay," Brandon said." In spite of all that it is always GO BLUE.
MRunner73
Fri, Jun 21, 2013 : 1:54 p.m.
That is the same philosophy throught NCAA Div 1. Are the Spartans less committed? It is not just a GO BLUE thing.