$ Impact to Big 10 to Cancel All Fall Sports

IlliniHusker

IlliniHusker

Five-Star Recruit
There has been lots of talk about the loss of the 2020 football season for NU and the entire Big 10.  Wondering about the financial impact for all the Big 10 schools with no football revenues, no Bowl game income, no basketball & no NCAA March Madness, no volleybal and no TV revenues from all these sports.  (Surely TV would keep paying the Big 10 to show re-runs.)   Will Big 10 administrators also feel the pain?  If the financial impact for Big 10 members is down 50% say, will the Big 10 leaders/ administrators have a 50% cut in their salaries?  

 
IlliniHusker said:
There has been lots of talk about the loss of the 2020 football season for NU and the entire Big 10.  Wondering about the financial impact for all the Big 10 schools with no football revenues, no Bowl game income, no basketball & no NCAA March Madness, no volleybal and no TV revenues from all these sports.  (Surely TV would keep paying the Big 10 to show re-runs.)   Will Big 10 administrators also feel the pain?  If the financial impact for Big 10 members is down 50% say, will the Big 10 leaders/ administrators have a 50% cut in their salaries?  
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Good question about the cut in salaries. A lot of coaches (including Frost) have announced they are taking a pay cut, so that's something.

I've heard that some conferences may attempt to get a loan to help cover their expenses in a year with no sports, and they'll hope to pay that off with a big new TV contract in the next few years (the Big Ten's is up in 2023). 

The SEC's deal runs into the 2030s, so that may play a role in their decision to try and play. With no renegotiation cushion, if the SEC, ACC & Big 12 can't play and forfeit their revenue this year, they're going to have to borrow against fixed future revenue.

 
southernoregonhusker said:
The Pac 12 cancelled all fall sports and I've read that Oregon State is considering a loan.  I wouldn't be surprised to hear the whole conference doing the same.
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Like a bond? 
 

interesting. Not sure how secure it would be. If universities make it up over time, why don’t they just trim the budget? Are new building really necessary? 

 
krc1995 said:
Like a bond? 
 

interesting. Not sure how secure it would be. If universities make it up over time, why don’t they just trim the budget? Are new building really necessary? 
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solid point, there's so much f'n fat to trim too...

When i think of college football ,think of all the universities (including this one) that spent millions of dollars just to get rid of a coach and bring in a new coach for millions, only to then get rid of that coach for millions to get someone else... Didnt' we just get done having 3 Head coaches on our books between pelini, riley and now frost?

Just one small example but i feel like is one that is going to see a big change in the immediate aftermath when we come out of this... overtime, things will probably get back to the same but i have to imagine some of these "thanks dont hit the door hit ya as you leave" pay offs are really hitting some of these schools hard

 
southernoregonhusker said:
For sports?  
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Athletic Depts are NOT the University as such, at some schools such as UNL.  NU athletics is a part of the University but has long remained fiscally separated and emancipated if you will.  This was done purposefully to try to avoid all the campus politics and ebb and flow of things such as budgets and administration.   If the ath dept is run independently with self funding, it retains some greater independence from political winds, etc.  The focus is on sports.  Politics stopped at the gates to the stadium/arena and fans were all united for Husker wins. 

The politicization of pandemic (never ever should have been sadly) as well as the politicking going on in sports and in businesses across society is very dangerous frankly.  

The very future of sports is threatened by all this.  

 
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southernoregonhusker said:
For sports?  
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I would think bonds have been issued in the past to do initial funding of construction projects related to sports. Then the athletic department pays off those bonds with donations and future revenues. Now, I’m not sure if bonds can be issued to fund general expenses, but the Universities May be able to get around that by issuing bonds thru the general fund and then put money into the the athletic department. 

 
ColoradoHusk said:
I would think bonds have been issued in the past to do initial funding of construction projects related to sports. Then the athletic department pays off those bonds with donations and future revenues. Now, I’m not sure if bonds can be issued to fund general expenses, but the Universities May be able to get around that by issuing bonds thru the general fund and then put money into the the athletic department. 
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I think that would cause quite the stink around here knowing some of that money would be going to coaches making millions.  

 
southernoregonhusker said:
I think that would cause quite the stink around here knowing some of that money would be going to coaches making millions.  
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Issuing bonds is a legitimate source of raising capital. Yes, it can be troublesome using debt to pay off short-term operating expenses, but I don’t see anything wrong with a University having low-interest debt on their balance sheet. 

 
ColoradoHusk said:
Issuing bonds is a legitimate source of raising capital. Yes, it can be troublesome using debt to pay off short-term operating expenses, but I don’t see anything wrong with a University having low-interest debt on their balance sheet. 
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It is an unprecedented situation the many schools are dealing with but all are already likely issuing bonds / IOUs and tapping all the ‘political goodwill’ they have with States’ legislative branches for extra budget moneys to fund academic side of operations. On campus vs on-line instruction?  Housing, dorms, parking, registration, tuition, books (do they use those anymore? lol), etc. Extra security/policing, testing, space usage, staff working from home?, 

all are throwing big wrenches in academic side.  Probably 5 to 10 times in financial costs vs sports. 

Bonds issued impacts credit ratings and the interest rate for future bonds. Also, there are some statutory bond limits for non-capital expenditures of public entities which may be needed for the Universities’ survival themselves - now and in the future 2021 and following.  This virus may be around forever if other flus and pneumonias are any indication. 

Yes deaths and hospitalization rates are declining and the peak was in April, despite all the massive overhyping of the fake news media.  But the virus is still alive and spreading, as predicted.  

All the social distancing and masks and self quarantine has slowed the spread but did not and cannot stop or kill the spread. It has likely lengthened the epidemic for years.  Bonds are very risky I would think for big investors though ratings could be good for awhile.  But the downside perception in the bond markets could be amplified by the election uncertainty as well.  The FED has been ‘printing money’ like there’s no tomorrow- lets hope the FED is wrong on that.  

Final point might be that the economic recovery is amazing currently but there is a very ominous aspect to the damage done by the long term shuttering of so many businesses.  Many will not reopen or survive even if they try. 30% of NY city restaurants are never reopening, for example. 

Mall outlets and shop spaces with no tenants.  There is a potential real estate mtg default tsunami coming as millions and millions of loans have been allowed to go past due. The ocean has mysteriously receded but will the water return as a ripple or tidal wave?  

 
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