Blue White Illustrated

After the pandemic shut down col- lege sports in the spring of 2020, Penn State administrators tried to anticipate the potential financial im- pacts on the athletic department. Their initial conclusions were dire. "At one point, we were projecting losses of perhaps over $100 million, with eventually the need for about a $50 to $75 million loan to cover that deficit," athletic director Sandy Bar- bour said during an appearance on the virtual Coaches Caravan in early June. But the Big Ten's decision in Sep- tember to go forward with a shortened football season, coupled with austerity measures that Penn State imposed last summer, helped ensure that the worst-case scenario never came to pass. In its 2019-20 NCAA Annual Fi- nancial Report, Penn State's athletic department showed that it continues to be self-supporting. During the 2020 fiscal year, Intercollegiate Athletics re- ported $165,077,390 in net revenues and $157,908,311 in total expenses, fin- ishing the year with a positive balance of approximately $7.17 million. "In unprecedented times, Penn State Athletics continues to be a strong, self-supporting unit," Barbour said in a prepared statement. "We saw modest gains in revenues, despite unanticipated revenue losses due to the cancellation of the NCAA Men's Basketball Tournament. We were able to implement cost-control measures in FY 2020 to assist us in minimizing our anticipated revenue shortfall in FY 2021. We remain vigilant in our ex- pense management, while creating conditions for success for our stu- dents and achieving comprehensive excellence throughout ICA." Penn State's athletic department does not receive any funding from the state, nor are any student fees di- rectly allocated by the university's central administration. Part of the decrease in expenses stemmed from the cancelation of the spring sports season and the morato- rium that the NCAA placed on in- person recruiting early last year. In addition, Penn State instituted de- partment-wide pay cuts ranging from 5 to 10 percent. While the athletic de- partment is still anticipating a rev- enue shortfall during the 2021 fiscal year, that shortfall is not in keeping with the university's original projec- tions. Barbour said Penn State's budgetary outlook began to improve after the austerity measures were imple- mented. "We began to see the results of our extensive expense savings, and that gap started to come down," she said. "We're fortunate enough to have some reserves, and that continued to bring it down even more. So as we started our budgeting process for fis- cal year 2021-22, we were using the planning number of having to borrow about $25 million. We've continued to bring that down, and we think we might have that number down to be- tween $18 and $20 [million], and the university will provide us access to a line of credit to help us address that gap. "So we'll continue to chip away at it and pay it off as quickly as we possi- bly can," she added. "What we don't want is to have what I've referred to financially as a COVID hangover. We don't want COVID to impact us for years to come." –MATT HERB A D M I N I S T R A T I O N PSU athletics still self-sucient despite pandemic's impact throughout the wider community. Its findings will be used to make recom- mendations concerning the stadium's near- and long-term maintenance needs, look for ways to improve the fan and student-athlete experience and seek potential partnership opportunities. Barbour said Penn State will be look- ing at uses for the stadium that go be- yond the needs of the football program. "We're talking to a lot of different constituents, on campus and off, about what our needs are, and looking at hav- ing Beaver Stadium as an asset to our community that's used more than eight or nine days out of the year," she said. "What other activities, what other ben- efits to the community can be housed at Beaver Stadium that would make it more than an eight-day-a-year facility?" The Populous team is led by Penn State graduates Scott Radecic and Jeff Funovits. Radecic was an All-America linebacker on the Nittany Lions' 1982 national championship team and went on to play 12 seasons in the NFL after being chosen in the second round of the 1984 draft by Kansas City. "It's both a personal and professional honor to work with Penn State again," said Radecic, Populous senior principal. "Our relationship with the university and [Intercollegiate Athletics] goes back 25 years, but it's always been the for- ward-looking nature of our work that has been the most rewarding." Added Funovits, Populous principal and planner, "Years after my first game as a freshman, I still hear the chants of 'We are' echoing off the seating bowl at Beaver Stadium. We're thrilled to help make the stadium a bucket list destina- tion and memory maker for generations to come." The study will be conducted through- out the summer of 2021 and will examine more than just potential upgrades. Said Barbour, "We're also looking at long- term maintenance, making sure we have a solid long-term maintenance plan, as well as the funding plan for the renova- tions. It's a big step and a huge project and one that I know our entire commu- nity joins in looking forward to." ■

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