I’m a fan of Rutgers football and got my masters degree from the Eagleton Institute of Politics at Rutgers University.
Nonetheless, I’m also really concerned that the sports program (mainly football) has been bleeding scarlet ink since Rutgers joined the Big Ten Conference in July 2014.
According to an in-depth and detailed analysis of Rutgers Athletics’ finances conducted by The Record and NorthJersey.com, “Rutgers Athletics currently faces approximately $ 265 million in unpaid debt, nearly half of which is associated with the costs of operating the Big Ten Conference. In order to cover some of these operating losses, Rutgers loaned the sports department $ 84 million over six years. This was reported as income, which at the time was against University and NCAA guidelines. Loans were only authorized for capital projects. In addition, according to the aforementioned in-depth analysis, the sports department also took out loans of $ 48 million from the Big Ten Conference.
These practices have been called “unsustainable” by the new president of Rutgers, Jonathan Holloway. Everything indicates that the deficits have worsened this year due in large part to the COVID-19 pandemic. Under the terms of the deal Rutgers made with the Big Ten in 2014, they will receive their first full Big Ten cast of $ 65.2 million in 2027. With a 2019-20 sports budget of $ 114.2 million. dollars and assuming a very modest 3% annual increase in the annual sports program budget, the Big Ten payment will cover less than half of Rutgers’ future sports budget. And that does not include the potential debt service of an estimated $ 150 million football field that had to be built if the project reached a private finance commitment level of at least fifty percent. percent of total expected cost.
Suffice it to say that it looks like football’s deficits will continue to grow endlessly and could ultimately cause irreparable damage to the university and its academic priorities unless something dramatic is done.
In a column I wrote on September 28, I naively suggested that Rutgers should quickly organize a series of fully transparent public hearings around the state to get comments from a wide range of sources regarding the deficit, hidden loans and what should be done about it. I say naively because Rutgers has a long history of being anything but open when it comes to funding athletics in college. There is no indication that they will voluntarily shed light on what happened.
This view was reflected by Becky Givan, associate professor, social studies and labor relations at Rutgers and president, Rutgers AAUP-AFT, who in an appeal said the problem was not just the subsidization of athletics. but the complete lack of transparency at a public institution. “Professor Givan indicated that during the most recent negotiation this winter and spring (and not regular contract negotiations) between the faculty and the university,” the magnitude shady grants and accounting policies were hidden. ”The university was not“ forthcoming and did not disclose tax information. ”They claimed they were facing a“ budget emergency ”and that that was the reason why they “had to cancel the salary increases”.
Here are some of the questions that require answers and which will only be addressed if Rutgers is forced to be frank:
Who authorized the bogus claim for “loans” from the Sports Department and when was it authorized?
When did the Board of Governors and the Board of Directors learn of the false statement? When did senior managers find out?
Was President Holloway aware of the false statement prior to his appointment? How and when did he find out?
Who authorized the false response from public records and invented the idea of a “loan”? Has anyone been sanctioned, fired or formally reprimanded for their role?
Were the Board of Governors and the Board of Directors aware?
How are “loans” described in other university financial statements and in reports to government officials?
If loans have already been reported as income, how were expenses from university funds accounted for? What was the supposed source of the income?
Has there been a coordinated cover-up to prevent the public from knowing about loans and the amount of deficits?
It’s time for the New Jersey State Comptroller’s Office (OSC) or the New Jersey State Board of Inquiry (SCI) to objectively take a look at what happened at Rutgers and decide if it s it is stupidity, gross incompetence or fraud and whether a cover-up has taken place.
My first instinct is to suggest a review by the OSC, which is responsible for examining all aspects of government spending to ensure that it is done in an efficient, accountable and transparent manner. The scope of the CSO’s responsibility includes auditing the performance and effectiveness of state colleges and universities. If the CSO uncovers a fraud, the case could be turned over to the SCI, the independent state-run government investigative agency whose mission is to identify and investigate organized crime, corruption and theft. waste ; and fraud and abuse in government spending by state, municipal and school bodies.
My suspicion is that what happened was more about stupidity, incompetence and lack of transparency. If this is the case, quite significant staff changes will be required, which will depend on who knew what and when. A new approach and plan will need to be developed to adequately support a competitive football program without undermining the university’s core mission of education, research and service.
As Professor Givan pointed out, the university must specifically ensure that funds are available to restore library cuts, restore class sizes to previous levels, reduce pressure on professors to teach. more courses and finally to ease the budgetary restrictions imposed on university departments in many areas.
The long-term solution cannot be bigger and bigger football subsidies or additional debt without guaranteed sources of income to pay it off. Nor can Rutgers continue to rely on increases in compulsory tuition fees or borrowing from university departments. There must be a new policy that makes it clear that the huge deficits accumulated by the football program cannot grow in perpetuity.
To put it another way, Rutgers must take a financially conservative approach to athletics. The administration and its governing bodies must re-engage on the simple and prudent premise that they will not build anything unless they have raised the money for it in advance. Now is the time for Rutgers to end its continued indebtedness to support its athletic programs. The football program must be self-financing. Not a penny from college is expected to be spent on the $ 150million planned for the indoor football facility, even if that means coach Schiano can step out of his eight-year, $ 4million contract without penalty. of dollars per year that includes building the practice. establishment. It is a luxury the university cannot afford.
Irwin Stoolmacher is President of the Stoolmacher Consulting Group, a fundraising and strategic planning firm that works with nonprofit agencies that serve the most needy among us.