Director of Athletics Kevin White and several other administrators addressed the Academic Council Thursday about the challenges and opportunities facing the athletics department.
The presentation touched on a number of issues regarding the changing landscape of the athletics program at Duke and around the country. One of the most significant challenges is the budgetary constraints imposed by the economic downturn, White said.
“It’s really become quite a pretty important focus for an intercollegiate program to become fiscally responsible,” White said. “We’ve made inroads but there’s a lot to do.”
The Duke Athletics budget has grown exponentially in the last two decades. According to federal documents submitted in compliance with the Equity in Athletics Disclosure Act, expenses for the department totalled $9.9 million from July 1995 to June 1996. In the current fiscal year, the Department of Athletics is attempting to balance a $60.3 million budget, said Mitch Moser, associate athletic director for business operations.
This year, the Athletics Department faces unique hurdles in generating revenues than in years past. The Iron Dukes—the fundraising arm of Duke Athletics—shattered records in fiscal year 2009, raking in $12.6 million in contributions, Iron Dukes Executive Director Jack Winters said in an interview earlier this month. This year, they are tracking $1 million behind where they were last November.
The cost of funding athletic scholarships alone is more than $13 million, according to the EADA report for 2008-2009.
Revenues from all sources are down about 7.5 to 8 percent, Moser said at the meeting. He said in an earlier interview that the athletics endowment has also taken a hit as a result of the recession, going down in market value from $150 million in June 2008 to $113 million at present.
At the same time, the University has reduced its annual subsidy to the athletics department from $15 million in the last two years to $14.5 million this year, Moser noted, with further reductions planned for next year.
“We’re working very, very hard to weather the financial storm like other athletic departments,” Moser said. “We’re doing everything to contain our costs without impacting the student-athlete experience.”
To that end, White convened an Executive Budget Committee last August made up of senior-level athletics administrators to look at specific areas where the budget could be trimmed. So far, Moser said Athletics has cut expenses by 5 percent.
Administrators have also been looking at additional sources of revenue. They have signed a deal with Nike for apparel and equipment as well as International Sports Properties, Inc., a Winston-Salem based sports marketing company.
Duke is not the only Division I school whose athletics department is showing signs of strain in confronting a new financial reality. Facing layoffs and a $8-million budget cut, Stanford University’s athletics department is considering doing away with one or more of its 35 teams. Athletics at the University of California, Berkeley also finds itself in turmoil with some faculty demanding more oversight of the department’s budgetary operations and an end to institutional subsidies.
White said, however, that there is reason to be optimistic about the state of athletics at Duke.
“The most significant challenge in higher education and certainly in athletics is retaining the appropriate balance between academics and athletics,” he said. “I think at Duke, we have a great history of maintaining that balance.”
Brad Berndt, associate director of athletics who oversees academic affairs, said the most recent statistics released by the National Collegiate Athletic Association Wednesday—showing a 97 percent graduation rate among student athletes at Duke—is an indication of the department’s commitment to providing a top-notch education to participants.
“The student athletes at Duke gush about the place if you sit and visit with them,” said White, who has been meeting with the captains of Duke’s 26 teams since he arrived at the University last year. “They are savvy consumers. They make the Duke decision in terms of intercollegiate athletics because of the world-class academics and to play at the highest level that you can play.”
Craig Henriquez, chair of the Academic Council and professor of biomedical engineering and computer science, commended the athletics department for its improved relationship with the rest of the University.
“In the last 40 years, the divide between academics and athletics has narrowed considerably,” he said.