- Jonathan Botros, Senior Associate AD & CFO, Texas Tech University
- Jacque Bruns, Senior Associate AD & CFO, Oregon State University
- Steven Bloom, Director, Government Relations, American Council on Education
- Jonathan Fansmith, Director, Government Relations, American Council on Education
- Ronald Nahass, Director of Financial Consulting, RSM US LLP
- Steve Mermelstein, Director of Management Consulting, RSM US LLP
On Tuesday, April 27th, 2020, LEAD1 Association (“LEAD1”) hosted a webinar catered to all LEAD1 member athletics staff discussing various strategies for athletics departments to survive the financial crisis with respect to the COVID-19 pandemic. The webinar was led by Jonathan Bostros (Senior Associate AD & CFO; Texas Tech University), Jacque Bruns (Senior Associate AD & CFO; Oregon State University), Steven Bloom (Director, Government Relations; American Council on Education), Jonathan Fansmith (Director, Government Relations; American Council on Education), Steve Mermelstein (Director; RSM), and Ron Nahass (Director; RSM).
The American Council on Education (ACE) began the webinar by highlighting some of the federal resources available to help athletics departments during the crisis such as the emergency assistance fund in the CARES Act, which provides direct aid to student-athletes (including food, transportation and housing) for emergency purposes. The ACE panelists made the critical point for athletics departments to consult with legal counsel to determine whether their athletics department may be considered a legally separate entity from the larger university, which would allow the athletics department to potentially apply for certain additional aid under the CARES Act. It is worth mentioning that the panel noted that individual stimulus checks to student-athletes under the CARES would not violate NCAA compliance rules (even if such compensation rendered student-athlete aid above the full cost-of-attendance).
Next, RSM made several suggestions in order to address some of the uncertainty that now exists from a financial standpoint due to the pandemic. Some of these suggestions included forming a crisis “cash flow management team” comprised of various staff across campus to monitor, project and plan cash uses as well as conducting scenario planning analysis such as identifying the most likely scenario with respect to the return of sports and to develop and work that plan.
Finally, Bostros and Bruns, the athletics department Chief Financial Officers (CFO’s) on the call, identified various mitigation strategies for the current and next fiscal year due to the recent revenue reductions in college athletics (e.g., fewer donations, reduced student-fees, distribution reductions and canceled sporting events), including prioritizing “essential” needs for the rest of the year, instituting a hiring freeze, restructuring debt, senior staff “gifting back” to the university (not necessarily reducing salary), foregoing bonuses as a department, taking a differed approach to travel and putting funds in reserves. In addition, the CFO’s discussed various phases to such mitigation strategies such as first identifying revenue already lost in the short-term and then eventually preparing for any further economic downturn based on the possible scenarios in revenue sports (such as fear of public gatherings even if football is played in the fall).