Some details on the Georgia Tech Athletic Association budget, projected to be $73.7 million in the coming fiscal year. The GTAA board passed the budget in late June.
The budget is about a 10 percent increase over the 2014 fiscal year budget of $66.9 million, although a considerable chunk of the increase is a one-time expenditure on improvements to Russ Chandler Stadium that will be paid for out of a draw from the department’s long-term support fund.
The distribution from the ACC increased by 32 percent, from $17.9 million to $23.6 million. The distribution largely comes from ESPN, and the boost is a result of the ACC’s renegotiated contract with the network after the addition of Notre Dame, Pittsburgh and Syracuse, the grant of rights and the upcoming college football playoff. (According to the budget notes, the playoff agreement is worth $3 million in new revenue and the additions to the ACC were worth $2.5 in additional revenue.)
The distribution is expected to increase by roughly $1 million annually, except in years when the Orange Bowl hosts the national championship game. It will increase an additional $1 million in the following year.
Other figures in the budget, prepared by Tech associate athletic director and CFO Frank Hardymon:
1. Ticket sales revenue, while budgeted conservatively, is projected to drop from $11.6 million to $9.8 million. It’s the second-largest source of revenues after the ACC distribution. A projected slight drop in season ticket sales, six home games (as opposed to seven) and the even-year schedule without a home game against Georgia are primary factors.
2. The No. 3 revenue source is sponsorships, which includes Tech’s contract with rights holder IMG ($5.1 million in the coming year) and also with apparel provider Russell Athletic ($900,000). Sponsorship revenue is budgeted at $6.8 million. It’s actually down about $1.7 million from last year, but the department received a one-time $1 million bonus from IMG and then another $800,000 from IMG to pay for a scoreboard project.
If you’re wondering, that’s followed by Alexander-Tharpe Fund donations and scholarship endowments ($5.4 million), student fees ($5.2 million) and the TECH Fund ($5.1 million).
3. The Russ Chandler renovations – a gutting of the facilities underneath the stands, including new locker rooms, offices and training areas – will require a $4.5 million draw off of the long-term support fund, but no long-term debt is anticipated to be carried. The renovations are expected to provide a considerable aid towards recruiting.
4. As has typically been the case, the budget projects to break even. The 2014 fiscal year, which ended in June but still has outstanding revenues and expenses, is expected to break even.
5. The largest expense is, again, salaries, at $23.3 million, an increase of $675,000 from 2014. There was an across-the-board increase of 3.2 percent, as well as contracted raises.
6. The second largest expense is tuition and other school fees, at $10.0 million. In-state tuition will rise 9 percent while out-of-state tuition will increase by the same dollar amount.
A full in-state scholarship is worth about $24,300, while an out-of-state scholarship counts about $43,600. In the entire athletic department, there are roughly 220 full scholarships. (There are more than 220 athletes on scholarship, as scholarships in many sports can be broken up into partials.)
7. The track and swimming teams will continue to have a reduced scholarship budget, essentially the full number of scholarships permitted for their sports but at the in-state rate. Athletic director Mike Bobinski has said in the past that he wants to fully restore the scholarship amount for those teams.
8. Recruiting expenses will increase from $1.306 million to $1.365 million.
9. The $4.5 million to pay for the baseball upgrades will come out of the long-term support fund. Hardymon called the fund a “quasi-endowment” in that it is not a true endowment in that capital can be pulled out of it. The balance of the fund, which also pays down debt on McCamish Pavilion, the Brock indoor football practice building, the Zelnak Basketball Center and the Byers tennis complex, stands at about $38.1 million but will be reduced to about $35.8 million by the end of the fiscal year. However, pledges for the baseball renovations are expected to replenish the fund to $38.2 million by the end of fiscal year 2016.
Hardymon noted that money going towards the baseball project is not being taken from funds allocated for other projects like McCamish.
10. The endowment performed well in the recently ended fiscal year, growing between 10 and 11 percent over the year, creating about $700,000 more than anticipated.
11. The reserve fund, from which money can be taken in case of budget shortfalls, is at about $2.5 million. The goal for the fund is to be at least $5 million. The department had to draw on the reserve fund in the 2013 fiscal year due to a $1.8 million shortfall, largely due to expenses related to the ACC football championship game and the ensuing trip to the Sun Bowl.
The department has hopes that the 2015 football home schedule, which includes Georgia and Florida State, will create enough revenues to significantly restore the reserve fund.