IPTAY Finances and CUAD Budget FY11

Here, let me show you this stuff that has been sitting on my desk while I was sleeping.

Like last season, we take the time after the big sports are over to look into various things around Clemson's athletic department, such as the budget. Two years ago we gave you the IPTAY budget for 2007-2009 and a comparison of Clemson's AD budget with other opponents (i would open those in new tabs for comparison). Last year we covered the FY10 budget here. Here, we're going to update that information for the FY that ended in June 2011 (July 1 2010-June 30 2011), and includes the 2010 football season only. The current fiscal year is not finished remember.

The Mandate of IPTAY, from Rupert Fike

"to provide annual financial support to the athletic department at Clemson, and to assist in every way possible to regain for Clemson the high athletic standing which rightfully belongs to her."

In accordance with the IPTAY Constitution (Article IV-2), the four priorities of IPTAY are as follows:

  • The payment of the annual cost of athletic scholarships.
  • The payment or reimbursement of the operating expenses of IPTAY.
  • The establishment and maintenance of an adequate reserve fund deemed appropriate by the IPTAY Board of Directors.
  • Any expenditures other than those established under the previous three priorities, shall be limited to either direct or indirect aids to the athletic program of Clemson University and must be approved by the IPTAY Board of Directors.

Below we detail the current membership of IPTAY and the trends over the last 5 years. These figures are concluded on July 1 2011, so they do reflect aftereffects of the 2010 season.

IPTAY MEMBERSHIP 2007-2011
Donor Level 2007 2008 2009 2010 2011
Purple ($140) 4217 3901 3912 3540 3237
Orange ($350) 3915 2725 2636 2564 2477
Champion ($700) 2092 2359 2187 2116 2084
Tiger ($1400) 3406 2604 2059 2030 2009
Howard ($2100) 652 1450 1192 1120 1047
IPTAY ($2800) 1364 2255 2298 2065 2020
Jervey ($4200) - - - 238 245
McFadden ($5600) 113 361 338 289 249
Fike ($7000) 183 286 271 262 252
Heisman ($10000) 201 315 289 290 300
Total 16,143 16,256 15,182 14,514 13920

These figures show a decline in 2011 in every category except Jervey and Heisman level, with the overall IPTAY trend headed downwards over the years. Recall the SEP was initiated in 2008 cycle, and some of the drop in 2009 can be partially attributed to fan discontent to the new seating policies. Membership stats for the lower levels like Tiger Cub/Collegiate Club were not provided.

Other factors affecting membership numbers include the economic downturn, tax changes, gas prices, and the results on the football field. I suspect that small business owners tend to give in the middle membership levels moreso, and economic downturns hit them very hard. This may be why so many stopped giving altogether. The IPTAY level tends to be the largest giving level in terms of cash value.

In the long run though, the SEP is better for the school, as you'll see below.

IPTAY FINANCES FY 2007 FY 2008 FY 2009 FY 2010 FY 2011
Adjusted Balance on July 1 9,056,158 12,129,019 20,042,401 26,591,264 29,909,368
Contributions and Memberships 15,713,657 22,039,696 19,327,875 19,206,541 18,690,451
Investment Income 421,474 537,729 604,581 288,436 315,996
Transfers in 600,000 600,000 600,000 600,000 610,558
Total Additions 16,735,131 23,177,425 20,532,456 20,094,977 19,617,005

Expenditures & Transfers

Scholarships 5,312,116 6,314,579 6,404,132 6,769,782 6,913,985
IPTAY Operational Budget* 2,486,141 2,798,466 2,924,360 2,662,964 2,838,391
Vickery Hall 1,380,915 1,526,203 1,731,742 1,695,241 1,733,885
Tiger Cub/Collegiate Club 23115 54529 42393 43818 34754
IPTAY Special 44974 98067 95365 53340 114940
Priority Four Funding 1,411,299 2,467,073 2,780,469 4,849,098 2,210,991
Segregated Reserve Fund Transfer 2000000 2000000 0 700,000 1,600,000
WEZ Construction 1000000 0 0 0 0
Losses on Investments 3711 5126 5134 2,630 2220
Total Expenditures & Reductions 13,662,271 15,264,043 13,983,595 16,776,873 15,449,166
Net Excess 3,072,860 7,913,382 6,548,861 3,318,104 4,167,839
Balance of Segregated Reserve Funds 3,000,000 3,578,257 4,529,054 4,593,586 7,322,615

IPTAY Total Spending Funds

(Excess+Reserve+July 1 balance)

15,219,018 24.571,455 30,169,519 34,502,954 41,399,822
*-includes
Orange & White 445,421 483,280 492,359 415,379 453,481
WEZ/Capital Fundraising Budget 181,673 161,945 152,797 193,127 483,795

IPTAY Priority Four is primarily a discretionary spending fund determined by IPTAY and the CUAD, in accordance with the 4th priority listed above. It is spent on various things in different years, such as Vickery renovations, stadium equipment, seating renovations, and pressbox renovations. The largest expenses from 2007-2009 are the following: Band expenses, Baseball lighting, CUAD Airplane (likely TDP interviewing candidates) at 1.275 million, WEZ furniture and transition, the new baseball stadium addition (1.7 million), and the South Egress (600K). Basketball marketing was a paltry $84,000 from IPTAY's funding. The FY10 number is larger due to the Chapman addition for baseball ($1.4M).

In FY11, the Priority Four money was spent on several smaller projects like the new entrance to Littlejohn (250K), the turf addition at Death Valley (400K), and the McFadden and Jervey renovations (382K).

So, in my grossly uninformed financial opinion, it looks to me that IPTAY still has money left to spend. We are finishing well in the black even when the football season went down the shitter. We added another $7 million to the spending accounts in FY11, for a total of $41 million just sitting there. The reserve fund is separate and basically a "rainy day" fund invested in other things outside of the S.C. State Treasury. $6.9 M is listed as actual scholarship money, with a smaller discretionary budget of $2.2M last year.

IPTAY has listened to some of our griping and pledged some of this cash towards directing the Training Table and IPF to get done now. I do wonder just what rainy day they expect to come when they'll still be sitting on all that money even after these two projects are finished. Only the Oculus would make a dent in that $41M. Frankly they could afford to start half of the big projects in the $50M initiative and not require specific donations until later.

I do wonder though why we don't see specific mass mailings and fundraising efforts to that initiative yet. I would donate to those before I ever donate to IPTAY again.

Clemson's FY11 Athletic Department budget is a separate entity from the IPTAY budget, and neither the President nor the Athletic Director have discretion over the IPTAY funds. Note also in the below table that at Clemson, and in the eyes of the NCAA, baseball is a non-profit/revenue sport. Its a money pit, as are all other sports aside from football and basketball when you look at the budgets. Thus, its not a separate category in the AUP reports. However, baseball always loses CU at least 600K each year, sometimes approaching $1 Million in loss. Even with our Top 10 attendance, we aren't paying our way with baseball yet.

And now we show the CUAD NCAA AUP budget for FY11.

CUAD Revenues FY11
Revenue Item Football Basketball Other Sports Non-Specific IPTAY Vickery Total FY10 Total FY11
Ticket Sales 18,784,904 1,476,872 475,066 - - - 19,877,413 20,736,842
Student Fees 1,457,154 137,259 - - - - 1,585,556 1,594,413
Away Game/Guarantees 1,000,000 - 7500 - - - 570,754 1,007,500
Contributions 2,326,623 676,143 3,216,657 3,328,316 2,872,674 1,751,321 14,998,354 14,171,734
Direct Institutional Support 948,705 363,668 2,163,063 36,174 - - 3,233,520 3,511,610
NCAA/ACC Distributions 6,266,848 5,100,278 109,683 86,921 - - 10,963,428 11,563,730
Broadcast Rights 555,000 175,000 - 1,370,000 920,000 2,100,000
Sales/Concessions 1,421,747 227,701 99,844 37,532 1,796,334 1,786,824
Royalties/Advertisements 388,000 209,000 172,500 3,509,655 3,213,036 4,279,155
Endowment/Investment - - - 198,094 201,166 198,094
Other 38,217 - 78,670 108,181 213,438 225,068
Subtotal Revenue 33,187,198 8,365,921 6,322,983 8,674,873 2,872,674 1,751,321 57,562,999 61,174,970

Clemson football generated $3M more dollars of revenue as the bread winner in the 2010 season than in 2009 when we went to the ACCCG. Ticket sales raised $1M of that increase even for a 6-7 season, and the ACC distributions actually decreased by 200K. Internet broadcasting rights brought in a half million that they had not before, specifically for football. Usually the deals have been non-program specific. CU usually gets killed in that category; schools like Georgia bring in huge multimillion dollar deals. Royalties also doubled compared to 2009 season.

Clemson basketball generated almost $1M more in the 10-11 season compared to 09-10, mostly due to contributions from the ACC and NCAA distribution.

A full explanation of the terms is available in this document: NCAA procedures. I think most are self-explanatory. "Non program specific" entails funding that doesn't necessarily fall under one particular sport; its a general term. If your donation mandated "soccer and baseball", for example, it would go here.

Not shown here as a line-item is revenue from various camps/clinics, though it could be lumped in elsewhere. Our study of AUP figures show that some schools do seem to lump them in with something else. I believe it depends on the specific amount the school makes or the type of clinic, but I'm not sure.

Next the Expense report:

CUAD Expenses FY11
Expenditure Football Basketball Other Sports Non Specific IPTAY Vickery Hall Total FY10 Total FY11
Student Aid 3,168,065 1,010,124 5,320,041 917,595 - 9770 10,003,301 10,425,595
Guarantees 1,000,000 450,379 34,036 65,278 - - 2,283,672 1,549,693
Coach Salaries 5,386,894 2,720,218 3,579,804 164,267 10,942,610 11,851,183
Support Staff/Admin salary 1,532,393 387,994 103,096 6,738,109 1,139,587 1,522,158 10,936,581 11,423,337
Recruiting 490,305 271,970 307,291 - 812,932 1,069,566
Travel 1,443,737 818,810 1,290,067 220,341 96,239 15,609 3,771,415 3,884,803
Equipment/Supplies 572,574 165,811 583,162 193,948 4,684 2,879 1,399,306 1,523,058
Game Expenses 1,983,300 474,358 315,390 - - - 2,336,900 2,773,048
Fund Raising/Marketing - - - 389,848 1,638,198 - 2,056,116 2,028,046
Facilities/Maintenance 156,629 42,208 49,405 1,834,491 - 21,933 3,085,116 2,104,666
Indirect Facilities/Admin Supp - - - 2,590,776 - - 2,438,988 2,590,776
Other 814,497 356,341 493,691 6,003,565 - 171,307 5,809,205 7,839,401
Total Operational Expense 16,548,394 6,698,213 12,075,983 19,118,218 2,878,708 1,743,656 55,877,012 59,063,172

At first, if you were just looking at '10 vs '11, you'd say we spent a ton more money, but we're still spending a little less than we did in FY 2009. The trend is upwards over the last 5 years of data we have, of course. Most of the increases came in recruiting budgets and coaching salaries compared to the previous year this time around, but FY 2009 was a big spending and revenue year. Overall, Clemson spent about $2M more for all the other sports compared to the previous year and $2M more on general non-specific expenses.

In addition to the expenses above, there are nonmandatory/mandatory transfers each year to various things before you get to the real figure for outlays.

Mandatory Transfers - - - - 1,000,000 0
Nonmandatory Transfers
-Student Services 25,000 - - 6,000 41,000 31,000
-Construction Projects - - - 989,183 1,675,576 989,183
-Band Support 260,297 187,930 260,297
-IPTAY 600,000 (2,016,000) 600,000
-Institutional Research 15,000 15,000 15,000
TOTAL EXCESS +16,613,804 +1,667,708 (5,753,000) (12,313,825) (6,034) (7,665) +$782,481 +216,318

The total excess is the difference between all revenues, expenses and transferred cash, so CUAD made $216K in FY11, a loss of roughly 500K over FY10. Numbers in the final line in parentheses are losses. The IPTAY figure of $2 million in FY10 is a revenue (transferred In). Clemson's total operating balance is just under $ 10 million, this takes into account the gain of 782K to the total balance at the end of FY09 of $ 8.6 million and another 215K this year.

So you see Football generated $33 million and spent roughly half of it. Basketball generated 1.6 million bucks and the money pits are in the other sports and the non-specific athletic spending, and most of that was spent on facilities maintenance, AD support staff, and administrative salaries for people not tied directly to one sport.

Now to the issue of how much funding CU takes away that we're interested in. Clemson taxes the AD at a rate of 6% based on the AD earned revenue figure from two years prior. Earned revenue is revenue such as ticket sales, corporate sponsorships, etc., but it does not apply to contributions. The institution uses two years' prior so the AD can budget an amount with a level of certainty. So they look at the FY budget from two years beforehand (FY09 here), take the total revenue figure minus our contributions and levy a 6% tax on the department budget so they know ahead of time how much to plan to donate back. This came out to be just under $3 Million. The $2,590,000 above for Indirect support is the majority of it.

For anyone wondering, with the new TV deal coming online for the 2011 football season, it will take 2 years for Barker to raise his charging rates and get more than $2.5-3 million from the AD (assuming this process remains in place). Clemson should get around $6 million from the new TV deal starting in the FY12 budget.

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