IPTAY Finances and CUAD Budget FY11

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.