Michigan Athletics Expects $62.9M Deficit For 2021, $1.4M Surplus In 2022
It's no secret that collegiate athletics has taken a monetary hit over the last calendar year due to the coronavirus pandemic that appears to finally be reaching an end, and it has been no different at Michigan, though the Wolverines have weathered the storm.
At a Thursday (June 17) meeting with the U-M Board of Regents, Michigan Director of Athletics Warde Manuel presented the year-end financial projections and the budget for the coming year. In the process, Manuel revealed that the athletic department is expecting a budget deficit of $62.9 million for the current fiscal year and is projecting a surplus of $1.4 million for the coming fiscal year (begins July 1).
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"For the FY '21 operating budget, the athletic department projects an operating deficit of $62.9 million based on operating revenues of $88.8 million and operating expenses of $151.7 million," a press release from the department said. "The operating deficit is a result of significantly reduced spectator admission revenues and preferred seat contributions, as well as reduced Big Ten Conference distributions directly linked to the COVID-19 pandemic.
"Looking ahead to FY '22, the department projects an operating surplus of $1.4 million, based on operating revenues of $180.4 million and projected expenses of $179.0 million."
A significant — and obvious — reason for the projection of a 2022 fiscal year surplus is that fans are expected to return to stadiums and arenas, including The Big House, and teams are anticipating playing full schedules. The department provided further details:
"Spectator admissions and preferred seat contribution revenues are projected to increase by $79.5 million in total due to the return of spectators in attendance," the release said. "This projection as of the June budget deadline could change depending on spectator attendance limits mandated by the Michigan Department of Health and Human Services."
"Big Ten Conference distributions are projected to increase by $9.7 million, primarily due to an increase in television revenues.
"Salaries, wages and benefits are projected to increase by $6 million between FY '21 and FY '22 due to the conclusion of various expense reduction initiatives as well as contractual increases.
"Team and game expenses are projected to increase by $11 million between FY '21 and FY '22 due to the return of normalized team activities, schedules and related travel."
In addition to light-heartedly lauding former Michigan football quarterback Tom Brady for winning his seventh Super Bowl this past February and congratulating former Michigan basketball star Chris Webber for being elected into the Naismith Memorial Hall of Fame as part of the 2021 class, Manuel shared some of the current student-athletes' accomplishments from over the last year.
"Michigan set another school record with 499 student-athletes earning Academic All-Big Ten Conference compared to a record of 405 in the previous year and 372 in the year before that," the statement read. "Another school record was set, with 674 student-athletes earning a grade-point average of 3.0 or better during the academic year. Track and field's Alice Hill (neuroscience) and football's Adam Shibley (communication and media) were U-M's recipients of the Big Ten Medal of Honor.
"Through June 7, 25 student-athletes earned All-America honors during the year. Michigan had 27 student-athletes earn All-Big Ten first team honors with 12 student-athletes winning individual conference titles.
"Despite a competitive season that was significantly altered due to the global pandemic, the Wolverines entered the spring season in second place in the Learfield Directors' Cup standings thanks to top-10 national finishes in women's basketball (9), men's basketball (5), women's gymnastics (national champion), men's gymnastics (3), women's swimming & diving (6) and wrestling (5)."
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