By Jeff Barker
The Baltimore Sun
5:42 PM EDT, August 13, 2013
The University of Maryland is not yet financially able to restore any of the seven teams eliminated last year and must instead use limited athletic department revenues to fund other priorities — including some on the academic side, President Wallace Loh said.
With Maryland facing a $21 million operating deficit and a continuing legal skirmish with the Atlantic Coast Conference, Loh said in an interview that the school must focus on such concerns as paying off debt, improving student financial aid packages and increasing spending on existing athletes — a category in which it would rank among the lowest in the Big Ten.
Loh said Maryland’s athletic department remains in a financial hole for now — partly because the ACC began withholding millions of dollars in shared conference revenues after the university announced last November that it was joining the Big Ten in July 2014.
“They continue withholding revenues that are rightfully ours,” Loh said.
Loh said Maryland’s operating deficit would have been about $5 million or $6 million, but that it has increased to $21 million because of the ACC action.
“With a $21 million deficit, there is not a heck of a lot I can do,” Loh said.
Asked about the commission’s findings, athletic director Kevin Anderson said Tuesday that his department’s goals have not changed.
“Will there be some short-term sacrifices? Yes. The expectations don’t change. All my coaches know we’re going to compete at the highest level for Big Ten championships and national championships,” Anderson said.
The ACC has indicated in court that it is withholding the money because it has realistic concerns that Maryland won't pay the $52 million exit fee. The conference has said the withholdings amount to an “offset” against the exit fee.
Loh was interviewed this week following the release of a report by a university commission created last year to study, among other things, whether any of the eliminated teams could be reinstated. Maryland’s shared conference revenues are expected to significantly increase once it becomes part of the Big Ten.
But the 22-member commission, led in part by regent and top donor Barry Gossett, said in the report that it could recommend only that men’s outdoor track and field be fully restored.
Although that team was originally targeted for elimination, it was never disbanded. Rather, it was able to continue with the aid of a private fundraising effort.
Under the commission’s recommendation — which Loh endorsed — men’s outdoor track and field will be fully funded and its scholarships will increase from six to 12.6 next year.
Andrew Valmon, the team’s coach, said in a written statement that he was grateful the team stayed afloat.
"Over the last two years, there were countless individuals who made significant contributions to our 'Save Our Sports' campaign and we will be forever grateful for their commitment to our student-athletes and our program," the statement said.
Loh had said late last year that the commission would review the eliminated teams “and recommend which ones should be reinstated, and on what timeline.”
He didn’t know then that the ACC money would not be available. Maryland has challenged the exit fee in court and has argued that the withholdings are illegal. The litigation is continuing.
The dropped sports were men's tennis, men's indoor track and field and cross country, men's swimming and diving, women's swimming and diving, women's water polo, and women's acrobatics and tumbling.
Maryland has projected that revenues will begin to exceed expenses in about five years. Loh said the school will revisit restoring teams when it becomes economically feasible.
“Restoring some teams down the road is definitely a possibility. There are a number of factors that have to be balanced,” Loh said.
In the meantime, Anderson said that new Big Ten revenues will provide Maryland athletes with additional money for academic support, training and nutrition.
Loh also said Maryland plans to use some of the Big Ten revenue on the academic side rather than returning it all to athletics.
“I want to use some of the money to support student financial aid for students as a whole,” Loh said. “We will be one of the very few universities in the country where you use athletic money to support the academic side of the house.”
Most athletic departments lack the resources to provide significant support, if any, to academic programs. Among the exceptions are Iowa and Alabama.
Alabama, the defending BCS national champion in football, has provided money for academic scholarships.
Loh also said Maryland will use $500,000 per year in existing athletic department money to expand mental health counseling for all students.
Loh said he was influenced by a February incident in which a university student shot two other students, one fatally, before killing himself. At a vigil following the shooting, Loh had become emotional. “Each of us is asking, what do we need to change to prevent or mitigate the chances of something like this happening?” he had said.
Loh said this week that mental health “is the number one issue among students across this whole country. Everybody is scrambling to increase mental health resources. So here’s an opportunity.”
In addition to its operating debt, Maryland has about $80 million in capital debt from building Comcast Center and upgrading Byrd Stadium.
The school hopes to also build an indoor practice facility, primarily for football. The commission recommended that Big Ten money not be used for such a facility, and Loh agreed.
Rather, Loh said the school would embark on a capital campaign to raise the $50 million to $80 million needed to build the facility.
Copyright © 2013, The Baltimore Sun