FAMU’s update on its athletic deficit to the Florida Board of Governors (BOG) audit committee Wednesday was met with a different tone than its previous two presentations. Because the athletic deficit is a continuing audit finding the University must regularly report to the BOG on how it plans to cure it.
In December, Trustees approved a plan to raise the athletic fee student fee students pay by $3 per credit hour. They also reduced the technology fee students pay by the same amount to keep overall student fees flat.
The fee shift provided the athletic department with an additional $402,000 it could use immediately. The athletic administrators also reduced salary expenses by $442,741 late last year and used $500,000 in Title IX funds for scholarship buy-downs, and used the interest off some auxiliary accounts. The Title IX funds are recurring so that money will be available again next year.
These quick fixes were made to cure a projected $2.4 million shortfall in the current years' (2019-20) athletic budget.
A $188,485 increase in gate receipts at FAMU football games this season also helped with the bottomline to end the current year which ends on June 30, 2020 in the black.
FAMU will continue with its 12-year plan to pay off the overall athletic deficit of $8 million, which had accumulated over the past 15 +/- years. And is on track to make its scheduled payment this year. So far, the University has paid down $1.1 million of the deficit.
BOG member Kent Stermon praised the University’s presentation saying “he was impressed with how the University has approached the issue. The deficit has been there for many years and they have dealt with the problem head-on.”
Stermon, estimated that at the current rate it would take FAMU 25-30 years to pay off the deficit --- absent an “angel donor”.
BOG member Norm Tripp, a former FAU Trustee, wondered why the BOG doesn’t allow the University to write off the debt, if it continues to operate within its budget for a few 2-3 consecutive years.
BOG member Alan Levin, responded to Tripp’s suggestion of allowing the University to write-off the debt by saying “we have to be very careful that we don’t set a precedent here, because what happened here was not alright.”