Members of Florida A&M University’s Board of Trustees gathered Tuesday to discuss plans to reduce the financial deficit that FAMUs Athletic Department currently faces.
The new Athletic Director Milton Overton is projected to increase revenue and cut expenses in the upcoming fiscal year. This is the third consecutive year that the athletic program has faced a financial deficit.
FAMU’s Chief Financial Officer, Dale Cassidy, explained that FAMUs current athletic budget will leave the school with a balance of $100,000 at the end of the fiscal year. The Florida Board of Governors Office suggested that the six figure balance is not enough to start a realistic deficit reduction plan.
The school is currently at an $8.9 million deficit and must pay this balance immediately or receive penalties from the state.
“We believe the message from the Board of Governors was to show them more revenue, so that we can be more than a $100,000 in contribution at the end of the year,” said Cassidy.
Overton, who previously served six years as the University of Alabama’s Senior Associate Athletics Director, is working diligently to help project revenues for the incoming year.
According to a report released by FAMU’s Audit and Compliance Committee, the Athletic Department’s current revenues are primarily derived from the student athletic fee, ticket sales, and sales of goods.
This past 2014-2015 season, the FAMU basketball team was winless, and game attendance quickly dwindled game after game. The lack of student participation and attendance can be credited as a factor for the increasing decline in athletic revenues.
Byron Samuels, FAMU’s head basketball coach , asserts that “the only way to have success in all sports is through student participation.”
Currently students pay a $13.97 athletic fee that is included in tuition. The fee allows students to attend sports events for free.
Samuels goes into detail about the efforts that have been previously made to increase student participation at sports events.
“Last year we met with a dozen student groups to tell them about games and support their causes.”
Milton, who was not in attendance at Tuesday’s meeting, starts his new job August 3, and will present a plan just in time for the committee’s August 6 meeting. Cassidy clarified that the revised plan is projected to bring more than the $100,000 balance previously stated in the Athletic Department’s budget.
In 2013, Florida’s Legislature passed a law that required institutions that failed three consecutive audits to go to the Legislature Audit Committee and justify their reasons for not fixing the issue. If the committee is unsatisfied with the response given, the law gives the Board of Governors the authority to take action.
Richard Givens, vice president of Audit and Compliance, went into detail regarding the potential threats the school faces if proper action isn’t taken right away.
“We risk periodic monitoring that could ultimately withhold funding if the issue is not fixed,” said Givens. “What we don’t know is how aggressive the Board of Governors would approach this.”
A financial deficit is not the only problem FAMU’s athletic department is facing. In a recent audit, the National Collegiate Athletic Association (NCAA) showed the school’s failure to comply with corporate regulations. FAMU is being cited for failing to notify students on athletic scholarships if reduction or cancellation occurs. The school is also being cited for not having drug test consent forms on file.