Florida A&M University’s Athletic Department delivered a balanced budget to the Board of Governors on Sept. 16, earning praise from the body that oversees the state’s 12 public universities.
AT that meeting held at the University of South Florida, FAMU Board of Trustees Chair Kelvin Lawson talked to the BOG about the athletic department’s budget and other year-to-date projections regarding revenue and operating expenses.
A balanced budget is when revenue is equal to total expenses, therefore the budget is neither below nor above the revenue amount. The department’s total budget for operating expenses is $6.5 million, and its year-to-date projected expenses is $6.1 million.
Lawson told The Famuan what a balanced budget means for FAMU athletics and how important it is to maintain that budget.
“It’s very important for athletics to have a balanced budget given the situation that we have with the Board of Governors and that situation being under a 12-year repayment plan to our auxiliaries,” Lawson said. “It’s important for us to have a balanced budget for our own FAMU self, as reasons to demonstrate that we can run a department within our own means and not overspend or under project our spending.”
FAMU’s athletic department and its budget have taken a huge hit when its athletic conference, the MEAC, canceled fall sports — including football, the primary revenue sport for FAMU and almost all other schools — due to the COVID-19 pandemic.
After eliminating football, the overall budget was reduced by 40 percent.
Even with the addition of spring football, it will do little to help the budget, according to Lawson.
“When you have a couple of guaranteed games against a major school like UCF and then you have the Florida Classic in November, it’s tough to replace games that produce that kind of revenue,” Lawson said.
Lawson also discussed how the department was prepared to deliver a balanced budget this year, regardless of the effects of COVID-19 and past challenges it has had to overcome. FAMU athletics has accrued an overall deficit of more than $8 million dating back more than a dozen years.
“We budgeted this year for a worst-case scenario. We think we’ve taken the biggest hit already and prepared ourselves for the worst. The worst for us was budgeting with no football, so we created a budget that had no football. So, when our conference pulled the plug on football, we were already ready to pivot to that worst-case scenario budget,” Lawson, who also chairs the BOT’s Special Committee on Athletics, said.
“Some of the challenges that the department has had historically, the department has not generated enough revenue to offset the expenses that it’s had.” Lawson added. “It also suffered from poor budgeting. People didn’t properly budget to what the true expenses were and weren’t really taking aggressive steps to better manage the existing budget and control expenses.”
Lawson feels that the athletic department is now headed into the right direction and will continue to provide a properly a balanced budget.
“We’re just in a much better place where we’re doing a much better job projecting our true revenue and expenses, and doing a better job of holding ourselves accountable to only spend what we budgeted, and just because something looks good or feels good, we’re not spending or buying it in that particular year if it’s not in the budget.” Lawson said.
FAMU Vice President and Athletic Director, Kortne Gosha was ecstatic to deliver a balanced budget for the second year in a row.
“We’re excited, this is the second year in a row we have delivered a balance budget. We did have some turbulence prior to my arrival, and we have been able to cure that,” said Gosha, who was hired in November and started at FAMU the first week in December 2019.“We’re being very diligent in our financial discipline, but we will make sure that we won’t compromise the student-athlete experience here at FAMU, that’s our No. 1priority.”
Gosha noted that the department has initiated reductions in pay for all athletic department employees, including himself, and that a hiring freeze is in place.