February 2, 1995
from the Tulane University Hullabaloo
According to the Tulane University Senate Budget Review Committee, Tulane's athletic department may prematurely use up funds donated to keep the department operating in the black.
A privately donated stabilization fund in the amount of $9 million was to be distributed over a five year period beginning in 1992 to stabilize the athletic department's finances.
A statement issued by the Budget Review Committee maintains that the committee is dismayed that the athletic department's stabilization fund will not last the projected five years.
Ira Nemeth, a student representative to the University Senate, said, "The committee believes excess expenditures are a significant component of the shortfall."
The committee contends that the athletic department's handling of its finances borders on malfeasance and does not adhere to strict budgetary guidelines as spelled out by University policy.
The committee also expressed concern that there appeared to be different budgetary standards imposed on athletics in comparison to budgetary standards imposed on other units of the University.
A 1992 school-wide restructuring report suggested that the athletic department's allowable cash deficit be reduced by $200,000 annually over the ensuing five years. However, the Budget Review Committee contends that current expenditures will cause a greater budget deficit than allowed.
They maintain the stabilization fund will not last, running out either by the end of 1995 or early 1996.
In sharp contrast to the Budget Review Committee's assessment, Associate Athletic Director for External Affairs, Ian McCaw, said the stabilization fund was not near depletion. He did concede, however, that there had been a heavy front-end use of funds for this fiscal year relative to normal spending practices over the course of an annum.
"What we don't want," said McCaw, "is a year-end deficit. And that's not going to happen because there are several million dollars left in the fund."
Past statements released by the athletic department have maintained that the stabilization fund would allow for budget relief, enhance recruitment in all sports and add two women's sports teams as of 1995 in keeping with gender-equity policy.
Also, the athletic department intends to secure a full complement of NCAA scholarships in all varsity sports with the ultimate goal of higher ticket sales and increased revenue.
McCaw stated, "We're extremely optimistic about some of our income opportunities in the future. For example, the new football conference we just formed, which begins in 1996, signed a five-year $420 million television contract this month wherein we're going to generate a significant amount of income from television."
McCaw added, "The stabilization fund was established to shore up our finances while we attempted to get into a conference in order to generate higher revenue. Thus far, our goals have been met."