The COVID-19 pandemic has brought the sports world to a shocking and abrupt halt, as all major American sports leagues have either suspended or postponed play, and March Madness has been canceled outright. On Tuesday, the Southeastern Conference ended the seasons for all its spring teams, effectively ending every conference sports activity until August.
Missouri Athletics, which operated at a $1.79 million deficit in the 2019 fiscal year, was already expecting a big hit to its budget this fiscal year because of sanctions levied by the NCAA in late January 2019. Now, these recent cancellations mean the athletic department could lose even more. It’s still too early to say exactly how much might be lost, but indications are that it will be a sizable amount.
The biggest hit likely will come from the loss of shared revenue from the NCAA Men’s Basketball Tournament. March Madness is responsible for around 80% of the annual revenue the NCAA generates, and most of that money is distributed to member schools, Missouri included. With the 2020 tournament no longer happening, that money essentially is gone, with no apparent way to get it back. The NCAA has insurance related to the tournament, but athletic directors are not expecting the organization to be able to cover all the losses, according to a USA Today report.
The amount of money Missouri stands to lose from the loss of tournament revenue and other sports is still up in the air.
“I don’t think (we’ll) make up any of these losses,” Missouri Athletics chief financial officer Tim Hickman said. “The games are gone. (They) won’t host the 2020 NCAA Tournament. There won’t be the remaining part of the 2020 (college) baseball season. Those things won’t be made up. They’ll just move past it and deal with it.”
Most of the athletic department’s direct revenue — i.e. money earned from the school’s sports — is already in place. Specific to teams, the athletic department gets the bulk of its money from football, with men’s basketball coming in a distant second. Much of that money comes from media rights for those sports, which are mostly unaffected by the cancellations. In 2019, Missouri received $38.2 million from media rights. But the athletic department has operated in the red now for three years in a row, and the loss of more revenue this year will certainly not help change that.
“Any time you’re losing revenue, that’s a problem ... ,” Hickman said.
The finances relating to 2020 spring sports still hang in the balance. But in 2019, the spring teams at Missouri racked up more expenses than they gained in revenue, and that likely would have been the case in 2020.
In 2019, Missouri’s spring sports, excluding track and field (which is not strictly a spring sport), lost more than $6 million. No individual team brought in more revenue than its expenditures, either. Those numbers don’t reflect what the net revenue would have been in 2020, but they serve as a benchmark.
The spring teams that contributed the most revenue a year ago were baseball and softball, which together generated nearly $500,000. Those teams also spent more than every other spring team, with baseball needing $696,000 and softball needing just over $566,000 in 2019.
The majority of the spring team’s expenses come from travel. But even though those teams won’t be making any more trips in 2020, the athletic department might not be able to get out of some of its future travel-expense commitments, which include hotel contracts, buses and airfare. Hickman said the athletic department has a travel agent that is working on trying to save those expenses.
Coaches’ salaries and scholarships will still be paid out as well, meaning there is little respite from the revenue losses.
Beyond any money lost from the cancellation of the NCAA Men’s Basketball Tournament, other, smaller revenue streams for MU are in jeopardy because of the novel coronavirus pandemic. The school’s tennis center, which offers memberships, is closed and that will possibly lead to the necessity of issuing refunds.
The athletic department also operates a number of summer camps that as of now are still scheduled to be held, but could potentially be canceled due to the pandemic. In 2019, the athletic department earned nearly $1.2 million from sports camps revenues, which cost $615,000 to operate.
The cancellation of sports is unprecedented, and there is no telling how long the pandemic will continue to affect the sports world. For now, it’s just wait-and-see.
“It’ll depend on how long these impacts are in place for,” Hickman said.