feCal cant finance their stadium
Posted: Thu Apr 19, 2012 6:32 pm
As state legislators shrink its appropriations, it's hard enough for the University of California-Berkeley to maintain the nation's highest academic ranking among public colleges.
But there now looms a financial threat from another, somewhat unlikely quarter: the university's football program.
Until now, the years-old effort to renovate the school's football stadium, which sits on an earthquake fault line, never raised many alarms. Although its $321 million price tag would make it one of the most expensive renovations in college sports history, the university said the project would be funded privately, largely through long-term seat sales and naming rights.
But three years into the fund-raising effort, a projected $270 million from the sale of seats has failed to materialize. At the end of December, the school had collected only $31 million in the first three years of the sale. Now it has become clear that the university will have to borrow the vast majority of the money.
In recent interviews, university officials acknowledge that if revenue projections fall short and won't cover the bond payments, the shortfall "would have to come from campus."
The idea that money for the football stadium could come from campus funds, which include student fees, is an admission likely to stir outrage at a school that's already facing possible double-digit tuition increases. "It is disconcerting that the university may be gambling with student fees and other academic funds to cover a massive financial commitment for a football stadium," said Cal computer-science professor Brian Barsky.
John Wilton, the school's vice chancellor for administration and finance, said the stadium project is "a fairly complex project and financing model that has many moving parts" that should be judged over the long term. He said that under most projections, the school won't have to dip into campus funds for many years.
"We're not asleep at the wheel here," said Sandy Barbour, Cal's athletic director.
To outsiders, what's surprising is that this expansive project is happening at Cal, a school that hasn't had a powerhouse football program in years. Cal hasn't played in the Rose Bowl since 1959 and doesn't routinely sell out its stadium. (The school is reducing capacity in the renovation to roughly 63,000 from about 72,000.)
Unlike some athletic powerhouses, Cal's athletic department isn't self sufficient. From 2003 to 2011 it stayed solvent only by receiving a total of $88.4 million in campus funds, according to research by Barsky. Wilton, the vice chancellor, said the figure doesn't account for donations to the university that might be inspired by the school's athletic programs.
The stadium situation comes at a time of financial anxiety on campus. After the state legislature last year slashed $650 million from the University of California system's previously $3-billion budget, tuition at UC schools rose 17% for in-state students and 5% for nonresident ones, prompting student protests and sit-ins on the Berkeley campus. With California already leading the nation in tuition increases, the UC system has said that annual tuition spikes could range from 8% to 16% over the next four years....
http://online.wsj.com/article/SB1000142 ... 41598.html
They tried canceling baseball last year, how long before they try canceling football
But there now looms a financial threat from another, somewhat unlikely quarter: the university's football program.
Until now, the years-old effort to renovate the school's football stadium, which sits on an earthquake fault line, never raised many alarms. Although its $321 million price tag would make it one of the most expensive renovations in college sports history, the university said the project would be funded privately, largely through long-term seat sales and naming rights.
But three years into the fund-raising effort, a projected $270 million from the sale of seats has failed to materialize. At the end of December, the school had collected only $31 million in the first three years of the sale. Now it has become clear that the university will have to borrow the vast majority of the money.
In recent interviews, university officials acknowledge that if revenue projections fall short and won't cover the bond payments, the shortfall "would have to come from campus."
The idea that money for the football stadium could come from campus funds, which include student fees, is an admission likely to stir outrage at a school that's already facing possible double-digit tuition increases. "It is disconcerting that the university may be gambling with student fees and other academic funds to cover a massive financial commitment for a football stadium," said Cal computer-science professor Brian Barsky.
John Wilton, the school's vice chancellor for administration and finance, said the stadium project is "a fairly complex project and financing model that has many moving parts" that should be judged over the long term. He said that under most projections, the school won't have to dip into campus funds for many years.
"We're not asleep at the wheel here," said Sandy Barbour, Cal's athletic director.
To outsiders, what's surprising is that this expansive project is happening at Cal, a school that hasn't had a powerhouse football program in years. Cal hasn't played in the Rose Bowl since 1959 and doesn't routinely sell out its stadium. (The school is reducing capacity in the renovation to roughly 63,000 from about 72,000.)
Unlike some athletic powerhouses, Cal's athletic department isn't self sufficient. From 2003 to 2011 it stayed solvent only by receiving a total of $88.4 million in campus funds, according to research by Barsky. Wilton, the vice chancellor, said the figure doesn't account for donations to the university that might be inspired by the school's athletic programs.
The stadium situation comes at a time of financial anxiety on campus. After the state legislature last year slashed $650 million from the University of California system's previously $3-billion budget, tuition at UC schools rose 17% for in-state students and 5% for nonresident ones, prompting student protests and sit-ins on the Berkeley campus. With California already leading the nation in tuition increases, the UC system has said that annual tuition spikes could range from 8% to 16% over the next four years....
http://online.wsj.com/article/SB1000142 ... 41598.html
They tried canceling baseball last year, how long before they try canceling football
