Arizona estimates $60-65 million revenue loss without a football season

Will the Pac-12 find a way to play football early next year, after deciding it couldn’t safely do so this fall?

That process will determine how much of a financial hit the athletic department takes from the postponement of all sports through the remainder of 2020, a deficit that could be as high as $65 million according to Arizona Wildcats athletic director Dave Heeke.

“Without football, we’re estimating a $60 to $65 million impact in revenue loss,” Heeke said Friday on a Zoom press conference. “The financial implications are pretty significant.”

Heeke said Arizona’s projected 2020-21 athletic budget is about $94 million. The most recent U.S. Department of Education numbers, from the 2018-19 academic year, showed football produced $43.3 million in revenue with a large chunk of that coming from media rights, while it had $23.3 million in expenses.

Arizona received more than $32 million from the Pac-12 after the 2018-19 season, its share of TV money, but the conference looks like it will provide an even bigger source of support this time around in the form of a loan. Last week Jon Wilner of the San Jose Mercury News reported the Pac-12 would be offering loans of up to $83 million to each school.

“We would entertain some type of bridge funding if and when it’s available,” Heeke said. “We have to maintain some level of operation.”

Heeke previously projected a $7.5 million shortfall after spring sports were canceled in mid-March, something that was mostly addressed through coaching and staff salary reductions, while some savings were incurred from travel and recruiting.

“We initiated a 10 percent budget cut for all sport programs, a 15 percent cut for all administrative programs,” Heeke said of the spring reductions. “We did a hiring freeze. At that time, we also have a freeze on any new positions to come back that are not related directly to coaching or student athlete development. Now we’re going back to look at larger buckets, areas that we could reduce.”

Much more drastic reductions are needed to make up for the football revenue loss, but one thing Heeke said isn’t being considered is eliminating non-revenue sports.

“That is not on our list at this time, to reduce any sports,” Heeke said. “We’re looking at a number of other mitigation strategies to get through this. We’re part of the university’s furlough program and salary reduction program, so our coaches and our staff are fully engaged in that now. We have done numerous specific sports specific budget cuts and administrative cuts. We were very aggressive, I think, in those things early on. We will have to make additional reductions. Everything’s on the table. That exercise is in full force.”

The uncertainty of whether football will happen prevents Arizona from knowing everything it will do to close the budget gap, Heeke said.

“We need to model so that we can survive—or continue, survive is a way too strong a word—continue to move forward in small chunks,” he said. “And then as we see how things develop, we will pivot and look at additional reductions, or possibly we can … move forward and continue to grow.”

Asked about new revenue streams, Heeke said the department continues to reach out to its boosters but has made sure to indicate to them that any giving would be directed toward student-athlete services. All capital projects have been postponed.

Heeke said the school has not considered offering naming rights to Arizona Stadium or McKale Center.

He acknowledged that a spring football season, though it would likely be shorter than a fall season and fan attendance would be limited or even prohibited, could offset some of the revenue losses.

“That is certainly a benefit to a spring season, but it’s not the driving force,” Heeke said. “We first and foremost want to make sure that we can build a model that is appropriate for our student athletes, but yes that could be offset, and there is support and interest in the spring from our television partners and our marketing partners to continue.”