Cal-Berkeley since '13 has "been overspending by millions of dollars a year," which prompted Chancellor Nicholas Dirks yesterday to announce the "possibility of layoffs and cuts to intercollegiate athletics as part of sweeping changes needed to balance the budget," according to Nanette Asimov of the S.F. CHRONICLE. Cal is "projecting a deficit" of $150M this fiscal year -- about 6% of its operating budget of $2.5B. One area Dirks "singled out for possible reductions" was athletics, but he "ruled out eliminating any teams -- a subject of sensitivity in the past." Asimov notes when the school "tried to cut the men's baseball team" in '11, it "prompted an uproar among alumni who eventually helped raise enough money to rescue it." But college sports "are also operating at a deep deficit." Campus records "show that athletics spent" $9M more than they took in last year, the first time sports reserves "were too depleted to fully cover the gap." In '13-14, "athletics overspent" by $4M, and the year before by $2M. Cal spends $18M a year to "pay for the rebuilt Memorial Stadium, a debt that contributes to the athletic department's financial troubles" (S.F. CHRONICLE, 2/11). In S.F., Connor Letourneau cites a source as saying that Cal's overall athletics deficit is in the $17-20M range. When Cal had "proposed the elimination of baseball and four other sports, the athletic department was receiving" $13M in annual support from the campus. That figure "is down" to $5M. Cal's contracts with Nike (apparel) and IMG (multimedia rights) "will expire next year." Cal is "weighing apparel offers from Nike, Adidas and Under Armour," and the "top suitors for the multimedia rights deal include" IMG, the Pac-12 and Learfield Sports. A source said that the "combined net gain of the two new contracts is expected" to be $6M to $8M annually. Cal "is also expected to earn" more than $1M for its Aug. 27 football game against Hawaii in Sydney. Letourneau adds Cal's athletics deficit "is projected to be back down to seven figures by the next fiscal year" largely because of those developments, (S.F. CHRONICLE, 2/11).
