RSS

A CPA Looks at the UW Athletic Department

I attended last Saturday’s Republican caucus to support Rick Santorum.  As a follower of Jefferson, I believe wer need two real parties.  It time the Republican Party run an hoest candidate.   I will write more about this later …now I want to discuss the Huskies.

At that Saturday’s Caucus, I met “Tom,” a CPA who wanted to discuss the Huskies.  Tom did not believe me when I said that the UW’s pro sports teams not only do not earn money for the UW, they cost the tax payers money.

Sad to say, I was trying to tell this Republican that there is no free lunch.

Tom and I had a great discussion.  Since he is a CPA, Tom decided to do a bit of investigation himself and wrote to the UW Athletic Department asking for clarification.  Here is the response Tom got from the UW along with my feedback. 

Dear Tom.

I really enjoyed meeting you and am glad you took the time to contact the UW. 

As I said, I support the Huskies as an entertainment service the UW supports for the state.  What I am object to is the false impression that this service is free  The email you received seems, at least to me, to be evasive. Here is a challenge.  You are a CPA. The Athletic Department is a public agency.  Ask them for a detailed budget, good luck!

Here are some specifics that you, as a CPA , might wonder about:

First, you might note that there is NO mention here of “profit” or of any net moneys going to the UW itself.  If you were acting as an accountant for a business unit of REI or Swedish Hospital (like the UW, “non profit” entities), I assume you would find this suspect? It might be of great interest to compare the costs of support for ALL college level sports at other elite American universities, including the private elite schools (MIT, Harvard, Stanford) that we compete with in academic standards.

On Mon, Mar 5, 2012 at 9:28 AM, Tom  wrote:

Hi steve, I did a quick follow up on the athletic department finances. I may have misunderstood your position, but here is the information from their finance director:

Hi Tom,

Thank you for your inquiry.  You are correct in that the football and men’s basketball programs generate the revenue needed to support  the other 19 sports.  Any surplus is used to maintain and upgrade the athletic facilities for all of our sports. 

Second, Mr. King gives the impression that the UW AD supports “all” UW sports. What “other sports” does Mr. King include?  As a parent of UW students I was struck at the very meager offerings outside of the professional sports program. The UW has very limited sports offerings outside of its pro and semipro efforts.  As one example, it has NO swimming team. One way to look at this is how many students are served? ALL other UW programs are evaluated. in part, for our efforts to educate students.  How many UW students are enrolled in programs supported by the AD?

The problem here may be the Athletic Department’s narrow focus on “sports” as the professional extramural efforts and those additional extramural efforts required by Federal law (e.g. women’s sports).

I would like to know how much support the AD gives to the intramural programs .. esp exclusive of its own uses of those facilities as well as whether any of its income goes to programs that are closely related to the AD such as sports education, physical education, sports medicine,   or even sports related programs in the B school?

The Athletic Department does pay institutional overhead to the University for the central services that are received.  The amount paid in the 2010-2011 was just over $2 million. 

This is a very suspect statement.  No other Department has its overhead determined by “the central services that are received.” Instead we pay a portion of such shared amenities as the President’s home, the functions of his and the Provost’s offices, the library, the IT structure of the campus, compliance legal services (presumably including compliance on the part of the AD), a campus wide police service, etc. etc. Based on the UW contracts to support on campus federal grants, this might range from 25% to 75% of the AD income.  I would love to see you evaluate this using real numbers!

In addtion, in the same Fiscal Year, the Athletic Department paid just over $1.1 million in utilities. 

This is normal.  When you pay a bill to UW Medicine, part of your bill goes for electricity and water. ALL the campus pays for the utilities its faculties use. However, the rest of us ALSO pay for the utilities costs of shared facilities. What share of the costs of keeping up the UW’s grounds is paid by the AD?

Taxpayers and the rest of the University do not financially support these programs.  I hope that this information is helpful.  Thank you for your support.

This is an evasion of the truth.  Taxpayers support ALL UW activities in many ways, including the tax free use of valuable propertyh.  Imagine how successful the Huskies would be if they had to pay real estate taxes!  Here is one example .. we are remodeling the stadium for $250,000,000.  I assume, therefore, that this net value of the stadium (including its land) is much more than that. What is the real estate tax due on $350.000.000?  Wouldn’t that be $3.150,000? Another issue, for another time, is the very real issue of racism implicit in the Huskies’ recruiting policies.  While Harvard and Stanford (the latter also in the PAC 12) demonstrate that there are wonderful student athletes that can be recruited to top research schools, the UW AD refuses to use academic ability as part of its decisions. The result is a sad taint on UW African American students and especially on those black students  wearing a varsity letter.

Paul King

Senior Associate Athletic Director, Business & Finance

Again, I support the Huskies, I do not support the misrepresentation by the AD.  Tom … comments welcome!

 

 

Tags: , , , , , , , , , , , , , , , , , ,
Posted 05 Mar 2012 by theaveeditor in Misc., UW

←
→

Comments are closed.