2003-04 Nebraska Athletic Department Budget Year in Review; 2004-05 Budget Released

Lincoln -- University of Nebraska Athletic Director Steve Pederson released the 2005 budget on Friday, and provided to reporters a 2004 year-end-budget report with an estimated $67,017 of revenue over expenses. For the second straight fiscal year (July 1 to June 30), Pederson's end-of-year budget reports have been in the black.

The 2003 athletic budget came in at $54,567,332, nearly $20,000 of revenue over expenses. The 2004 books are closed at $55,856,149, with an estimated $67,017 of revenue over expenses. The 2004 budget, prepared a year ago by Pederson, his first as NU’s Athletic Director, was estimated at $53.6 million. Higher than anticipated costs of travel, utilities and payouts to football coaches were the primary reasons for the increases in expenditures. Increased ticket sales, concessions and Big 12 payouts provided nearly $1.6 million dollars in additional revenue. Although Nebraska's year-end expenses in 2004 were $2.1 million higher than the projected budget, the athletic department generated $2.2 million more than expected revenue to more than offset the increased costs.

Recently, Pederson presented the 2005 budget to Chancellor Harvey Perlman and received approval. The 2005 budget of $56,755,864 is approximately $1 million, or just 1.6 percent higher, than its 2004 year-end budget.

The most difficult challenge in fiscal year 2005 will be meeting rising utility and tuition costs with just six home football games. With one less football game in 2004, ticket sales are expected to decrease by a combined $2.5 million. Ticket sales account for the largest share of Nebraska’s athletic revenue (37 percent).

The department's biggest expense is the salary line item which equates to 35 percent of its operating budget, followed by grants in aid (13 percent) and debt service (12 percent). Tuition, fees and housing costs have gone up an average of 12 to 15 percent over the past two years.

The increase of $3.1 million from the estimated 2004 budget to the estimated 2005 budget, comes primarily from three areas; a $1.7 million debt service increase with the start of construction on the North Stadium Improvement Project (the first payment of the $10 million bridge loan is due in November 2004); nearly $1 million increase in grants in aid; and a nearly $1 million increase in salaries. The salary increase represents approximately 1.75 percent raises for each of the past two fiscal years.

Last year the athletic department instituted significant changes in accounting and reporting procedures. All revenue and expenses, even those related to debt service and other expenses paid on behalf of the athletic department, were incorporated into the budget, rather than being listed in the audit only as footnotes or addenda. This all-inclusive accounting method resulted in an addition of nearly $7.5 million to the audited budget. This year’s presentation follows the same procedure.