How much money will UConn save by cutting four sports? It’s complicated.

[huskymedic]

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[JohnFSilver]

Layoffs. That is the only way you get there witbjur a major influx.of revenue.

 

[UConnJim]

Layoffs. That is the only way you get there witbjur a major influx.of revenue.

Real cash savings or accounting cash savings?

Real cash savings can come from layoffs, salary reductions, operating cost reductions,...

Accounting cash savings can come from reduced scholarships, reduced cost of scholarships, reduced payment for use of the XL Center or The Rent (either UConn pays the subsidy or the state so there is no cash savings by reducing the payment for use.),...

It's unfortunate that UConn has advertised the huge athletic budget deficit when poor accounting is one of the biggest issues. Should UConn charge the athletic department the full cost of tuition, room, board, books, fees when over 60% of students don't pay that? Generally, the average UConn student is probably paying $10k less than list price, so why doesn't the athletic department get the same discount? Should all athletes "pay" instate tuition? For football alone, the math works out to somewhere between $1 million and $2.5 million per year. Remember, no cash is changing hands so the $1 million to $2.5 million is just an accounting number!

 

[BlueDogs]

The worst possible solution to any expense problem is pay cuts. It’s the quickest way to drive the best talent out. While heroic, it just makes Benedict more at risk of being poached, and a smart board would have said no thanks. And, yes, the article is right on point, schools bloat sports budgets to hide revenue from legislatures. In our case, it’s bit them on their backside.

 

[CL82]

Accounting cash savings can come from reduced scholarships, reduced cost of scholarships, reduced payment for use of the XL Center or The Rent (either UConn pays the subsidy or the state so there is no cash savings by reducing the payment for use.),...

Not really. That is an actual cash outlay for the athletic department. And a fairly sizable one.

 

[Chin Diesel]

Not really. That is an actual cash outlay for the athletic department. And a fairly sizable one.

It's a real expenditure to the AD but to the state it's an accounting task. For the Rent it's one state agency paying another state agency for the use of a state facility.

 

[CL82]

It's a real expenditure to the AD but to the state it's an accounting task. For the Rent it's one state agency paying another state agency for the use of a state facility.

Mmm the CDRA is a quasi-public entity with income that is not fully derived the state. I'd say that is different. But I like the way you think. By that argument UConn should have lease free use of the Rent and the XL.

 

[JohnFSilver]

Mmm the CDRA is a quasi-public entity with income that is not fully derived the state. I'd say that is different. But I like the way you think. By that argument UConn should have lease free use of the Rent and the XL.

That is not an accounting trick for the state. That is cold hard cash leaving UConn. UConn has agreements with CRDA for rent. It is not an internal transfer

 

[CL82]

That is not an accounting trick for the state. That is cold hard cash leaving UConn. UConn has agreements with CRDA for rent. It is not an internal transfer

Agreed.

 

[UConnJim]

That is not an accounting trick for the state. That is cold hard cash leaving UConn. UConn has agreements with CRDA for rent. It is not an internal transfer

In the corporate world, it's called transfer pricing which is always a point of contention between parties. In many cases, this makes one part of a company look more profitable than it actually is which can lead to bad corporate decision making.

The CRDA may be a "quasi-public" entity, but the State of Connecticut picks up the losses. So, for example, you can show bigger losses for the UConn AD by minimizing losses at the XL Center. Both losses have been picked up by the state so in my mind it is an accounting convention even though there is a cash loss overall. Plus, UConn has an alternative venues to the XL Center, Gampel and the new hockey arena, which might save UConn money by moving games out of the XL Center.