This is one of the big questions I have been asking over the last few months. What happens if there is no football?
Pac-12 is working on a loan program.
Pac-12 is working on a loan program.
Pac-12 plans massive loan program to bail out athletic departments
- Thread starter ChrisMWilliams
- Start date
That is all dependent on the conference being able to sell those bonds to investors. I guess doing it as a conference makes it a little more feasible as they can sell the TV revenues to collateralize the loan. But man that could get real messy. It also means that these schools will be getting smaller payouts in the future and talk about some dissent. Wow, can you imagine the difference in payouts between the SEC and Pac-XII if a big chunk of TV revenue is siphoned off to pay this bailout. I have no idea what the market would be for these bonds either, that would be best left to a broker like Goldman Sachs.
So last year the PAC12 looked into a partial equity purchase to increase cash now but decided against it. This article says at least part of the reason it didn’t happen was because the potential partners wanted to see a 25-30 year grant of rights.
Thought this quote was interesting:
“They played around with a third party … but decided against any deal,’’ a source said. “They asked everyone to throw in a grant of rights for 25 or 30 years, and USC and UCLA were not going to do it.
Thought this quote was interesting:
“They played around with a third party … but decided against any deal,’’ a source said. “They asked everyone to throw in a grant of rights for 25 or 30 years, and USC and UCLA were not going to do it.
I don't think it is reselling, it is collateralization of the revenue stream from the media contracts. What we don't know is if that revenue is already promised to other debt we have added for the facilities improvements we have added in the last 10 years.
The more I think about it I like this as a good solution, if it ends up being necessary. The Big 12 gets a line of credit, schools borrow on the line to take care of problems for the next two years, then the loan converts to a 10 year term loan, that balloons at the end of the current contracts. Then refinance the balance when the new rights are signed in 2024-2025, or better yet, stretch the GOR now to cover the next 10 years.
The more I think about it I like this as a good solution, if it ends up being necessary. The Big 12 gets a line of credit, schools borrow on the line to take care of problems for the next two years, then the loan converts to a 10 year term loan, that balloons at the end of the current contracts. Then refinance the balance when the new rights are signed in 2024-2025, or better yet, stretch the GOR now to cover the next 10 years.
One football season. What a house of cards with apparently no foresight or disaster plan for any school.
Hard to have a rainy day fund when you’re not supposed to be for profit or have left over funds at the end of the fiscal year.
Non profits are allowed to run a surplus. They are limited in what they can do with that surplus. Many try to maximize their surplus, like for profit companies try to maximize their profit, so they can grow in size to offer their services to more people.
So can a state university run a large surplus and have funds that aren’t earmarked, like a rainy day fund?
As big a surplus as the BOR and the Iowa Legislature will let them have, plus whatever unallocated income is available in the Foundation.
So based on the current Iowa legislature and budget climate, any large surplus is probably not likely to happen.
honest question here.... Do you just hate life in general? like most posts from you are all doom and gloom about everything it seams.... the guys want to play football this year, everyone wants to see them play football.. play ball....
I'd like to see a list of government entities, corporations and businesses that would survive losing an entire year of revenue.
Back when Hilton flooded, I seem to remember someone reporting that ISU is self insured and the athletic department had to file their insurance claim with the university.
So my guess would be yes.
I'm a data guy in IT. Worked at a nonprofit for a little while. Any accountants or financial analysts that work in the nonprofit / public universities space out there that can give a better answer.
Is this why my priority seating donations go to the foundation and not the athletic department? I've always found it strange that revenue always matched expenses even when the number of people attending games and rapidly increasing expenses were not in sync. Even happened in years when ticket prices and donation levels did not increase.
Is there some reserve fund for the athletic department inside the foundation that surplus department revenue gets put into that doesn't show up on the foia requests? I seem to remember Chris saying that Pollard was sitting on a pile of money in the foundation when he was pitching the sports performance center and north endzone improvements.
Last edited:
Which is also a problem. Gone are the days of being conservative and prepared for the unknown. Just whine and ask for a taxpayer bailout, and continue on.
If I were to forgo additional savings to purchase more liquor, would I still be okay?
