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Every penny counts! Budgeting Basics for High School and College Athletic Departments

With the new year, athletic administrators everywhere internally ponder that nasty B-word: Budget. Schools in general and athletic departments specifically are in a tough spot. Price of goods and services rarely, if ever, go down and yet demands of administrators, parents and coaches continually rise.

Asked to do more with less compared to institutions with budgets that could be two to three or more times their own, athletic administrators may be harshly judged when — for whatever reason — they cannot produce at the highest levels. And attempting to explain the idea of the haves and the have-nots when it comes to the budgetary constraints of the athletic world is not acceptable.

Athletic departments are constantly asked to stretch things just that much further. That may mean using uniforms one more year, purchasing inferior equipment to outfit our teams or going without training tools. Perhaps the biggest issue to overcome is trying to hire elite-level, culture-changing coaches with limited payroll resources to entice them.

At the collegiate level, according to the NCAA, fewer than 30 FBS athletic departments generate excess revenue, meaning more than 100 have to rely on the school to pick up their budgetary shortfall. Colleges and universities, generally speaking, subsidize the athletic budget, either in whole or in part, just as high schools nationwide must do.

Departments and schools are under scrutiny for how much is spent on athletics without a direct return on investment. One can argue athletics exists for the betterment of the institution, to advance the university brand within the community, to enhance student recruitment and the student experience, among other reasons, but the bottom line is that in the vast majority of institutions, the athletics department operates at a net-negative. Athletic administrators, then, are put in a position to defend their departments, justify spending and work to build successful programs.

Of course, success is defined differently depending on the institution and department. If upper-level administrators or members of the coaching staff have not come up with a definition of success, they should work on that. It’s incredibly important and frames everything from a top-down vision perspective, so one can then work on alignment and execution through things such as budget construction and proper utilization. To paraphrase Alice in Wonderland author Lewis Carroll, if you do not know where you are going, how will you know if you get there?

There are no easy answers or one-size fits all solution, but in my experience, we can roughly break it down into the following questions:

How much is left? Always, always, always have a live working version of the budget, broken down however is most readable and understandable. Do not count on other people. It is your department and your budget — own it. Finance departments have delays in entering information and make mistakes, but you should know every in and out: when you make a purchase, when you pay a bill, when an invoice should be on the way. We have used either spreadsheets with a pivot table that has on it the entire department budget broken down into categories by sport. In addition, each sport has its budget in full, with those budgets then broken down into individual pieces on subsequent tabs. On top of that, we’ve had a sheet tracking all income/expenses in real time. Every time a purchase order went out, an entry was made before the order left the office, and the same process was followed with anything generating revenue before it was submitted to finance. It takes time to set up but is well worth it.

How will we make it work? Get as creative as possible. Ask your coaches to do the same and never be fearful of speaking with close colleagues about how they handle their budgets. You would be surprised how many peers are willing to open their books regarding details of how they construct efficient budgets. Also, be sure to look at the entirety of the budget and not just individual pieces. There are undoubtedly areas where you have saved, some areas that may be trending to go over-budget, and places you can move money within or across areas. If allowed, move money around within your department. Think outside of the silos and items that were proposed in the budget. Just because you put in $5,000 for equipment does not mean you have to use all of that money for equipment — use it where most needed. If you cannot do that across teams, consider it within a team. For me, the most important utilization of this was in regard to salaries. Is it more important to have three assistant coaches, or to get one exemplary assistant? Can you lump salaries together to entice that person. At certain institutions, this may not be an option, but if it is, use it to your advantage.

What do we need for next year? "Need" is a relative term. Create, and have your coaches create, a "need list," a "want list," and a "pie-in-the-sky list." Scrutinize every need, and demand answers to tough questions. It is your responsibility as an administrator. You don’t necessarily have to nitpick whether you need to order 12 basketballs or 13, but train your coaches to reason through their purchase requests as opposed to just asking for things. To make this work, every so often you may have to figure out how to make a "want" item and a "pie" item happen, so think long-term and plan for that eventuality. If coaches know you have the best interest of their team and the department in mind and are working on getting them something they want for their team — especially if you can make it happen every now and then — you will get total buy-in to a real and constructive budgeting process. 

Where can we cut and where do we need to add to maintain or enhance success?This part is never easy, but it's part of the job of administrator. There is no simple template to follow here, which is why it is so important to define success both as a department and as individual teams. However, this can take the form of looking into new vendors, renegotiating with vendors you currently use, or potentially moving to a vendor who can outfit the entirety of your department. Volume is key: the more items you purchase, the less they cost. Buying in bulk could also help you take advantage of loyalty programs that many vendors provide. It pays dividends to do your research, talk to many vendors and work the best deal. In the long run, I’ve always found it easier and more cost-effective to go with a single vendor when possible, as opposed to using many individual companies.

These questions, and the thoughts and further questions or discussions they encourage, will hopefully help you as you battle budget-crunching, continue through your year, and plan for the future.

Finally, remember to budget with an eye toward the future (I suggest three years out), and your department will be on solid financial footing.

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