The University of New Mexico athletic department ended the third quarter of the fiscal year with a negative net balance of $2.25 million, according to a report during Tuesday’s regularly scheduled board of regents meeting.

There were a number of factors that led to the shortfall, said athletic director Eddie Nuñez, including the lingering effects of the coronavirus pandemic and the economic downturn associated with it.

Projections call for a year-end shortfall of $3 million or more.

The dire news fell in step with most other campuswide reports during the 4 hour, 10 minute meeting livestreamed over the meeting platform Zoom. The regents dealt with threats of looming campuswide budget cuts, decreased enrollment and contingency plans to deal with student and staff safety whenever school resumes.

UNM is in the middle of finals week for the spring semester, and school officials are still not clear whether the campus will reopen in time for the fall semester in August. President Garnett Stokes told the regents the university will comply with the directives of the governor and state Department of Health for resuming any semblance of normal campus activity.

The athletic budget shortfalls had been anticipated even before the pandemic, making Tuesday’s report somewhat anticlimactic. But, Nuñez said, there was a real chance his department’s bottom line would have been zero had the economy not taken a nosedive.

“This whole thing has forced everybody to play a shell game until it’s over,” Nuñez said. “Whether we start sports again this year or next, it’s going to happen to everyone. It’s just something we all have to do.”

About half of fiscal year 2020’s athletics shortfall comes from the $1.2 million it was due from the NCAA men’s basketball tournament, which was canceled after the initial virus outbreak in mid-March. Another $1 million loss comes from its multimedia partnership with Outfront Media, which took a substantial hit when neither entity could generate sales after the pandemic began.

The rest is the result of lost revenues from special events, such as the high school State Spirit Championships, the abbreviated State Basketball Tournament, the PBR’s Ty Murray Invitational, parking revenues with the Albuquerque Isotopes and New Mexico United, and the loss of scholarship fundraising events such as the department’s annual golf tournament and its year-end gala.

“Those four are major drivers in why this budget right now, this third quarter, is what you’re seeing,” Nuñez told the regents.

Nicole Dopson, UNM’s director of financial operations for academic affairs, oversees the athletic department’s bottom line. She told the regents the department’s scholarship fund is looking at a 15 percent to 20 percent reduction as a direct result of cancellations of the gala and golf tournament.

“Given the current circumstances with the changes in operations due to COVID, we are expecting expenses to actually be down in the next few months,” Dopson said. “Most of these expenses are associated with special events, sporting events that aren’t happening and then a little bit of a decrease in travel.”

Had life gone on as normal with no pandemic, Nuñez said Tuesday’s regents meeting would have taken on a much different tune.

“If all that happens,” he said, “then we have a chance to break even.”

The athletic department could take a much deeper cut if the 2020 college football season is canceled.

James Barron and Will Webber discuss the significant toll the COVID-19 pandemic has had on sports locally and nationally, and also share their thoughts on a bizarre state basketball tournament that finished in front of no fans.

At stake is $3.5 million to $4 million due each member of the Mountain West Conference as part of its new TV rights agreement with CBS and Fox, not to mention the seven figures each school gets as part of the annual College Football Playoff.

Also at stake are guaranteed game contracts with Mississippi State and USC. Both schools would pay UNM a combined $1.95 million for football games in September.

Nuñez has already earmarked part of that money to pay off the remainder of former head coach Bob Davie’s contract.

“The truth is, the big schools in the Power 5 are taking more of a hit than us because we’re a lot closer to the bottom than they are,” Nuñez said. “The fall isn’t as far of a fall for us as it is the other guys.”

For reference, he cited a handful of schools in the Big Ten and Southeastern Conference, leagues whose power programs stand to lose tens of millions of dollars in revenue if this trend continues.

Nuñez said his department has implemented freezes on spending and travel, as well as kept a number of job openings vacant.

“We’ve done everything we can possibly do at this point,” he said. “Most of our expenses, of course, happened in the winter/fall seasons, so this time is a little bit harder to minimize those costs.”

Notes

Academics: Men’s basketball, men’s golf and women’s golf have been recognized by the NCAA for having their 2018-19 Academic Progress Rates in the top 10 percent of their respective sport.

According to UNM, it’s the seventh straight season the women’s golf team has been honored and the fifth in a row for the men. It’s the basketball team’s first recognition since the 2012-13 academic year.

Men’s basketball: The Lobos formally introduced Jeremiah Francis as their newest addition. The sophomore point guard announced last week he was transferring to UNM from North Carolina, where he spent his freshman season with the Tar Heels.

“Jeremiah truly brings a complete package to Lobo basketball,” head coach Paul Weir said in a statement. “His basketball abilities are tremendous, yet are surrounded by a young man of high character and a thirst for winning.”

Francis had an injury-plagued season with UNC, appearing in just 16 games with three starts. He averaged 3.3 points, 1.3 rebounds and 1.6 assists.

“I believe [attending UNM] will be an incredible opportunity for me and my family from an academic standpoint, as well as a basketball standpoint and I have bonded very well with the coaching staff since entering the transfer portal,” Francis said.

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