Chancellor Carol Christ took over for Nicholas Dirks this past week, becoming the first woman chancellor in the University’s history. Welcome and Go Bears!
Christ will come in with many tasks to accomplish, but perhaps the most daunting role ahead of her doesn’t have anything to with academics or the university proper. Christ is known for being one of the top people in charge of balancing the budget, and that role will only become more paramount as the university and the athletic department face even stronger budget constraints.
Since resuming her former duties as executive vice chancellor and provost, Christ has been instrumental in tackling what had been a $150 million budget deficit, working tirelessly with constituencies across the campus to identify efficiencies and new income streams.
Christ has viewed the academic task force report, which has put Cal in a Catch-22 bind: The California Golden Bears athletic department could bleed slowly with the sports they have, or risk cutting major sports and see massive losses in overall donations (not just to the AD, but to the university as well). Obviously, neither situation is quite palatable, so the task force’s recommendation was more of a suggestion chart, coming up short on concrete solutions.
Christ makes it clear what her priority is though—Cal has to get out of the red, fast. Here’s what she said to the Daily Cal:
“I don’t think that there are going to be decisions made this summer about reducing the size and scope of the athletics program and there are a lot of prior decisions that need to be made before we get to that one,” Christ said.
“You either have to rebudget the unit so that they’re working within a realistic budget or you have to increase revenues or reduce expenditures so that the budget is balanced,” Christ said.
The albatross hanging over Cal is the Memorial Stadium debt, which is only about five years into a 30 year repayment cycle. Stadium ticket ESP sales have lagged well behind, leaving the stadium debt to stay negative. Even though the deficit was reportedly down $4.65 million this past season, the Bears are still projected to lose millions of dollars.
One potential solution to the athletic debt is to finally consider some sort of reconciliation between the university and the athletic department. Cal is one of the few universities out there that has separate university and athletic arms. It can be argued that this type of arrangement has led to inefficiencies and added layers of bureaucracy. It sounds like Crist and task force co-chair Robert Powell think along the same lines.
“Central campus has also been covering IA’s ongoing deficits. In 2015-16, for example, the Chancellor’s office transferred $23M to IA to cover its deficit,” Powell said in an email. “There are significant cross-cutting transfers between IA and central campus. But the current level of de facto campus support is unacceptable. IA’s operating and capital expenses must be aligned with its revenues.”
Budgeting differently so some of athletics’ responsibilities go to campus would help move Cal Athletics’ deficit down. Christ also mentioned the idea was a possibility.
Taking some of the stadium debt off Cal Athletics’ books and moving it to campus could help reduce the deficit. Powell pointed to the parts of the debt specifically related to seismic retrofitting as a possibility.
Time for Cal to think outside the box, before the whole athletic department is living out of a box. Thankfully, Christ seems up to the challenge.