In 2017 you were projecting a budget loss, and 2018 a little profit? 2019 another deficit?
“Yeah. Did you see the presentation we did for the Board of Regents (in April)? It’s posted online. It’s funny. When we did it last year and we were running a deficit, everybody knew about it. This year we went in and it was a deposit, nobody reported on it.
“We wanted them to see the progress, because there’s a lot of progress. But we also needed to recognize that long-term we still have a lot of challenges, but we have a lot of opportunities. We wanted them to see what those opportunities looked like.
“We had gone in and projected a deficit for this year of about $6 million. The following year, because of Don James Center revenues we thought we could get close to breaking even and then back to ’19 when we start back to deficits again.
“Unlike every other premium seat in Husky Stadium and Tyee seat, Don James Center people pay for their seats for five years. They pay it over a two-year period and then get their seats for five years and they don’t pay a donation. They just pay for tickets. So over the course of a two-year period we get $12 million in contributions that come in and then the next three we don’t, so that’s why we go down. But when you look at 2022, we come out of it. So that’s when we project we’ll be operating with cash flow again. But there’s three years where we have deficits.
“But what happened is we closed the gap this year. So instead of running almost a $6 million deficit we’re going to operate with cash flow - and that includes the basketball changes, so that was significant for us. The main factors for that were increased revenues around football gate sales. This season was a very successful game-changer campaign that was just annual fundraising with major gifts support from incredible donors, a little bit on apparel and concessions and those type of things. We had a big swing there. We had expenses that were also up with the Peach Bowl, with the bonuses that go to those coaches and with the change in men’s basketball, to still have a swing to be able to just barely break even this year.
“Next year we’ll break even with a little bit of money left over and then the following three years we’re projecting deficits. We have the reserve to cover it but we want to close that gap. The numbers we had shown them (Board of Regents) last year, the deficits were going to start at around $8 million. We’ve cut that number in half, so we’ve made a lot of progress. But this year was a huge success story because of fans, because of donors, because of our staff, because of our football team. We’ve really made great progress.”
Where are the new revenue opportunities down the road?
“There’s really only a couple of revenue streams that you have a lot of control over right now within our program, and some of these revenues are only assigned for a period of time because of contracts. Gate, gate and gate. Ticketing, ticketing, ticketing. In football and in men’s basketball. We believe there’s still upside in football, between tickets and contributions - anywhere from $5-7 million a year if we were really, really humming and had more games that were sold out. Basketball, there’s an uptick there that could really go up, a million or two million at some point in time. There’s not as much potential in men’s basketball as there is in football just because of the size of the stadium.
“We have an apparel deal that’s coming up in a couple of years. There’s an opportunity there for increased revenue. Contributions and fundraising - another area we can control and raise money. What’s set right now is multimedia rights is set until 2024. Our television contracts are all set through the Pac-12 for several years. There are some incremental revenue possibilities with the Pac-12 and the Pac-12 Network. They are possible, but not part of our projections.
“The other thing that we presented (to the Board of Regents) - and I’m not necessarily saying I’m advocating for this, but we’re looking at it - what are the potentials of increasing beer and wine sales throughout all of Husky Stadium. We had an incredible group of UW MBA students that spent all year studying alcohol sales in college venues - the pros, the cons, the risks, the revenues. The revenue uptick here that they projected was about $2 million a year if we had it in football and a portion of basketball, baseball and softball. So we put that in. We’re not saying that’s what we’re doing yet. It’s pretty controversial here. It’s not illegal. We can do it. We can get things approved to do that, but it has to be something the University community is on board with. I have to feel like it’s the right atmosphere for fans.
“What I’m torn about with this right now is, the game day experience for people is so important. The beer and wine thing is important. It’s why 6,000 people leave at halftime to go to the parking lot and 3,000 people go to the Zone. So you have almost 10,000 people that go. And then you have another 8,000 people that have premium seats, the rest don’t have access to beer and wine. If we could create an environment where they would have more access to that in-venue, long term we should be thinking about not letting people leave Husky Stadium. That improves the game day experience. It improves revenues and enhances safety for sure. So the beer and wine option is something we’re looking at.
“We have this really tricky city-mandated transportation master plan that was made in 1987 by the city council. It was mandated that we do all the bussing when we built the north deck. Nothing has been updated to take into account Sound Transit and even Uber and all these other things that we have that people didn’t have before. If we can get through city council and get another master plan, we can host a couple of cool events in our stadium, like concerts. We’ve had people that have really wanted to do concerts here, and when we’ve told them it’s going to cost you a half a million dollars to bus people, because that’s what a Stanford game costs us - a half million dollars to bus people - it’s over. So we’ve looked at a couple schools that have had events per year - not a lot, but a couple - and their uptick is anywhere from $500k to a million dollars depending on that.
“If you look at all the potential we have and if you look at our original financial stability plan and then our improved financial stability plan, it’s getting better where they need us to be."