This blog summarizes the key takeaways from our fiscal resiliency podcast, episode 20.
Adam Barnes, Associate Athletic Director of Business Operations and CFO for the University of Wisconsin’s (UW) Athletic Department, recently joined Dave Capitano, Baker Tilly’s higher education industry practice leader and Katlyn Andrews, a higher education risk advisory manager with Baker Tilly, on the firm’s Higher Ed Advisor podcast series. The discussion focused on how UW’s athletic department and finance committee maintained financial resiliency in the early months of COVID-19 while expanding a program to support student athletes on and off the playing field. Barnes also talked about the key partnerships the university has engaged in to improve the use of key financial data as well as support athletes as they gain more control over the use of their name, image and likeness (NIL).
Barnes oversees an annual budget of approximately $160 million. The major revenue streams are media rights ($55 million), ticket sales ($35 million) and donors ($15 million). He noted that since media rights are negotiated more at the conference level than the individual school level, his team focuses on key revenue streams over which they have the most control – ticket sales and donors.
“When we talk about strategic initiatives, I like to start with who is our customer,” Barnes said. “Sometimes our work is focused on our donors, and sometimes we're focused on our current student athletes or prospective student athletes. Different audiences require slightly different perspectives and approaches.”
Barnes shared that their strategy at the beginning of the pandemic in 2020 – the COVID-19 pause – reinforced the university development office’s “Badger Legacy” campaign. In early 2020, the school had already collected much of the ticket revenue for the year 2020 sporting events without knowing if they would even be able to have games or allow spectators into games. The development office was able to convince two-thirds of all ticket holders to either donate their money or roll it forward for tickets in a future year, which helped the university’s athletic programs from a cash flow perspective.
Barnes noted that COVID-19 accelerated some things that the university already planned to do. In 2021, the university launched a “Power of Us” campaign focusing more intentionally on diversity in the athletics department, the campus community and the larger metro community. The university is also looking at ways of improving the fan and student athlete experience from a safety perspective, from upgrading HVAC within its athletic facilities to upgrading its ticket platform to a “touchless” experience with electronic and mobile tickets.
The university has 23 varsity sports, and a guiding principle throughout the pandemic was to continue to provide the best opportunities for student athletes, whether it was just to practice or to actually compete while still continuing their schooling, Barnes pointed out.
The university’s Career in Leadership and Academics Teams continue to sponsor an initiative called Forward 360, which provides a variety of services for student athletes both on and off the field, including mental health and career readiness services. The school believes it has been successful in supporting student athletes’ goals, whether that is postsecondary education, a job right out of school, or a volunteer position like in the Peace Corps.
Barnes recognizes the importance of accessing the right data so his office can manage revenue better. The finance office uses a software tool as a shadow system over the university’s main accounting system. The software allows his office to access financial information in a format that can draw actionable data out of; it also allows them to conduct forecasting and budgeting. The university, like other Power 5 athletic departments, outsources some finance functions to partners, like Legends. One challenge Barnes continues to work through is how to bring in data from partner systems and leverage that data to provide better insights on key financial information and create opportunity to grow UW’s revenue streams.
Since the NCAA has allowed student athletes to profit from the use of their name, image and likeness (NIL), Barnes noted the school’s partnership with Opendorse has helped educate student athletes about what they can and cannot do regarding NIL as well as track any deals athletes have made. He added that the school has not yet seen a shift in donations away from the university as a whole and toward support for individual athletes. While noting that some corporate sponsors of college athletics may shift some revenue from school programs to individual athletes, the policy is so new that it is hard to spot a trend yet.
Barnes noted that the good working relationship between the finance office and the central campus is paying off for student athletes, alumni and the donor population, and the university.
For more information, or to learn how Baker Tilly’s higher education specialists can help your institution’s athletic department, contact our team.