University of Hawaii athletic director Ben Jay is expected to paint a bleak picture of future department finances — including the prospect of record deficits and some options for cutting sports and raising fees — in a scheduled report to a Board of Regents committee Thursday.

The athletic department has run at a deficit for 11 of the past 13 years and has been projected to finish $3.5 million in the red for the fiscal year that closes June 30.

But an appearance Tuesday by UH officials before the House Committee on Higher Education, where it was suggested the deficit could reach $4 million this year with $3.8 million next year and $5 million in 2017, provided a glimpse of the report’s tenor.

The largest athletic department annual deficit to date had been $3,379,132 for the 2013 fiscal year.

The regents’ Committee on Intercollegiate Athletics last year tasked Jay with compiling a report on the department’s financial standing before he leaves. The agenda for Thursday’s board committee meeting lists a "review of financial state of UH Manoa Athletics report."

Jay announced his resignation Dec. 9 and is remaining on the job pending the selection of his successor.

People who have seen the 93-page report, "The Financial State of Hawaii Athletics: Version 2.0 — Revising the Game Plan" — describe it as "blunt," "eye-opening" and "comprehensive."

People who have seen the document say the report says, "given conservative growth of current revenue streams and projected growth in operating expenses, our analysis indicates that the department’s history of year-end operating deficits will certainly continue."

The UH administration is already seeking $3 million from the Legislature but officials concede that if the school offers cost-of-attendance stipends to its athletes beginning Aug. 1, as many Division I schools are planning to do, the deficit will deepen by more than $1 million.

Rep. Isaac Choy (D, Manoa), chairman of the House Higher Education Committee, Tuesday asked UH representatives, "So, we’re at a negative $3 (million), $3.5 (million), and if that subsidy thing comes in, we’ll actually be down $5 million?"

Jeff Portnoy, chairman of the Regents committee on Intercollegiate Athletics, replied, "at least."

Under questioning by Choy, Jay said only football among the school’s 21 teams makes money. He said women’s volleyball breaks even and the rest of the teams run in the red.

Jay’s report Thursday presents limited options for cutting as many as three teams, the most that could be dropped without affecting Division I or conference membership requirements and Title IX. Under federal law, schools are bound to provide proportional opportunities to women and men in education, including athletics.

Under one scenario, dropping swimming and diving for both men and women, in addition to coed sailing, would save $1,377,727 million but eliminate 98 opportunities.

Another option, eliminating men’s volleyball, women’s sailing and coed sailing, would save $533,921 because men’s volleyball brings in $285,000 in revenue. That would trim 68 opportunities.

Cutting football, along with women’s swimming and diving, women’s sailing and coed sailing, the report concludes, would actually cost the department nearly $2 million and not leave it compliant with Title IX proportionality, the report said. An estimated 201 opportunities would be lost.

In addition, Jay told legislators, "I really fear that our fans will not support it (UH athletics) if we’re not playing Division I football."

Dropping to Division II or Division III, Jay told legislators, "doesn’t work. The expenses are the same. Having to pay the travel subsidies will not go away."

In addition to the possibility of dropping sports, Jay’s report is also expected to raise the question of hiking student athletic fees. Currently students pay $50 per semester but the report lists an option of raising it to $75.

UH is the only major college that pays conference travel subsidies, approximately $1.2 million per year. In addition, studies show UH receives less in school and outside subsidies than most of the schools it competes against in the Mountain West and Big West Conferences.

In 2013, then-Manoa Chancellor Tom Apple "forgave" a $17 million accumulated net deficit built up over the previous decade and charged the department with balancing its bottom line in three years.

ON THE NET
Report: Review of Financial State of UHM Athletics