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Editor’s Note: Penny King, Texas A&M’s senior associate athletic director/business, sat down with 12th Man Magazine’s Homer Jacobs to discuss all aspects of the athletic department’s finances and business operations. Q: From a cash flow point, what is the status of Texas A&M’s athletic department? King: From an athletic department standpoint, I think it’s great. Tickets are up, 12th Man Foundation contributions are up. We’ve had success from some teams other than football, so I think that will help. Since we get no state money and no university funding, we’re an auxiliary enterprise. What that means is we earn our own money. We’ve been very fortunate with our support because it’s up this year.
Q: A lot of football programs and athletic departments are having major financial problems. Where does A&M fit into that mix? King: I’d say right now we’re breaking even, primarily because of the new facilities that have come on-line. Not only do you have the cost of the bonded indebtedness to get the facilities, but you have operational costs. From a utility standpoint, a staffing standpoint, custodial costs… all of those added together add a huge expense to your budget. We have tightened our belts the last few years and said ‘no’ a few times when we haven’t wanted to but we’ve had to. There are things we’d like to do, but just haven’t had the money to do them. Q: But you still think A&M is in a good position financially for the foreseeable future? King: Absolutely. We’ve had some successful teams, and certainly football earns the money for everybody. We’ve had a lot of television revenue, and certainly joining the Big 12 has been very beneficial to us financially. Everything is on a positive note there. Looking at the (Championship Vision) Capital Campaign that the 12th Man has started, it’s really going well. We’re hoping to reach that goal for the South End Zone Complex soon and surpass that so we can prioritize some of our long-term facility needs. Q: There are several ways in which A&M could improve its athletic budget, but I would think increased men’s basketball revenue would be a major opportunity. Do you think that’s the case? King: I think that’s the area we have a lot of potential to grow in. We had more support last year and more season tickets sold. We put a better product on the floor, even though injuries really hurt us last year. That’s an area where we have the option to make some revenue. Once you get into the NCAA Tournament, there is quite a bit of revenue generated for the individual that participate. Even without participating in the NCAA Tournament, we get a large amount from the tournament every year just for being a Division I school. Q: What is A&M’s total athletic budget for the 2001 fiscal year, and how do those numbers rank in the Big 12? King: About $33 million. Last year, it was $29 million. We’re probably third behind Nebraska and Texas. The conference is trying to compare budgets, and trying to compare apples to apples is impossible. We’ve found that out with just the 12 schools, much less all the schools in Division I-A. There’s really significant differences in capital expenditures and the bonded indebtedness. Every school counts that in a different manner. Some don’t count it in their athletic budgets at all. In our case, we don’t count 12th Man Foundation expenses. For many of the other Big 12 schools, (fund-raising) is part of the athletic department. It’s really difficult to try to compare the size of budgets. Different accounting systems, different policies that universities have and different ways that each school has to report their revenues and expenses really cause some problems (for comparison). It’s really hard to gather it all under one umbrella to look at it. The comparisons you see sometimes are a little misleading. Q: Are the costs of running a big-time athletic department out of control? King: I would say it’s not out of control at all. I think compared to everything else in the world… inflation has just escalated everything out of proportion to what we saw it 10 years ago. The value of intercollegiate athletics has grown in the minds of people, so they’re willing to pay more to come see football or basketball. As long as we don’t price ourselves out of the business from a fan’s standpoint, I think we’ll be able to continue to grow. Q: Is the arms race for facilities in major college athletics going to slow down anytime soon? King: I think that’s going to continue. Eventually, we’re going to run out of people and money. But truly, it is just part of the competition. As long as we want to continue at that competitive level – and I can’t imagine that ever changing at Texas A&M – we’ll continue to compete with those people with facilities. Is it out of control? Probably not. Is it hard to control? Oh, yeah. Q: Has the revenue that is streaming in from the tickets sold from The Zone at Kyle Field surpassed your expectations? King: It’s happened, and we are tickled to death. We are so thrilled with that facility. We got a lot of flak about tearing up perfectly good seats, according to people. They said we didn’t need them, but we’ve had such an increase in graduates every year and a demand for good seats. They’re just like everybody else who has been out of school for 10 years… they don’t want to sit in the end zone in poor seats. But The Zone has just been fantastic. We’re just so thrilled with the whole thing. It’s changed everything. It’s far more than we ever expected. We have a waiting list for suites, and the Zone Club is almost full. Q: Do you get many calls from other schools wondering how The Zone has worked out? King: We get calls constantly, particularly from schools who are looking at renovating their stadiums. We’ve had numerous schools come through with their administrators and presidents sometimes. Builders and architects come through, so we are (the mold), no doubt. You’ll see a lot more of those (end zone additions), and a major reason is Kyle Field. It makes us very proud to be able have done it. Q: What’s the most expensive part of running an athletic department? King: Salaries are expensive and one of the largest parts of our budget. Supplies and equipment, all of those costs are going up. Travel, of course, is going up. And with the new restrictions and guidelines, I’m sure costs will escalate there. Scholarship costs have increased a great deal over the last few years. Any time a university has a cost increase on tuition or fees, it affects our budget, too. Q: What is the scholarship cost for a student-athlete at Texas A&M? King: For an in-state scholarship for the current year, it’s $9,700. For an out-of-state scholarship, it’s $15,600. Q: You are also the gameday manager at Kyle Field. How many fires do you have to put on Saturdays? King: We’ll have games where I won’t get three phone calls. It’s the planning that goes into in preseason that prevents a lot of those things. It’s a challenge to get people in the right places, but we do a lot of preseason planning. Normally the (big) games go smoother than a McNeese State game. It’s always tough to get the first game out of the way. After that, you can kind of take a deep breath. Very seldom do I get to see a game. I have the emergency phone in the press box, and we have constant chatting going on with the ushers about the gates or tickets that have been lost, etc. There’s always a challenge. If the games are on TV, I tape them so I can watch them later. Q: What about the planning for last year’s game with Oklahoma, when ESPN’s College Gameday crew showed up? King: The plans that went into that were just mind-boggling. We spent hours and hours meeting with different groups to make sure everyone knew what everyone was doing. Communication is the biggest thing. All the plans that we made worked, and everything went well. It was so rewarding to see the ending of something like that and take a deep breath and say, ‘Wow, that was awesome.’ Q: When you arrived at A&M in 1972 and started in the athletic department as a ticket dispenser and payroll clerk, could you ever have imagined you would hold the No. 2 position at one of the largest athletic departments in the country? King: It’s amazing. I’ve been around athletics forever. My dad was the SID at Baylor, and he had been a sportswriter all his life, so I had always been involved with sports. Q: In your opinion, what does A&M need to do to take the athletic department to another level, both financially and competitively? King: I don’t know if there is a specific thing you can point to. I don’t know if you pay your coaches more are they going to win more. I don’t know if you spend $100,000 more on recruiting will you get a student-athlete to come here. I don’t know that there’s on thing. I think we have one of the best coaching staffs across the board. From archery to football, I think we have good people. Going to a national level, of course, that’s our goal. We want to be in the top 10 in every one of our sports. It’s difficult to pinpoint just one thing. |
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