KNOXVILLE — Tennessee’s athletic department will be keeping $6 million each of the next three years instead of contributing that money annually to the university as it did previously. The department is trying to improve its financial situation after reporting a $3.98 million deficit for the 2011-12 fiscal year
The move should aid athletic director Dave Hart in his search for a football coach while also helping fund the $5 million buyout to Derek Dooley, who was fired Sunday.
“As we begin our search for a new coach, I have assured Dave that he will have the support and resources he needs to be successful,” Tennessee chancellor Jimmy Cheek said Tuesday in a statement released by the university.
In announcing its deficit in August, Hart mentioned that $6 million annual gift to the university as one item that needed to be evaluated. Each year, the athletic department had provided a minimum gift or transfer of $6 million that primarily was used for scholarships and fellowships. Cheek said the school would continue to honor those commitments, but they now would be funded primarily through private gifts.
“The money was committed under different circumstances, and we now need to allow athletics to use these dollars to attain financial stability and invest in the future,” Cheek said.
Tennessee’s athletic department had to deal with its deficit by dipping into reserve funds, dropping that to just below $2 million. During the press conference that announced Dooley’s firing, Hart discussed Tennessee’s financial difficulties.
“We have a $1.9 million reserve, which in the SEC is unheard of,” Hart said. “We compete against people who have reserves of about $50-100 million. We are in a tough position financially. The chancellor doesn’t want us to be at a competitive disadvantage of any nature, whether it be financial or academic or in any other arena where we are trying to compete and trying to get back on top of that pyramid. We are in a tenuous position, at a crossroads with our athletics program, but we have people who understand that and are committed to helping us overcome those obstacles.”
As he mentioned Tennessee’s budget situation Sunday, Hart indicated it wouldn’t be a detriment in hiring the best possible coaching candidate. Cheek issued a similar message in his statement Tuesday.
“I know that winning championships and competing at the highest level lifts the national profile of the University of Tennessee,” Cheek said. “As chancellor, I am committed to winning both on the field and in the classroom.”