'It's going to be choppy:' Football season without fans could cost UNC, NC State millions

By Joe Giglio, WRALSportsFan

Bubba Cunningham doesn’t sound like someone facing a potential $52 million loss in revenue.

The athletic director at the University of North Carolina understands the financial reality for the college football season caused by the COVID-19 pandemic — which could cost UNC nearly half of the $107 million in revenue it reported for the 2019 fiscal year — but he’s trying to be circumspect.

“There are days where you’re like, ‘This is really hard,’ but we are lucky to be doing what we are doing,” Cunningham said in an interview with WRAL on Friday. “At some point, we will figure it out.”

As the ACC proceeds tentatively towards an altered college football schedule, UNC and NC State are prepared for significant financial hits for season that could be played without fans in the stands and could shee some games canceled due to worries about the spread of the coronavirus. NC State is bracing for cuts nearly as deep as UNC's. NC State reported $92.7 million in revenue to the NCAA in 2019.

It could be worse. Wisconsin AD Barry Alvarez recently estimated the Big Ten school is facing a $100 million in lost revenue. Penn State AD Sandy Barbour projected the same nine-figure loss for the Nittany Lions.

Citing health concerns and uncertainty about the long-term effects of the coronavirus, the Big Ten decided on Tuesday to postpone its football season until the spring. The Pac-12 followed suit on the same day.

The ACC, SEC and Big 12 — the other conferences in the “Power 5” — reiterated their decision on Tuesday to continue with a modified fall schedule. UNC and NC State are scheduled to open their 11-game seasons, with an expanded 10-game ACC schedule, on Sept. 12.

That’s the so-far, so-good news for UNC, NC State and the Triangle businesses who rely on college sports. David Harris is the majority owner of Sammy’s Tap & Grill and Amedeo’s Italian Restaurant, a pair of popular hangouts near NC State’s campus in Raleigh.

The coronavirus has hit the restaurant industry particularly hard the past five months. During "Phase Two" of the state’s reopening plan, restaurants are allowed to operate at 50 percent capacity.

Harris said early return to campus by students has helped Sammy’s, and Amedeo’s has been helped by consistent take-out and delivery orders.

“We do rely on people coming in to watch State play,” Harris, 55, said. “If we lost both football and basketball, that could be devastating.”

Actually, the basketball part of the equation is why NC State and UNC are better off than their football-crazed Big Ten counterparts.

UNC’s projected ticket sales for football this season were $10 million, according to Cunningham, compared to $14 million for men’s basketball.

NC State’s ticket revenue, according to the 2019 financial report it filed to the NCAA last January, breaks down to about $7.5 million for basketball and $14 million for football.

Ticket revenue will be down for both revenue sports. The other main revenue stream is the ACC's media rights contract with ESPN and the ACC Network.

The ACC schools will have a better idea of their financial stability in October when they receive their share of revenue from the ACC Network. The channel launched last August. The numbers from the 2019-20 fiscal year haven’t been finalized.

The payout per ACC school averaged about $29 million per school, according to the ACC’s most recent tax return. That was before the ACC Network’s debut, but that number, while a significant increase, lags behind the $55 million payout for Big Ten schools from their cable network or the SEC, which averages $43.1 million per school.

Even with the 2019-20 college basketball postseason cut short, the money from the ACC Network will still almost certainly go up.

“The ACC Network has delivered at or above the projections,” Cunningham said.

That will help UNC and NC State in the long term, which is what both schools are trying to manage. Even under the worst-case scenario of no football this year, Cunningham said the fiscal year wouldn’t be a total loss.

“Even if you don’t play, you don’t go to zero,” Cunningham said of the projected revenue, citing the school’s contracts with Nike, Learfield IMG College, donations from the Rams Club and student fees.

“Here’s the challenge: Whatever we do this year creates a debt. However significant that is will determine what we are able to do in the future.”

Fred Demarest, NC State’s senior associate athletic director, said NC State is taking a similar approach to the potential financial challenges of a unique college football season.

“We are certainly aware of the potential immediate financial impact of the coming year but are also mindful of longer term impacts,” Demarest wrote in a text to WRAL. “We are trying to best position NC State beyond the coming fiscal year.”

In the short term, Cunningham might as well speak for everyone when he says: “It’s going to be choppy all year.”