Hawai'i athletics finally profitable
By Stephen Tsai
Advertiser Staff Writer
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The University of Hawai'i Board of Regents yesterday approved an independent audit that showed the athletic department earned a net profit of $7,483 for the fiscal year that ended June 30, 2006.
It was UH athletics' first profitable fiscal year since 2001.
The department still owes $876,592 in debts accumulated from fiscal years 2002 through 2005 — an IOU that must be paid to the school's general fund.
Still, athletic department officials were relieved to emerge from four consecutive years of negative budgets.
"We're fine," athletic director Herman Frazier said following his address to the regents. "That's the cards you're dealt with. You deal with it."
The audit, conducted by Accuity LLP, an offshoot of PricewaterhouseCooper, showed:
In fiscal year 2002, Hugh Yoshida's last year as UH athletic director, the shortfall was $1.9 million. Yoshida used the so-called rainy-day fund — money from previous department surpluses — to help cover the deficit.
Frazier was hired in August 2002. At the time, Yoshida's salary was still on the books, and head coaches Riley Wallace and Mike Wilton had signed new contracts.
"If you didn't do anything, you knew the (deficit) numbers would be at least that high (as it was in the previous fiscal year)," Frazier said.
The department had shortfalls of $2,475,000 in fiscal year 2003, $545,00 in fiscal year 2004 and $93,000 in fiscal year 2005.
For fiscal year 2006, the athletic department reported revenue of $21,367,269, with expenses totaling $21,359,786.
Frazier traced the revenue spike to premium-seat contributions and a more lucrative pay-per-view television agreement. Both deals were implemented for the 2005-2006 academic year.
'Ahahui Koa Anuenue, the athletic department's fund-raising branch, implemented two premium-seating plans. Season-ticket buyers were assessed a fee for the right to buy tickets in preferred areas at Aloha Stadium and the Stan Sheriff Center. Also, they could purchase premium packages of $20,000, $10,000 or $5,000.
Prior to the plan, Koa Anuenue earned between $800,000 and $1 million annually. Of that, between $600,000 and $800,000 was used to pay for scholarships.
Frazier said Koa Anuenue earned $3 million from the premium-seating plans. Koa Anuenue president Vince Baldemor said more than $2 million now goes to scholarships.
Baldemor said his group sold 10 $20,000 packages, about 15 $10,000 deals and "close to 200" $5,000 packages.
Frazier added: "We're getting more money now from TV. We're getting more money from radio. At the same time, we're trying to reduce the deficit."
Frazier said he was not discouraged that only the same four sports made money.
"We don't run programs and say who loses money and who makes money," Frazier said. "We run programs to have a well-balanced athletic program. It's a misnomer to say softball lost money. They're not supposed to make money. Women's swimming is not supposed to make money.
"In our theory in athletics, you're supporting these programs, and that's it," Frazier added. "Let's say you're an athlete in one of those particular sports. You're working your butt off just like everybody else. You're competing hard like everybody else. To read that you lost money, they're not into that. They're into competition."
Reach Stephen Tsai at stsai@honoluluadvertiser.com.
