Follow the Money: The Jimmy Cheek Story

The key players in our tale tonight, pictured at middle and at left. The key figure at all times is middle right. - Randy Sartin-US PRESSWIRE

Figuring out finances isn't the easiest thing in the world. But you can go through what's available about Tennessee's athletic department finances over the last few years and get a picture that's quite chilling.

I'm going to begin this like I would begin every single post if I could: let's talk about Pat Summitt. More specifically, let's talk about Pat Summit's outgoing press conference, where she shared the stage with her son (looking abashedly out of place), Holly Warlick, Dave Hart, and Jimmy Cheek. Watch the video if you haven't, although be warned - the full version is 46 minutes. (You can probably just listen to it; I won't tell anyone.) At that conference, I'm pretty sure a Chia pet could've been presented on stage and received a two-minute standing ovation - it was that kind of conference.

That Chia pet would've gotten a better reception than Jimmy Cheek did. That says something, doesn't it?

Granted, Cheek doesn't have the best reputation among fans to begin with. That's either grudgingly earned or well-earned depending on who you talk to. Still, we need to rewind a bit - you don't get to where you're going without knowing where you started.

Cheek came on board in February 2009. He's done an admirable job improving the standing of Tennessee academics (which: well, you'd like to hope so, since there's an institute of higher learning attached to the football team and basketball teams and other teams) with a stated goal of turning Tennessee into a Top 25 university. That's great, provided that we account for a whole bunch of stuff that quite frankly I'm not really qualified to talk about and don't really belong in a college football blog (most of which revolve around affordability to Tennessee residents and allowing said residents to actually be admitted and if you can raise the top without raising the floor and here be spiders let's just move on). Previously, he spent 34 years on the academic side of the house at Florida and is certainly well regarded in that venue. Academics aren't in question here.

Now, let's talk money.

Here, let's start with the USA Today report of Tennessee athletics from 2007 to 2011. Now, let's add Tennessee's release on 2011-2012 finances. For those of you who don't want to click through, let's give you some numbers on department profitability:

  • 2008-2009: net of about -$3,200,000 income ($102.8MM income, $106.0MM expenses)
  • 2009-2010: net of about +$4,000,000 income ($115.7MM income, $111.7MM expenses)
  • 2010-2011: net of about +$7,000,000 income ($104.7MM income, $97.6MM expenses)
  • 2011-2012: net of about -$4,000,000 income ($106.5MM income, $110.5MM expenses)
I'm using those years as a reference since those are years Cheek was chancellor - although really, most of 2008-09 was set before he got here. You probably noticed a big drop off between 2009-10 and 2010-11 income; delve into the USA Today link and you'll find out most income sources stayed relatively constant - save the total removal of "School Funds" as a revenue source. That's categorized like this:

School Funds: Includes both direct and indirect support from the university, including state funds, tuition waivers, etc. as well as federal Work Study amounts for athletes. It also includes university-provided support such as administrative costs, facilities and grounds maintenance, security, risk management, utilities, depreciation, and debt service.
Although that level of detail isn't available through the UT link, based on the revenue sources described in that report I don't see anything that would qualify as School Funds according to that definition. I do see income sources that can be classified in the other sources under USA Today, though.

Great, so what does that mean? In essence, it means someone at the university decided to turn the athletic department into a totally self-funded institution. (This is true of a lot of major universities, for what it's worth. Interestingly, Alabama is increasing their school funding, even though they totally don't need to by profitability. Louisville had to subsidize their athletic department to turn a profit in 2010-11.) That in it of itself is fine, so long as the university athletic department turns a profit. But what if it doesn't, like this past year? Well, that's when you do things like dip into your cash reserve, which - in that report, at least - was in the $2 million range, or less than 2% of the operating budget. That's ...well, not ideal. (Here, compare it to other schools using Hart's words.) That's "we can't keep operating like this" territory.

The answer for now was - or is - to stop the outflow of money from the athletic department to academics for the next three years - $18 million over three years, or $6 million a year. (Technically, it was about $6.4 million last year.) That helps, at least if the athletic department was a stable institution. Great, so that's $6 million added back to the athletic department's bottom line, and - in theory - provided everything stays the same, that means the department won't have to dip into cash reserve.

Except there's this whole coaching search thing going on. Uh-oh.

So let's talk hopes and dreams. Ideally, when you're doing something like trying to hire the best man for the job, money isn't an object. You want that man who'll lead your team(s) to glory(ies)? Pay that man. Except in this case, you're on a budget made tight in no small part thanks to moves Jimmy Cheek made. If it comes down to money, that's the guy who makes the calls.

As a result, when you make moves on a budget, funny stuff happens. Derek Dooley - to an extent - happens. (Mike Hamilton, nice guy that he is, is also culpable for that move as well.) You then need to look at methods to reduce expenses - see the stopping outflow. When the driving factor behind a move is reducing potential expenses without looking at the potential income benefits (mind you, after stripping a rather substantial subsidizing), that's short sighted and a half. (A short aside: my line of work requires me to look at life cycle costing - that is, figuring out the long-term financial impact of a decision, not just the first cost of a solution. To compare: Nick Saban is a wise life-cycle costing decision. Butch Jones is a good first cost choice. Don't believe me? Go look at Alabama's ticket revenue growth in that USA Today link - up $13,000,000 in five years. Other revenue growth: also $13,000,000. That ain't all Anthony Grant.)

If there's been a plan to supplement this cutting of expenses by - even temporarily - shuttling money from the university back into the athletics program, I haven't seen any evidence of that. I'd love to be wrong about this; please, tell me if I'm wrong in the comments. I wasn't able to find anything.

And so, what we're left is an athletics program that has no cash reserve, no school funding (the only funding directly from the school right now comes via the student body), a bunch of buyouts, and - as of now - no head coach for its flagship program.

It comes back to money, doesn't it? That's on Cheek; if you want revenue growth in the athletics program, it needs good investments made into it. Let's use Alabama again - $36.9 million dollars in revenue growth since 2007-08 and three years of at least $9.5 million dollars in the black. Not too bad for a $5.5 million dollar head coach.

So make that investment. It's not like there aren't people who want to believe, and it's not like Tennessee is a bad job. But if money isn't there, then it certainly can be. Remove the money and everything falls down, and the quickest way to removing the money is by removing the fans. The fastest way to do that is to have them walk away. Nobody wants that.

This includes things beyond money, too; I'm always a bit loath to rage against academic requirements (other people are fine with this, but I bring this up because other people have, so it needs to be included), but if the academic requirements at other competitor schools are easier than Tennessee's, that'll affect the quality of athlete that's brought in. There's a balance to be sure - you don't want to be that school for one. Still, if a potential athlete is meeting SEC and NCAA requirements, is there more they need to do to be at Tennessee? If there is ..well, okay. But all decisions have consequences, and not all consequences are positive, and there may

And if there can be something done about the Thornton Athletics Student Life Center actually being controlled by the athletic department, that'd be awesome, too. I can deal with the increased expenses, since the net results should be positive. I know I'm asking for a lot here.

The easiest way to do help everyone out? Let Dave Hart be Dave Hart. He's certainly capable, but every hire isn't going to be Cuonzo Martin (and ...yeah, the man needs some scoring post-haste, but let's not digress); putting constraints on him to have to find the next Cuonzo every single time simply isn't going to work. Nobody's that lucky. There aren't that many diamonds in the rough. Give the man what he needs - and if he fails given the resources he needs to succeed, then so be it.

But I'm not convinced he'll be given that chance. Prove me wrong - heck, prove us wrong.

(And if you're reading this piece and Butch Jones is the Tennessee head coach, well, I guess we have our answer.)

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