LSU’s athletic budget to rise — along with some ticket costs

A decade ago, as the 2002-03 fiscal year drew to a close, LSU’s athletic department budget came in at approximately $41.25 million.

That figure is not even half of what LSU projects it will cost to fund its athletic programs in the coming fiscal year.

Athletic department officials say they will begin the 2013-14 fiscal year Monday with a budget projected to top $100 million for the first time at about $101 million, an increase of roughly $5 million from the $96.2 million budget for the fiscal year that ends Sunday.

With expenses continuing to rise, LSU Athletic Director Joe Alleva said the school likely will have to increase the cost of football and baseball tickets for the 2014 seasons.

The last time LSU raised football ticket prices was in 2010. Ticket prices for baseball have remained the same since the new Alex Box Stadium opened in 2009. Alleva said LSU likely will hold the line on men’s and women’s basketball ticket prices as the school tries to continue to revive fan interest in those sports.

The ticket price increase plan is incomplete, but Alleva said it will have several components to it. He said ticket prices as well as Tradition Fund fees — an annual surcharge paid to LSU’s Tiger Athletic Foundation for the right to purchase season tickets for football, men’s basketball and baseball — will increase for more choice seats in the lower bowl of Tiger Stadium.

Conversely, Alleva said LSU plans to eliminate Tradition Fund fees for season tickets in Tiger Stadium’s east and west upper decks, as well as for outfield bleacher seats at Alex Box Stadium.

Alleva added that, once the south end zone construction project is completed for the 2014 season, LSU will move most of the ticket block for visiting teams to the new south upper deck. This will open up several thousand seats in the southeast corner of Tiger Stadium’s lower bowl for new season-ticket holders. Under Southeastern Conference rules, LSU will have to keep about 2,500 seats in the lower bowl for visiting teams, Alleva said, including a visiting school’s band if they bring one.

The major reasons for the ticket price increases are to offset skyrocketing tuition, salary and employee benefit costs, Alleva said.

The athletic department must reimburse the university’s academic side for each scholarship it hands out — even paying the higher, out-of-state rate for non-Louisiana student-athletes. Alleva said tuition costs have been rising about 10 percent per year the past several years.

In addition to ever-rising coach and employee salaries, Alleva said the fringe benefit rate has gone up from about 22 percent five years ago to 39 percent for the 2013-14 fiscal year.

“If someone makes $100,000, we had to pay an additional $22,000 to the university for sick leave, vacation, holidays and their pension,” Alleva said. “Now that rate is going up to 39 percent.”

Mark Ewing, the athletic department’s chief financial officer, said LSU’s annual benefits cost has risen $2.6 million since the last football ticket increase in 2010, and scholarship costs have risen $2.3 million. That’s in addition to expanding lines in the budget such as higher salaries and higher game guarantees for nonconference opponents.

The athletic department also donates $7.2 million per year to the university’s academic side as part of the LSU Athletics Fund Transfer Policy, plus it pays out a percentage of any surplus at the end of a fiscal year. In 2012, the athletic department forked over about $4 million in surplus money, Alleva said.

Rising costs have cut into the surplus to the point that Ewing estimates the athletic department will only clear about $3 million to $4 million once all the bills are paid for 2012-13, not counting whatever percentage of the surplus goes to the university. Alleva said that amount is to be determined.

Alleva and Ewing said the athletic department, which receives no state funding or mandatory student fees, needs to have a reserve for coaches’ buyouts, recovery from major storms or to fund one-time recurring projects like resurfacing Bernie Moore Track Stadium or waterproofing Tiger Stadium.

Alleva is hopeful projections of increased revenue from the SEC’s new TV network (scheduled to go live in 2014) and the new College Football Playoff (which begins after the 2014 regular season) will make ticket-price increases smaller or less likely in future years.

Some sports media analysts have projected revenues from the SEC to its 14 member schools could eventually increase by about $14 million per year per school. SEC member schools each received $20.7 million for the 2012-13 fiscal year.

“If revenue comes in as it should, my goal is we won’t have to go up on ticket prices significantly in the future,” Alleva said. “But we need to go up (in 2014) now.”