Untitled Document

Sandy Barbour letter to Cal donor community

November 29, 2010

Dear Cal Bear Backers,

In the weeks since the announcement about plans for Cal Athletics' future, we have received a great deal of correspondence from our extended Cal community that runs the gamut from supportive, to inquisitive, to highly critical. What almost all of the letters and emails have in common is a request for additional information about how and why the painful decision to reduce the number of teams was made, and the extent to which all or part of the decision may be reversible. What they also share is a passion and concern for our programs-especially for our student-athletes. You have been there for us in good times and bad, and now, in the midst of a particularly difficult period, I know that we cannot-must not-take your continued support for granted.

After a careful review of all your letters and messages, it is evident that many of you were not aware of the FAQ we posted online after the announcement and/or had queries we did not fully address. For that reason, it is clear to me that we must provide you with more information on how the decisions were made, and we must address the lingering questions and concerns.

You will find a new, more comprehensive FAQ found by clicking here, regarding the decisions and their rationale. I am under no illusions that, after reviewing the information, criticism will magically vanish, but I believe you will find that our department faced an untenable, unsustainable financial future; that we did everything possible to avoid a reduction in our program's scope; and that the ultimate decisions were informed by values I hope we all share. I believe the FAQ will also shed additional light on the following essential elements of the decision-making process:

  • In recent years Cal Athletics' costs and revenues have been comparable to our peers in the Pac-10. The data will show that we have run a very lean operation on a per-student-athlete basis...so lean, in fact, that I believe we have been failing to provide our teams with all they need to fulfill their potential. While costs have increased in recent years, many were beyond our control, including a dramatic increase in scholarship costs due to rapidly rising student education fees. Our philanthropic, corporate, licensing and royalty revenues are also right in line with conference averages, and we fully intend to maintain their upward trajectory.
  • The Chancellor's determination that institutional support for Cal Athletics could not exceed $5 million annually by 2014 was made in the context of a campus that continues to confront a dramatic disinvestment by the state in higher education. Our students are paying more and borrowing more. More than 500 campus employees have been laid off. Vital maintenance has been deferred for much of the university's infrastructure. While the extent of funds the Chancellor can allocate at his discretion has diminished, the demand for resources has increased dramatically. Simply put, the campus is not immune to the financial forces impacting the nation and the state, and Cal Athletics could not claim to be an integrated and integral part of this university if it somehow remained untouched and unaffected by the university's predicament.
  • Once that $5 million target was established, we began a department-wide program of cost cutting-including layoffs and budget reductions-and pushed for even more aggressive fundraising goals. We reviewed and decided to implement just about every suggestion for offered by the Chancellor's Advisory Council on Intercollegiate Athletics. We factored in a reasonable estimate of incremental revenue resulting from a new Pac-12 media contract (scheduled for FY 13). Yet, when all was said and done, we still faced an anticipated $4 million gap (which will continue to grow over time) between the department's projected revenues and expenses.
  • There were only two options to close that gap: slash budgets across the board or reduce the scope of the program. Initially, we focused on the former and analyzed how, exactly, cuts totaling $4 million a year would impact every team and aspect of our program. Suffice it to say it that option left each program in a non-competitive position, including our revenue sports. Every team would have lost some scholarship positions; some would have been required to rely solely on walk-ons. Already strained resources in sports medicine, strength training and academic support would have been further diminished. In sum, we would have harmed the teams that provide essential revenue to support the rest of the program, while crippling the competitive abilities of every Olympic sport. One can only imagine how our community would have responded if we had chosen this path.
  • Since November 2009, I have consistently, continuously and publicly stated that our financial situation necessitated dramatic changes and that every option was on the table. The message was clear: the status quo was unsustainable and the overall program was facing the possibility of significant change. In last few months before the decision was reached, we did consider a more direct outreach to donors affiliated with the teams that might be endangered if we were forced to reduce the scope of the program. However, because campus leadership determined that our financial model must be sustainable in perpetuity in order to preclude another similar crisis somewhere down the road, the only solution would have been-and remains-a very dramatic increase in our endowment sufficient to guarantee funds necessary to meet the Chancellor's target. We believed, and continue to believe, that expecting a quantum leap in philanthropy in order to rescue sports from being cut would be unrealistic and unfair to our donors who are already supporting the non-negotiable need to modernize Memorial Stadium, as per the Regents' mandate. Having said that, we are aware of the interest many of you have in the possible reinstatement of impacted teams and have included detailed information on this subject in the FAQ.

In essence, we were caught between a rock and a very, very hard place. The decision regarding which of our teams would cease to be part of the program was the single most difficult endeavor any of us had ever been involved in. We had no "favorites." We had no ability to delay, defer or deny. We knew there would be an outcry no matter what the actual mix would look like. I accept full responsibility for a decision that, in my opinion, represented the best option among a very distasteful set of options.

I also want to say a few words about the Endowment Seating Program. When it was launched, we had no way of knowing what was lurking around the corner for the country's economy, or the state's and campus's finances. We fully expected that this innovative approach to funding the stadium's construction costs would generate an endowment sufficient to support all 29 sports that we currently field, and we are heartbroken that the program's intentions will, in all likelihood, not be fully realized. But the fact is that ESP's importance has only increased in the wake of the recent decisions. Although we will soon be back on a financially sustainable path, I know that we all share aspirations for Cal Athletics that go well beyond "sustainable." We all want the level of excellence that UC Berkeley stands for, and the Endowment Seating Program remains our best hope to realize our shared desires.

I ask that you take the time to carefully read and review our new FAQ linked above. For those who want a great deal of additional, detailed information we have posted our original FAQ on this web site. The site also contains source documents and financial data we used in our analysis, and were recently provided to individuals who asked to review these records. If questions remain, please let us know, for I fully realize that we cannot return our focus to the future until the salient issues have been fully addressed.

One definition of a crisis is that there are no easy or intuitive solutions, and for that reason every potential solution is inherently controversial. However, if we are a community in the true sense of the word, we cannot allow disagreement to overwhelm or overshadow what brought us together in the first place. I continue to come to work every day dedicated to one, over-arching goal: providing our student athletes with what they need to excel on and off the field.

Sandy Barbour
Director of Athletics