Michigan Wolverines athletic department faces staggering budget deficit due to COVID-19 pandemic

By Matt Johnson
Nov 30, 2019; Ann Arbor, MI, USA; Michigan Wolverines head coach Jim Harbaugh during the first quarter against the Ohio State Buckeyes at Michigan Stadium. Mandatory Credit: Tim Fuller-USA TODAY Sports

The COVID-19 pandemic has brought collegiate sports to a halt and forced campuses to close down for months. Even as many remain hopeful for a college football season this fall, the University of Michigan is now bracing for a staggering budgetary deficit this year.

Michigan athletic department projects $26.1 million deficit from pandemic

Ever since collegiate sports were canceled in mid-March with millions of students sent home, colleges have been dealing with a staggering hit to their revenue. From the cancelation of March Madness to a loss of stadium revenue, athletic departments across the country have been hit especially hard.

Now, with UConn becoming the latest school to eliminate multiple athletic programs to save money, Michigan athletic director Warde Manuel is projecting a dire situation for the Wolverines.

The University of Michigan, one of the most recognized schools in the United States and a powerhouse in athletics, estimates a $26.1 million budget deficit for the 2020-’21 academic year.

A steep decline in stadium attendance is projected to play a substantial role in the financial hit. As Manuel described to The Detroit News, the Wolverines anticipate a $29.2 million decrease in spectator admissions and a preferred seat contributions decrease of $17 million.

It could become an even more devastating hit for Michigan if football season is canceled. Before the pandemic hit, the athletic department projected the football program would make $49.5 million this year from spectator revenue and preferred seat contributions would generate $28.3 million.

How will COVID-19 impact attendance for Michigan Stadium?

Even if there is a football season this fall, it won’t be under normal conditions. While the University of Tennessee still thinks it will have full stadiums, Manuel already made it clear that won’t happen at Michigan Stadium.

“We won’t have 110,000 people in Michigan Stadium this year,” Manuel said, via The Detroit News. “Will it be 50% or 30% or 20% or 10 or zero? I’m not sure. That will be a combination of listening to our public health officials knowing what our stadium capacity can handle given the direction that is put out by the Governor’s office. It all depends.”

Michigan does have money saved in its reserves, Manuel said, and the school is working on a debt-service plan to help work through the deficit. The Wolverines will still need to make budgetary cuts to their athletic department.

If spikes in positive cases for the coronavirus continue and schools don’t feel it’s safe for student-athletes to play, Michigan will face even more difficult decisions in the coming months.