11/5/2011: Details in this Steve Duin column in the Oregonian, coming out in print Sunday:
The memo sets out the hoops the university jumps through to maintain the illusion (that athletics is self-supporting). The administration, for example, generously “allows” athletics to bank revenue from above-ground, off-street parking in designated lots during sporting events.
Yet the administration is required to pay athletics each year “for exclusive use of the presidential suite and 80 Club Level seats at Autzen Stadium for each home football event.” In the last three fiscal years, that cost the administration $375,000 annually.
The 3 percent assessment cap is buried at the bottom of the memo, and flies in the face of UO’s 2008 restructuring of assessment rates. As Laura Hubbard, associate VP for Budget & Finance, noted at the time, those changes were necessary to meet Oregon University System “guiding principles” in allowing indirect costs that are “reasonable, properly allocable, auditable and applied consistently across campus.”
The new rate schedule required auxiliaries — which include university housing and the health center (and athletics) — to pay overhead rates that escalate from 3 percent in 2009 to 7 percent in 2013. Less than a year later, however, Kilkenny and Frohnmayer signed off on a deal to cut athletics a break through 2012.
The secret agreement between then President Frohnmayer and Athletic Director Pat Kilkenny, signed two weeks before Frohnmayer retired, is here and is full of unusual things, amounting to several million dollars in subsidies for athletics. It was so secret even UO’s VP for Finance never saw it – or so she claims. And what did Kilkenny give Frohnmayer? About $500,000 for the Fanconi Foundation. It’s a very sad story on many dimensions.