New Jersey governor Phil Murphy was vocal about his concerns regarding the Rutgers athletic department's financial woes.
Deferring any formal action, Murphy said that what he’d read about the Big Ten program’s current state of affairs “takes your breath away.”
NorthJersey.com reported that more than $430 million in loans and other support has been invested in Rutgers’ athletic division since it began playing in the Big Ten. Rutgers president Jonathan Holloway called the school’s $265 million in outstanding debt “unsustainable.”
“If you’re asking me how I reacted to President Holloway’s — I think he said it’s not sustainable — I would certainly agree with that based on what I know,” the Murphy said. “Quite, quite concerning based on what I read.”
Rutgers also reportedly recorded loans from the university as generated revenue for the athletics department, a violation of NCAA guidelines. Fully $48 million in loans from the Big Ten were also recorded as revenue.
The faulty reporting concealed the athletic department’s actual annual deficits. The university reported a shortfall of $10.6 million to the NCAA in 2019-20, but the actual amount was $73 million.
To make matters worse, Rutgers did not have a copy of its contract with the Big Ten, something Flavio Komuves, the faculty union attorney, said is unbelievable.
I would expect a sophisticated enterprise like Rutgers to maintain better records,” Komuves said of the loan agreements. He added that he believes it is “completely outrageous” for the university not to have a copy of its contract with the Big Ten.
“These are monies coming into public coffers,” he said. “If you don't even have the contract how do you even know what you're entitled to? I mean, what, somebody remembers?”
According to NorthJersey.com, the athletics division debt includes $70 million in loans taken to fund Rutgers’ two newest buildings — the RWJBarnabas Athletic Performance Center and the Rodkin Academic Success Center. The two projects cost a combined $150 million, with a third covered by donations and another $23 million by state tax credits.