NCCU Athletics Must Tackle Budget Deficit Before Kicking Off New Season

DURHAM, NC – Before North Carolina Central faces Alabama State in the Orange Blossom Classic on Sept. 1, the athletics department must tackle a budget deficit first. The Charlotte Post reports that the NCCU Athletics Department has some major challenges to overcome.

At the last Board of Trustees meeting, Akua Matherson, NCCU’s chief finance officer and vice chancellor for administration and finance, reported that the athletics department is in the red—and we’re not talking pennies and nickels.

Cannot Break A 10-year Sponsorship Agreement

One of the culprits is a 10-year sponsorship deal between the department and Peak Sports, a multi-marketing company based in Texas, that was hatched in 2020 under a previous administration. The sponsorship looked good on paper: Peak Sports would manage and sell all sponsorship inventory for the department, from signage to digital content to sporting events. The Eagles would be guaranteed a specific amount.

However, as Skip Perkins, the athletic director since 2022, soon discovered, there was more to the story.

The partnership guarantees Peak Sports 40% of all the corporate sponsorships it sells for NCCU athletics and that NCCU sells on its own. So, Peak Sports gets a 40% cut whichever way the money flows in. And there are still seven years left on the contract.

“We have met with (legal) counsel multiple times to try to find a way to get out of this contract. The guy is not going to let us out,” Perkins said.

That guy is Peak Sports President Ryan Holloway. And let’s be honest, why would he? He’s in a win-win situation.

$500,000 Settlement with Duke Health

The second culprit is a $500,000 settlement with Duke Health.

Matherson said student-athletes have two types of insurance policies. One is a policy the athletes carry themselves, and the university carries a secondary policy on each student-athlete. A department employee is responsible for filing any necessary claims.

For several years – again under a previous administration – the person didn’t file the secondary insurance paperwork on the athletes, many of them from the defunct baseball program, which, may I remind you again, never won a MEAC championship but had the third-highest number of scholarships behind football and men’s basketball.

“The gentleman in charge of sports medicine at the time did not file the secondary insurance,” Perkins said. “It is paperwork, but I guess he thought that was not part of his job. He’s no longer here.”

Matherson said the half-million-dollar settlement with Duke Health was a gift because the total amount “was much higher.”

Coaching Spending Limits On Recruiting Trips

The third culprit is travel expenses. Coaches were given travel cards for recruiting, which was a bad idea. Not because they did anything wrong but because coaches have one-track minds: winning. They are not thinking, “Hmmm, am I getting close to my spending limit?”

“We had people continuing to charge without recognizing that there’s a budget,” Matherson said. “We pulled all that back and reinstated the AD and associate AD to manage the cards.”

NCCU, like most athletic departments in the red, is in a Catch-22 situation. On the one hand, the bleeding must stop, but on the other, teams must still win, or alumni will stop giving, creating a more profound budget deficit.

“The two biggest expenditures in athletics you cannot cut: scholarships and contractual obligations on coaching positions,” Matherson said. “A couple of (NCCU) contracts you’d have to buy out significantly to bring down what we’re spending.”

Departing NCCU Chancellor Johnson O. Akinleye was entirely complimentary of Perkins and his staff over the past two years.

“You’re cleaning up some things that occurred and put us in a hole,” Akinleye said. “Clean those items up and put us on the right side. In the last two years, the athletic program has been making progress, but digging out of a budget hole takes time and is a process.”

Photo: Lawrence Davis III

This article first appeared in The Charlotte Post.