A letter from President Michael Gottfredson to University faculty announced that Provost Jim Bean will be resigning from his position as senior academic administrator to return as a faculty member in the Lundquist College of Business.

Bean served the University for the past four years, but was on sabbatical for the past academic year in which former Vice President Lorraine Davis served as his interim. He returned for the beginning of President Gottfredson’s tenure to help with the transition of the University’s leader in what was a rocky year for the administration with the firing of former President Richard Lariviere.

“There are many additional contributions to the UO that Jim has made as provost and I look forward to the opportunity to celebrate those with you in the coming months,” President Gottfredson said in his letter. “I am also personally very grateful for his guidance, counsel and leadership during my first months here.”

The University will hold a national search for Bean’s permanent replacement while Gottfredson and other campus leaders elect an interim to take effect July 1.

The athletic department concluded its final intercollegiate competition in McArthur Court on Jan. 8, 2011, but the decrepit building squished between Esslinger Hall and Howe Field isn’t just an empty space waiting to be razed — there are still students, staff and faculty who make use of it.

According to the Memorandum of Understanding between the University and the athletic department (PDF), use of the old arena is split between University of Oregon Physical Education and Recreation, Club Sports, intercollegiate softball and men’s and women’s tennis teams.

Despite split use, the UO programs using the building were asked to pay the brunt of the utilities cost. The MOU states athletics only takes up 17.84 percent of the building. In 2010, the total utilities cost for Mac Court was $121,760, equating to $21,000 for the athletic department. The document outlines readjustment of cost sharing based on the current year’s consumer price index, but the Emerald was unable to obtain the renewed agreement.

Constructed in 1926, the 87-year-old building has seen its fair share of thrilling competition and was widely recognized as one of the most hostile environments in college basketball. It was home to many great players, including the first NCAA men’s tournament champions in 1939, the “Tall Firs,” as well as current NBA players Aaron Brooks and Luke Ridnour.

Now the building is dedicated to PE and recreational use, including the men’s and women’s club volleyball and rowing teams. It has also provided an extra space for students who want to pursue their own athletic endeavors at the UO.

Associate director of facilities for physical education, Bryan Haunert, says that having the extra space for PE classes and intramural sports is important to the students who use the space and frees up room in the Student Recreation Center.

“It does still have value to a student to walk in, and they’re actually having class in Mac Court, which obviously has a huge history on campus,” Haunert said. “I think it’s a neat atmosphere and venue to still keep active.”

Senior club volleyball player and head coordinator Katelyn Comfort says that before getting to use Mac Court, the volleyball teams had to fight for practice space in the basement of Gerlinger Hall. She and her teammates are grateful they get to use the space three times a week because the old space was less than comfortable.

“The switch to Mac Court was magnificent. The space is massive and the floor is infinitely better,” Comfort said. “The best part about the integration of Mac Court as part of the Rec Center is that we only need to reserve the space each year, and we do not pay any rental fees through the great relationship between the Rec Center and Club Sports.”

The $200 million Matthew Knight Arena, perched on the farthest corner of campus and casting a sulky shadow on the shanty villages of Bean and Hamilton, is yet another marker of the chromium-plated athletic splurge of the past decade at the University of Oregon.

The UO men’s basketball program is showing a spark of promise that hasn’t been seen since the 1920s, starting their regular Pac-12 season 7-0.

Since that start, the Ducks stumbled to 10-3 in typical Oregon fashion — rallying back to defeat Washington and Washington State on the road after hard losses to Stanford, Cal and Colorado. But with all the hype around their exuberant start to the season, the main tenant of the nation’s most expensive college basketball arena still can’t pay even the majority of their bill. 

In its third year of operation, the arena is expected to return $7.7 million in operating revenue — just over $3.2 million short of what it was projected to gross when the athletic department originally drew up a funding model back in December of 2010. This funding model, known as the Oregon Athletics Legacy Fund, was funded in large part by Nike chairman and co-founder Phil Knight, as well as various other donors.

The athletic department published an updated Legacy Fund budget earlier this year. In this new budget projection, the athletic department had to make major readjustment’s to its revenue stream projections for the arena, yet again laying out the repayment plan to be finalized in 2027.

The new ticket revenue projections for men’s basketball show a $900,000 difference between what was originally forecasted in December 2010 and now — down from $3.7 million to $2.8 million, with over $5 million in operating expenses for the team.

Despite projection shortfalls, University administrators are not worried about the Legacy Fund drying up or the athletic department missing a payment. Jamie Moffitt, vice president for finance and administration, said that the administration’s regular discussions with the athletic department on key financial issues keeps athletics accountable to their debt.

“All arena fund debt has been fully paid, on schedule, as planned,” Moffitt said. “The Athletic Department is an auxiliary operation. Like other auxiliary operations, such as Housing and the EMU, it is responsible for paying for all of its operating costs with its projected revenue streams.”

The debt service on the arena — on top of its projected $3.1 million operating expenses — cost the athletic department $14.5 million last year, but it didn’t pay a dime out of pocket thanks to the Legacy Fund. This year, the athletic department will only use $12.5 million out of this allotted fund, with the other $2 million coming out of the department’s general fund.

“We have a longer term financial plan designed to reduce, on an annual basis, the amount of money we’re pulling from the Legacy Fund and taking more of the athletics operations revenue to pay for debt,” said Eric Roedl, athletic director for finance and administration. “In doing that, the Legacy Fund becomes more of a safety net as oppose to a funding source.”

But even with the men’s basketball program looking toward the NCAA tournament this March, the return on ticket sales’  revenue hasn’t been as good as originally projected when the Legacy Fund was first established.

“Attendance and revenue this year are pretty much flat,” Roedl said. “We’ve gotten a lot more aggressive with outbound ticket sales, and that’s a new initiative this year; so, it’s too early to tell what kind of an impact it’s having.”

According to documents showing the number of tickets sold for the 2012-13 season for games in Knight Arena up until Feb. 7, the athletic department sold 3,663 season tickets — neither a record for the arena nor the athletic department.

In the first four games of this season, there were only 986 single-game tickets sold. Over the same four games, there were 5,354 student tickets left unclaimed. Up until Feb. 7, there have only been three sell-outs for student tickets this season— Arizona, Arizona State and Washington.

The arena’s best day this year for all ticket types came on Jan. 26 during the Ducks’ first of two meetings with Washington when they managed to sell out the building, with attendance reaching 12,364. The arena has sold out three other times in its three-year history — all within its first year when the novelty of a new arena hadn’t wore off yet.

As the athletic department builds upon its recent run of success across all of its sports, the comparisons to traditionally affluent and large athletic programs continue. But in terms of balancing its big revenue programs, Oregon has some catching up to do with its self-proclaimed peers.

The Ducks’ expected $2.8 million revenue is only a third of what larger basketball programs average, such as Kentucky, which pulled in $6.5 million in revenue last year — but other even larger programs dwarf the UO: Duke, Louisville and North Carolina all grossed over $20 million during the 2009-10 season. In the Pac-12, Arizona’s basketball revenue sat at fourth in the nation, grossing $19.2 million with approximately equal the expenses Oregon will pay this year.

State officials at the Oregon University System are satisfied with the athletic department’s plan and commitment to repay the debt. OUS Vice Chancellor for Finance and Administration Jay Kenton says the only expectation is that the UO pay the annual debt service, not how they pay it.

“Our board has a policy on debt that we don’t want any one campus to have a debt ratio more than 7 percent,” Kenton said. “UO has 7 percent limitation and frankly are probably one of the highest in terms of being close to that threshold.”

He believes the UO’s current debt won’t affect how it asks for capital construction financing in the future unless it starts missing payments, an event he thinks is highly unlikely in this case.

“The only thing that would worry us is if they were unable to make that payment on that annual debt service, and everything I’ve seen to date indicates they are doing that and plan to continue to do that,” he said.