THOMPSON: IMMEDIATE ACTION NEEDED TO STOP MISMANAGEMENT OF RUTGERS ATHLETIC FUNDS

ADMINISTRATION NEEDS TO STEP-IN AND TAKE ACTION ON QUESTIONABLE SPENDING BY RUTGERS ATHLETIC DEPT. 

Assemblyman Sam Thompson today said that Rutgers University President Richard McCormick, the Board of Governors, and possibly Governor Jon Corzine need to take immediate action to void as soon as possible Rutgers’ contract with the Nelligan Sports Marketing firm and the use of the revenue generated from this contract as a slush fund by the University’s athletic department.

A story in today’s Star-Ledger reported that a confidential internal audit of the Rutgers Athletic Department issued in February revealed that the Nelligan contract generated $2.3 million in advertising sales during the 2006-2007 season which yielded a final payment of only $413,000 to the school.  It was reported Nelligan deducted $1.5 million from the gross revenue for expenses for unspecified travel expenses, telephone bills, salaries and benefits, production costs and $138,000 in miscellaneous costs and finally, Nelligan took 36% of the balance as part of its partnership with Rutgers.

“I find it outrageous and totally unacceptable that the bottom line payment to the University would amount to less than 18% of the advertising revenue generated even after recognizing that some of the “expenses” were attributable to the athletics department use of these monies as a slush fund, i.e., the department would direct Nelligan to pay certain expenses and deduct the payments from the money due to the University,” said Thompson, R-Middlesex and Monmouth.

In previous news stories, T.J. Nelligan, head of the sports marketing firm, seemed puzzled by the controversy surrounding the use of these revenues as they were privately generated rather than taxpayer monies.

Thompson said that what Mr. Nelligan failed to recognize is that these are University generated revenues just as are the ticket sales revenues produced by the sporting events he is marketing or for that matter, student’s fees and tuition and should be subject to the same degree of accountability both with regard to their receipt and expenditure.

As a result of previous negative publicity, several additional external and internal audits of the athletic department and a review of the Nelligan contract have already been announced.  However, in light of this latest information, it is imperative that the University initiate actions to correct the obvious accountability problems immediately within the athletic department and the Nelligan contract.

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