The Ohio State athletic department is no longer relying on operating funds to repay the tens of millions of dollars due on the loan it received from the university to help cover revenue losses related to the coronavirus pandemic.
The change took effect this year and allows the department to use endowment returns for the remaining repayments, preserving almost $2 million annually in operating costs.
While the original terms of the $48 million internal loan included the endowment as a source for repayments, the department had been leaning on operating dollars to service the debt in recent years.
According to a ledger obtained by The Dispatch through a public records request, the department had made just over $4.78 million in total payments since 2023. The payments amounted to about $1.9 million each fiscal year.
The department last put operating funds toward a repayment of $956,461 in July before transitioning to using investment income from the university’s endowment this calendar year.
The relief comes amid a rapidly evolving period in the business of college sports in which athletic departments are dealing with new expenses. Since the settlement of three antitrust cases against the NCAA and major conferences was approved last year, schools have been permitted to pay players and award additional scholarships.
During this academic year, Ohio State is spending the maximum allowable amount of $20.5 million on direct payments to athletes in football, men’s basketball, women’s basketball and women’s volleyball and 91 new scholarships across a swath of sports. The revenue sharing limit, which increased by percentage points each year, will be $21.3 million in 2026-27.
Revenue sharing became one of the largest operating expenses for the athletic department, prompting it to explore options to gain more financial flexibility.
Buckeyes athletic director Ross Bjork said he began conversations with former president Ted Carter, as well as chief financial officer Michael Papadakis and members of the university’s board of trustees, about new loan repayment options more than a year ago.
“It was on the table before I got here,” said Bjork, who replaced Gene Smith in 2024, “but given the financial climate, looking at all the different expense line items, it was, ‘OK, can we have some flexibility and creativity around this particular line item in our budget?’ Two million dollars is a lot of money to be able to free up for other things in the department.”
The shift in the repayment plan was also owed to the structure of the loan, which was put in an account as part of the university’s endowment rather than provide direct cash assistance to the athletic department when it was first issued. The repayments went into the associated fund as well.
“The endowment can just grow on itself and eventually cover the $48 million that was taken out as a true loan,” Bjork said.
When the loan was finalized in late 2022, it was to be repaid over 30 years with an interest rate of 2.5%.
Ohio State saw its athletic department fall into a deep budget hole like many others during the height of the pandemic, which resulted in a shortened football season in 2020, a major disruption for the college sports industry. The reduced slate of games contributed to smaller shares of media rights distributions for schools, and the Big Ten’s prohibition on fan attendance for members wiped away tens of millions of dollars in ticket sales. In the year before the pandemic, the crowds at Ohio Stadium resulted in $56.6 million in ticket revenue.
The OSU athletic department would report an operating deficit of $63.6 million on its NCAA financial report for the 2021 fiscal year, a period that covered the pandemic-altered season for football.
Revenue has soared in the following years, resulting from a combination of factors that not only included the return of fans at games at the Horseshoe, but also the Big Ten’s multi-billion-dollar TV deal that took effect in 2023 and the College Football Playoff’s expansion in 2024.
It was during the most recent 2024 fiscal year that Ohio State’s athletic department surpassed $300 million in operating revenue for the first time, further helping with its rising expenses.
Joey Kaufman covers Ohio State football for The Columbus Dispatch. Email him at jkaufman@dispatch.com and follow him on @joeyrkaufman on X.