The Augusta Civic Center is one of the sites for the 2022 Maine high school basketball tournament, which starts later this week. Last year’s tournament was canceled because of the coronavirus pandemic. Joe Phelan/Kennebec Journal

The agency that oversees high school sports in Maine took a significant financial hit last year because of the coronavirus pandemic and hopes the return of the high school basketball tournament will help shore up its finances.

By the end of the week, the tournament will get underway at arenas in Portland, Augusta and Bangor. The event has been the highlight of Maine’s high school sports calendar for decades, with many fans driving hours to see their teams in action. Last winter the tournament was canceled in response to the pandemic.

The annual basketball tournament is the economic engine that drives the nonprofit Maine Principals’ Association. A bad weather day or two that impacts travel can put a dent in ticket sales that the agency feels the rest of the year, according to Mike Burnham, executive director of the MPA’s Interscholastic Division.

Poor attendance at the tournament has a ripple effect. Without sufficient income from the event, the MPA would struggle to fund championships in a number of sports that generate a fraction of its revenue, such as swimming, skiing, wrestling, and indoor track and field, Burnham said. The agency already had seen a steady decline in revenue from its postseason events for several years before the pandemic hit.

The MPA suffered a $237,180 loss for the fiscal year of July 1, 2020, to June 30, 2021, according to its latest federal tax filing. Its revenue from postseason events plunged from $1.5 million in 2019-20 to $375,696 in 2020-21. The MPA ended the fiscal year with assets of $861,000, lower than in any of the four preceding years.

The lack of a basketball tournament was the chief reason for the losses – making a 2022 tournament with robust attendance so critical not only for the MPA’s ledger, but for many other high school championships as well. The principals’ association hosts nearly 20 tournaments and/or state championships during a typical school year, many of them largely fueled by revenue from the basketball tournament.

Postseason tournaments account for approximately 80 percent of the organization’s revenue, Burnham said. The basketball tournament accounts for half of that, typically bringing in $700,000 to $750,000 in annual revenue. After expenses for renting arenas and putting on the tournament, that nets just over $300,000 in a typical year.

Because of the pandemic, the MPA held championships only during the spring season in 2020-21, along with golf in the fall. In the spring of 2020, the entire high school sports season was shut down after the pandemic hit.

“We went an entire year without revenue, but it was broken into two fiscal years. We had the basketball tournament in ’19-’20. That was our last tournament,” Burnham said. “That year we were OK, even losing the spring, because we had brought in half our revenue through basketball. Last year, not having the fall or winter, that’s where you saw the significant loss.”

While last year’s drop in revenue was dramatic, the MPA’s income from gate receipts and merchandising at postseason events declined by nearly 25 percent in the five years from 2015-16 to 2019-20.

“It seems like we’ve been concerned about declining attendance at tournaments for a while, now – especially here in the southern part of the state,” said Andrew Dolloff, Yarmouth’s superintendent of schools. “The pandemic certainly hasn’t helped, but I’m hopeful that when this health crisis is over, and everyone feels safe to gather in public again, there will be renewed energy around community activities like high school tournaments.”

John Suttie, the superintendent of RSU 23 and principal at Old Orchard Beach High School, agreed that the steady drop in tournament revenue is troubling. But he expects to see big crowds at basketball tournament sites this winter after a year away.

“There’s no way to recoup what was lost. Businesses across the country, nonprofit and profit, felt that. I think the crowds this year will come back,” Suttie said. “I really feel like we’re at a place where we’re developing a lot of good future college basketball players on the boys and girls side. I think people want to get out and see some great basketball.”

This year’s high school basketball tournament begins this week with preliminary games and Class AA quarterfinals at high school gyms before all games move to larger arenas on Friday. State championship games are set for the weekend of March 4-5. The Class B state games will be March 4 at Cross Insurance Center in Bangor. On March 5, the Class A and AA championships will be held at Cross Insurance Arena in Portland, while the Class C and D championships will be held the same day at the Augusta Civic Center.

As the omicron variant fueled a spike in COVID-19 cases across the state this winter, there was concern the basketball tournament might be played without fans in the stands – or perhaps even canceled again. Watching how athletic directors across the state managed and juggled their schedules to ensure the regular season was completed provided a hopeful sign for Burnham and his colleagues.

Mike Burnham is executive director of the Maine Principals’ Association’s Interscholastic Division. “We’re cautiously optimistic that as long as the weather cooperates and we can continue to move in the right direction, we will have tournaments like we’ve had in the past, and the revenue that comes with them,” he says. Andy Molloy/Kennebec Journal

“It’s one of those things that’s always there, that you’re always worried about it taking a turn and not being able to hold these events and have the tournaments. It would be remiss if we didn’t acknowledge that’s been a concern,” Burnham said. “At the same time, recognizing the job schools across the whole state have done with this with the regular season. Having to cancel games and reschedule games, dealing with shutdowns, everybody deserves a huge thank you for their effort.”

Stripped of an important revenue stream during the pandemic, the principals’ association did what many nonprofits and businesses did to survive. Two Payroll Protection Plan loans from the federal Small Business Administration helped to subsidize salaries for the MPA’s staff of six employees. The first, for $91,783, was received in April 2020. A second loan of $92,772 was received in February 2021.

Burnham said no one in his organization has received a raise since the pandemic began. Burnham’s salary for the 2020-21 fiscal year was $114,132. Holly Couturier, the executive director for MPA’s professional division, was paid $103,453.  With professional conferences canceled or postponed, travel budgets were cut.

The MPA also took out a line of credit of $125,000, Burnham said.

“We thought taking out a line of credit made more fiscal sense than taking the money out of the investments that were available,” said Burnham, whose organization also provides professional development opportunities for secondary educators across the state.

The MPA was not alone in its financial predicament. According to the National Federation of State High School Association (NFHS), Maine is one of nine states that did not hold a sanctioned high school basketball tournament in 2021, along with Nevada, which canceled its entire season, Connecticut, Illinois, Hawaii, Maryland, Massachusetts, New Jersey and New York.

Tara Bennett of the Massachusetts Interscholastic Athletic Association estimated a loss of approximately $300,000 for her organization. John Holt of the Connecticut Interscholastic Athletic Conference declined to say how much revenue was lost, but 2022 will be the first time in two years the state will be able to hold basketball state championships.

“We did not have boys and girls basketball state tournaments in 2021 and they were cut short in 2020. So, in 2022 we’ll be crowning state basketball champions for the first time since 2019,” Holt said.

Even states that held tournaments in 2021 saw a financial pinch. Vermont, for example, held a basketball tournament without fans. The Vermont Principals’ Association saw a decrease in revenue of approximately $150,000, according to Bob Johnson, the group’s associate executive director. That was offset by a decrease in expenses of approximately $45,000, for an overall decrease of $105,000 from a typical basketball tournament, Johnson said.

Along with its counterparts in New Hampshire and Vermont, the MPA has worked with TPG Marketing to increase sponsorships. As important as those sponsors are, Burnham said, they bring in approximately $100,000, a fraction of what the principals’ association brings in via ticket sales. A streaming contract with WHOU, a Houlton-based radio station that broadcasts basketball regional semifinal and final games on its website, as well as a contract with Maine PBS to broadcast state championship games, brings in added revenue. The NFHS divides revenue from its streaming service among the members, Maine included.

Holding a basketball tournament is important to the MPA’s income, but it hasn’t been a guarantee of finishing the year in the black. While the 2020-21 fiscal year’s losses were the largest in some time, they weren’t an outlier. In 2018-19, the principals’ association lost $160,746. The previous year, it lost $90,819.

Caribou High basketball fans traveled 300 miles to watch the Vikings win the Class B boys’ state championship in Portland in 2018. Carl D. Walsh/Staff Photographer

“If we have inclement weather during our championships, that takes a significant toll on the attendance. When you’re depending on 80 percent of your income to be attendance connected to ticket sales, it doesn’t take long for that to be a hit,” Burnham said. “Certainly if you get a good matchup, it’s going to bring in a nice crowd, but not always. That’s just the way that it falls.”

The MPA’s revenue from high school tournaments has declined each year since 2015-16, when it was $1,998,381. By 2019-20, it was down almost 25 percent to $1,501,316. Burnham looks at the declining number of high schoolers in the state overall as a big reason why.

“If there are fewer kids participating, there are fewer parents, families and fans that may be attending the events,” Burnham said.

Burnham is hopeful there are large crowds, not just for basketball, but for the other tournaments and championships coming up this winter.

“Since we came back last spring after having a year off, we saw some of the largest crowds we’ve ever seen. The people were so happy to be back to support these kids,” Burnham said. “We’re cautiously optimistic that as long as the weather cooperates and we can continue to move in the right direction, we will have tournaments like we’ve had in the past, and the revenue that comes with them.”