Tennessee's athletic department is expecting a budget deficit between $2 million and $3 million this year.
That's a drop from $3.98 million a year ago according to a review at the university's board of trustees meeting Wednesday.
The athletic department cut its 2012-13 budget to $99 million from $105.9 million. But revenue is expected to be no more than $97 million.
University officials declined to comment until the after the fiscal year ends June 30.
Three consecutive losing seasons in football, and a decline in ticket sales and donations were cited for the revenue drop. Firing coach Derek Dooley last November cost a $5 million buyout, and new coach Butch Jones's contract is worth $18.2 million.
The 2011-12 deficit resulted in the athletic department's financial reserves dropping below $2 million.