Colleges Foot a Large Share of Athletics Expenses, New NCAA Data Show
By ERIC KELDERMAN, The Chronicle of Higher Education
For the first time, the National Collegiate Athletic Association has revealed the growing amount of financial support that colleges provide to their sports programs, using detailed accounting to separate institutional funds from money earned through ticket sales and private donations.
A March report from the NCAA concludes what many have long feared about the real costs of college sports: The vast majority of athletics departments operate in the red.
While athletics expenses had a median growth rate of 23 percent for the top tier of Division I programs between 2004 and 2006, revenues saw a median growth rate of 16 percent. And while the figures varied somewhat, spending on sports also outpaced income from those activities in the lower two categories in Division I, which either are not eligible for bowl games or have no football programs.
As a result, just 17 of the more than 300 athletics programs in all of Division I—about 5 percent—earned a net profit between 2004 and 2006, with ticket sales and private donations accounting for more than half of all revenue.
Sixteen of those profitable sports programs—a number that may exceed some expectations—were from the elite Division I-A, or what is now called the Football Bowl Subdivision, where the median amount of college support was 24 percent of the costs of sports programs. The one other sports program that turned a profit during the period came from the lowest subcategory of Division I, where the median institutional support accounted for 70 percent of sports costs, including paying for maintaining facilities or providing academic support for athletes.
In contrast with previous NCAA information on the budgets of athletics departments, the new report distinguishes between "generated" revenue, earned directly by athletics activities, and "allocated" revenue, the direct or indirect support that universities give to sports programs. The figures were compiled using responses from all but three of the 330 universities that participate in Division I. Figures for individual institutions are not included in the report.
Daniel L. Fulks, a professor of accounting at Transylvania University in Lexington, Ky., and the faculty athletics representative there, assembled the data for the NCAA. He said the changes in reporting the information give a clearer picture of how much institutions are actually underwriting their sports costs.
"With allocated revenues, it's always been my sense that we're taking money out of one pocket and putting it in another," he said.
The good news for athletics programs is that their share of the university's overall budget has remained relatively constant at about 5 percent, meaning that the amount of spending in other areas of higher education is growing just as quickly as the cost of sports, Mr. Fulks said.
But the escalating costs of staff salaries and scholarships are driven by an "arms race" to attract the best players, he said. "It's all about recruiting."
Salaries for coaches and support staff are the largest and fastest-growing expense in all Division I sports programs. In Division I-A, the median salary for head football coaches grew by 47 percent between 2004 and 2006, rising to $855,500 from $582,000, while the median salary for men's basketball coaches rose 15 percent, to $611,900.
Salaries and scholarships together account for half of the total expenses for Division I-A sports and more than 60 percent of the expenses in the two lower categories.
Todd A. Diacon, vice provost for academic operations and the faculty athletics representative at the University of Tennessee at Knoxville, said the rationale behind the big spending increases was "if you field a team, you ought to compete to win." And that spirit has increased the pressure to spend heavily even on sports that earn the least amount of revenue, Mr. Diacon said.
For example, the median amount of revenue generated by Division I-A men's track and field teams in 2006 was $33,300, while median expenses were $584,500—17 times higher, according to the NCAA data. For women's track and field, the median for generated revenue in 2006 was $24,600, compared with median expenses of $761,000—more than 30 times higher.
In addition to the skyrocketing salaries for coaches, Mr. Diacon said, the latest trend is to build state-of-the-art facilities for sports that have no chance of recouping the costs of those structures. At the Knoxville campus, that has included construction of a new women's softball stadium, a new soccer stadium, and an indoor swimming pool.
"Even if we win the NCAA championship in swimming," Mr. Diacon said, "that's not going to pay for the pool." Over the next two years, the athletics department is planning new facilities for golf, volleyball, and indoor track, he said.
Although private donors may help to pay for those facilities, universities must often borrow money to complete the projects and also often pay for the continuing maintenance or the cost of utilities. The actual construction costs for athletics facilities are not included in the latest NCAA report.
Darin Spease, president of the College Athletic Business Management Association, said the pressure to lure the best players has escalated the competition even in the lowest category of Division I, where there is no football revenue to make up for the losses in other sports.
"As long as there is an elite group of schools with generous alums, I don't see that it ends," said Mr. Spease, a senior associate athletic director at the University of North Carolina at Charlotte. "I don't know how rank-and-file schools compete."
Why ASU cut 3 sports: Money
Date: 5/15/2008 6:40 AM
a CLIPS GUEST COMMENTARY
Arizona State is the latest program to fall to the budget ax and Title IX; the casualties are men'stennis, wrestling and swimming.
By Paola Boivin
In three years as head of the Arizona State University athleticdepartment, Lisa Love hired men to coach three women's sports teams.She reports to a man and entrusts a man to represent her department asthe chief spokesperson.
On Tuesday, however, Love announced that three men's sports programswill be discontinued. After that tough and unpopular decision, somesuggested Love must hate men.
Be sad about the demise of three ASU sports, but don't let your frustration cloud your thinking.
The decision to cut wrestling, men's swimming and men's tennis isn'tabout misandry. It's about economics and abiding by the law. Nothingmore.
The state is contending with a $1.2 billion budget deficit. The ArizonaBoard of Regents recently approved $26 million in cuts for the currentschool year. These two headlines have appeared in The Republic in thepast 12 days: "Ariz. economic report weak" and "State may lose 12,500jobs in '08."
Your gas is higher, your co-worker was laid off and your wrestling team has been eliminated.
It stinks.
"No, this was not some personal decision made inside the athleticdepartment to discontinue men's sports," said Love, ASU's vicepresident of athletics.
The economics came first. Then, the law stepped in.
When ASU determined cuts were necessary, Love had to make a decisionthat would keep the athletic department within the parameters of TitleIX, the statute created to prohibit sex discrimination in educationprograms that receive federal financial assistance. It was laterapplied to high-school and college athletics.
Love's decision to cut three men's sports, leaving eight male sportsprograms at ASU compared with 12 for women, has prompted cries ofreverse discrimination.
Understand this: It's not about team equity. It's about scholarshipequity. It's the 85 scholarships that go to football that tip thescales.
During the 2006-07 academic year, ASU had 311 male athletes and 222female athletes, according to figures from the U.S. Department ofEducation. Although the figure includes walk-ons, it's a good measureof distribution. It's hardly lopsided in the women's favor.
Last year, ASU had 44 wrestlers, 24 male swimmers and 10 male tennisplayers. That's 78 athletes, a total similar to this year, and removingthem still leaves more male participation overall.
Why wrestling, swimming and tennis? Simply, they were most expendable.
Although ASU was a national champion in wrestling in the 1980s, thesport doesn't have the cachet in the West it used to have. Thatexplains why only two Pac-10 schools still have the sport. Meets thesedays attract only a few hundred people. Swimming and tennis? Usually ahandful.
The Sun Devils will save $1.1 million without these sports next year.
On the other hand, some sports, such as golf, are much closer to beingself-sustaining. Golf has a strong fundraising program, and alums whohave gone on to the professional tours often have given back.
"I don't know if I can begin to express the words of how tough thisdecision was," Love said. "But the reality of our fiscal profile isthat we can't continue to support a 22-sport department."
The biggest losers are the athletes who came to ASU to compete in thesesports and the coaches who thought they would have jobs beyond thisseason. No matter how logical the explanation is, they are stillvictims.
And that's a shame.
The college-sports scene is heading in a scary direction. Football andbasketball head coaches are attracting contracts worth millions, yetOlympic sports programs with operating budgets of $120,000 can'tsurvive. You need to pay big bucks to stay competitive yet are leftwith a world of haves and have-nots. It's a caste system gone awry.
If you want to get mad at Love for anything, be mad at her forextending former football coach Dirk Koetter's contract and then firinghim, requiring a buyout. Some of that money did come from privatesources, but still, it didn't help perception.
Just don't be mad for the wrong reasons.
