There long has been a separation between the playing field and the classroom when it comes to revenue generated by college sports. But as many Division I college sports programs make more money from TV deals, apparel contracts and donors, the expectation an athletics department gets to keep all that cash is starting to change.
The University of Iowa Athletics Department, for example, last year joined a small group of collegiate athletics departments nationwide that funnel sports revenue to the academic missions of their host institutions.
Of 205 Division I college athletics programs, 40 reported giving money to their universities for academic purposes between 2011 and 2014, the Chronicle of Higher Education reported in 2016. But of those 40, only 10 programs gave more money to their schools than they received in subsidies from the universities, according to the article by Brad Wolverton and Sandhya Kambhampati.
Less than a dollar of each $100 major college sports programs generated from 2011 to 2014 went to academics, the Chronicle reported.
“Not very many do that,” said David Ridpath, an assistant sports administration professor at Ohio University and president of the Drake Group, a not-for-profit that advocates the overhaul of commercialized college sports. “The real simple answer is they choose to spend that money somewhere else.”
UI Athletics, for example, which brought in $113.2 million in 2016, spent $1.6 million on recruiting, $7 million on team travel, $17 million on facilities and $20 million on coaches’ salaries, benefits and bonuses, among other expenditures.
Included in this is more than $5 million that went to UI Head Football Coach Kirk Ferentz in fiscal 2017. The longest-serving head coach in the NCAA’s FBS — Football Bowl Subdivision — Ferentz made nearly three times as much as the next highest-paid Iowa coach, Head Men’s Basketball Coach Fran McCaffery, at $1.79 million.
Months after Bruce Harreld was hired as UI president in September 2015, he started talking about UI Athletics contributing financially to the university. In August, UI Athletics Director Gary Barta announced his department would give $4 million to the UI between the 2017 and 2018 budget years, which have been lean because of general fund budget cuts by the Iowa Legislature.
“The recent decision for athletics to provide additional support was made by President Bruce Harreld and myself,” Barta said in a Nov. 29 email to The Gazette. “It was a discussion that was driven, in large part, by the new television contract we entered into this year by the Big Ten. Virtually every Big Ten campus has decided to make similar investments.”
Four of the 10 athletics programs that gave money to their universities from 2011 to 2014 were in the Big Ten, four from the Southeastern Conference and two from the Big 12, the Chronicle reported.
Few programs share revenue
Ohio State University, University of Michigan and the University of Nebraska — Big Ten universities with traditionally strong football programs — regularly have channeled sports revenue to select academic programs or facilities.
Michigan announced last June an athletics budget surplus caused by higher conference distributions and licensing revenues from a new apparel provider, as well as a boost in “preferred seating donations,” would allow the department to give the university nearly $8 million in fiscal 2018. This was up significantly from $3.83 million the previous year.
“Very few schools can sustain [athletic] excellence over a sustained period of time...These schools are spending and spending, but what’s their end game?”
- David Ridpath
President, The Drake Group
The Nebraska Cornhuskers will give $5 million a year to scholarships for non-athletes starting in fall 2018, the school announced last August.
But not all Big Ten programs have wealth to share.
Although the new Big Ten media contract was expected to net $17 million for the University of Minnesota Athletics Department, the Golden Gophers are paying more than $7 million in transition costs to replace the football coaching staff after a sexual assault scandal, in addition to making bond payments on a $166 million basketball and football practice facility, reported Josh Verges of the Twin Cities Pioneer Press.
In fact, relatively few public university athletics departments actually take in more money than they spend.
USA Today reported 23 of 228 public schools in Division I were self-sufficient in 2016, according to the NCAA’s bench marks.
By NCAA standards, a program can say it’s self-supporting if its operating revenue is equal to total operating expenses, USA Today’s Steve Berkowitz and Christopher Schnaars reported.
Many programs get substantial student fees and indirect university support.
The University of Northern Iowa Athletics Department received about half its $17.7 million fiscal 2016 revenue, according to its NCAA report, from UNI or student fees.
Arms race blamed
The Iowa State University Athletics Department’s $78.4 million in revenue for fiscal 2016 surpassed expenses, but it also included $2.1 million in student fees.
“Student fees paid to athletics are less than 10 percent of total student fees and they are used to subsidize reduced-priced ticketing for students in preferred seating sections, such as lower bowl of Hilton (Coliseum), and to assist with funding of facility maintenance and enhancements that benefit the overall fan experience,” Steve Malchow, senior associate athletics director for communications wrote in an email to The Gazette.
ISU meets the NCAA’s definition of self-supporting, but the Cyclones aren’t in a position to start funneling sports revenue to academics, Malchow said.
“We just hired a new president, who is familiarizing herself with countless campus issues (including athletics), we just announced significant compensation bumps for our football staff and also shared a $75 million facility plan that we hope to move forward with in the next year,” he said.
“With all that considered, it’s not a real practical discussion for us at this time.”
The Iowa Board of Regents hired Wendy Wintersteen, longtime ISU agriculture dean, as president in October.
ISU is trying to build a program that can compete with Big 12 powerhouses of Texas and Oklahoma. But the Drake Group’s Ridpath thinks ISU and other Division I athletics departments would be better off sharing money with their host institutions.
“Very few schools can sustain excellence over a sustained period of time,” he said. “These schools are spending and spending, but what’s their end game?”
Plus, when college athletics departments share revenue with their academic hosts, it acknowledges the sports enterprise is built on the back of the university, Ridpath said.
“How valuable is Ohio State football if it isn’t attached to Ohio State?” he said. “Otherwise, it would just be the Columbus football club.”
The flip side, athletics administrators argue, is athletics can generate excitement among students and alumni, which can translate to increased enrollment and donations.
How money is used
As with most big donors, university athletics departments often get to decide how their money is spent.
Ohio State reported giving $36 million for academic use between 2011 and 2014, the Chronicle reported. This has included $1 million a year over nine years toward library renovations and a summer camp for 700 low-income children.
Nebraska has touted its Husker Scholars program as a way to keep the University of Nebraska-Lincoln “affordable and accessible.”
The UI Athletics Department wants to invest its money in diversity programming, student life initiatives and student recreational services, Barta said.
Lena Hill, UI interim chief diversity officer and associate vice president, said in an email her office is “in the midst of interesting conversations about the nature of our collaboration” with the athletics department, but that a dollar amount hasn’t been set.
“Their support for diversity, inclusion and equity work is important not only in terms of providing resources, but also for the message it sends our campus: We are committed to supporting a climate that encourages the success of all our students, faculty and staff,” Hill said.
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