Money pit or profit center? Small colleges flip script on athletic spending

On April 28, the University of Massachusetts faculty senate voted to recommend that the administration drop the football program from Division I FBS (85 scholarships) to Division I FCS (63 scholarships) or drop the program altogether. The move would come five years after the school transitioned to FBS in search of more revenue for the athletic department.

Earlier in the month, Eastern Michigan’s faculty senate made the same recommendation.

The UMass athletic department spent more than $28.5 million in subsidy money to fund the department, which came from a student fee and money from the university’s general fund.

EMU required more than $27.3 million in subsidy money.

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The universities with the largest subsidies. (USA Today)

For many, the costs of operating a Division I athletic department, especially with an expensive football program, are too high in the face of rising tuition and less public funding.

Many deplore the spending of university money on athletics when academic programs get reduced funding or cut altogether.

In their yearly report on NCAA Division I institutions’ athletic finances, USA Today found that only 12 institutions operated their athletic departments solely on their own revenues, which includes ticket sales, TV contracts and donations to the department.

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The highest revenue producing universities in 2015. (USA Today)

Some of those athletic departments even give money back to the university. Louisiana State reports an average $8.7 million dollar subsidy back to the cash-strapped university.

 

However, the rest need subsidy funding from the university in the form of student fees or monies from the university’s general fund.

The amount of money large, football-playing schools generate has even led for many to call to pay the players for the money that they are essentially responsible for bringing to the school.

The vast majority of colleges exist outside of Division I, playing in Division II and III as well as in the NAIA, the National Christian College Athletic Association (NCCAA) and several other smaller organizations. There is no profit to be made and no one watching on TV, save for parents watching an internet stream.

At this level, the budgets aren’t nearly as steep. Fewer to no athletic scholarships are given and travel is much more limited to regional competition and bus-able routes.

Still, the average Division II institution’s athletic budget as of the 2011-12 academic year was $4 million for schools without football and $5.3 million for schools with football.

According to the NCAA report, these schools generated an average of $624,000 in revenue, leaving the rest to be funded by the institution.

That is an expensive bill for the institutions to pick up.

However, institutions continue to fund and in many cases expand the department.

For those below the Division I level, the benefits outweigh the costs, and in many cases, the institutions are turning a “profit”off the programs.

The “profit” is students paying tuition. With far fewer athletic scholarships offered in lower divisions, the expense becomes far less for institutions.

The athletic department acts as a way for schools to attract students who normally wouldn’t be interested in attending.

At Providence Christian College in Pasadena, California, a school founded in 2005 with an attendance of more than 200 students, according to athletic director Dr. Chuck Ryor, athletics are a vital part of their enrollment. Almost half of the student population are athletes.

“Athletics is another means for us to reach college students who might otherwise not want to come to a liberal arts school, with the kind of theological emphasis we have,” Ryor said.

The college wants to continue to expand their enrollment to over 400. Expanding the athletic program to attract students is part of that.

The same is true for Life Pacific College, members of the NCCAA, in San Dimas, California. The school of 609 students cut the athletic program in 2007, but restarted it this year with women’s volleyball and men’s basketball, and plans to add men’s and women’s cross country, soccer, golf and women’s basketball over the next five years.

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Life Pacific’s new gym, hosting the men’s basketball and women’s volleyball teams.

“It’s a great avenue to bring more kids in and give them more opportunities to be in an athletic environment. It boosts numbers and it boosts financial numbers,” athletic director and head basketball coach Tim Cook said. “Minimal scholarship sports add to the overall value of the school. “

While Life Pacific and Providence Christian represent the smallest, most niche institutions, the small enrollment mean each student’s tuition is important in the funding of the university. But, they aren’t the only ones who see athletic programs as drivers of enrollment.

Danny Barnts, now the sports information director of Point Loma Nazarene in San Diego, says that during his time working at Western Oregon, the public university of 6,214 entertained adding junior varsity teams as a way to attract tuition—paying athletes with minimal expense.

Barnts offered Pacific University, in Oregon, as an example of this. The Division III institution offers seven JV programs along with 22 varsity teams, including a rare women’s wrestling team.

But for Barnts current institution, Point Loma, the Sea Lions don’t have the same need to drive enrollment as it is capped at 3,600.

There, the university’s 10 athletic teams are seen as a part of the student life of the university.

“Athletics is supposed to be one of the focuses of the student on campus entertainment for the regular students to add to the student life aspect,” Barnts said.

At Life Pacific, the benefits to campus culture are noticed as well.

“It’s the most incredible thing I’ve ever seen, the environment that our sports have created for students,” Cook said. “People are painting their bodies, you can’t get a seat in our gym, and everything revolves around volleyball and basketball for the community to come out. It has transformed the campus.”

But small, private universities aren’t the only ones competing at lower levels. Cal Poly Pomona, a large, primarily commuter campus of 22,000, plays in the California Collegiate Athletic Association, a conference of state institutions in Division II.

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Cal Poly Pomona’s sprawling campus.

There, a student-athletes in-state tuition is far less important to institutional funding than it is at Life Pacific or Providence Christian.

The additional tuition of the Broncos’ 10 athletic teams has far less effect on their budget than private institutions. But along with the rest of the state-funded colleges in the conference, the Broncos spend money on athletics.

“The value overall is still has a big impact in terms of strengthening or weakening the university image,” said Ivan Alber,Cal Poly Pomona’s Assistant Athletics Director. “At Division II, I still think that athletics can slide the university’s image along the scale in either direction in terms of branding, recognition and notoriety.”

He also sees it as a benefit to the student-athletes themselves.

“They are not only achieving a bit more academic success and higher GPA than the general student body, but also their time management and leadership skills,” Abler said.

Another unique institution, Academy of Art University, has their own reasons for starting an athletic program in 2008. The university is a for-profit art and design institution in downtown San Francisco. They lack all of the traditional athletic facilities and instead rent different locations around the city for their programs.

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A campus map showcasing the unusualness of Academy of Art’s campus.

“We created a niche for art and athletics to exist simultaneously as an opportunity for students after high school,” Academy of Art’s Assistant Athletic Director for Media Relations Rob Garcia said.

He also added that the athletic program helps attract international athletes to the university.

Despite the money pits that athletics have become at the Divison I levels, where hundreds of schools take huge subsidies in hopes that they will one day join the ranks of the few who turn a profit, lower-level schools still get value out of their athletic programs.

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