Time to Dispel Myth that Athletics can Bankroll a College

Athletics contribute enormously to college life. They provide a unifying force across the campus community in which the college’s principal stakeholders – faculty, students, staff, alumni, parents, donors, and the community – can rally with pride in support of the institution.

Athletics are often the public face of a college. At the largest institutions, this can sometimes create special risk – think Baylor and Penn State – but for the most part a robust college athletics programs delivers far more than it risks.

Too often athletics can be its own fiefdom. There are times when trustees and donors step across a bright red line in the sand to put athletic interests above the academic program. The faculty are often divided over their benefit, seeing athletics as a competing interest for student time and attention. If college governance works, many of the problems emerging from athletics can demonstrate how a college that typically operates with the complexity of a small city works out the pressures of competing interests amicably.

college football game

The role of athletics can take on a very different meaning, depending upon the campus. At the largest NCAA Division I schools, the stakeholders treat sports as the defining factor that shapes their loyalty to the university. They see student athletes as budding national sports figures, at least in their premier sports programs. In many cases, these students stand apart from the rest of the student body and are often treated accordingly.

In Division II and III, student athletes are more like the general student body, but they also play a critical role albeit one with less frenzy and hoopla. One of the best-kept secrets at smaller Division III schools, for example, is that athletic programs can not only improve diversity but also directly affect the gender balance of an incoming class. Maintaining a large football roster, for instance, can offset the skewing toward women who matriculate in greater numbers than men at small liberal arts colleges.

Higher education leadership must make a decision on where administratively to house sports. Their decision is colored by how they see the contribution of athletics to student life.

College Athletics Must Be Aligned With Student Life

However athletics fit into the organizational chart, sports programs must ultimately be seen as the most valuable asset – linking the college’s stakeholders together – in the student life arsenal. But it is critical to break up the athletic fiefdom, even at the risk of trustee and donor angst, to align sports with student life.

The biggest problem is that athletic programs can’t meet their “all in” expenses. Most estimates suggest that only one in eight athletic programs support themselves. This issue will become increasingly important as the pressure to look for internal savings grows as the economic model that shapes a college’s operating budgets moves toward collapse.

How can colleges justify high tuition sticker prices, rising tuition discounts, and decreasing net tuition revenue while continuing to bankroll a wide variety of costly sports programs?

Dispelling the Myth that Athletics Can Bankroll a College

One answer may be to rethink how colleges finance athletics. The sports program costs a lot, especially if scholarships are provided and the college makes heavy investments in people, programs, and facilities to recruit and compete. The costs also increase with NCAA reporting and compliance requirements. Finally, the college, especially at the Division I level, must run almost two programs simultaneously – a competitive program for Division I athletes and a general recreational, health and wellness program for the general student body. The costs in duplicated facilities can be enormous.

Colleges Must Get a Handle on How to Finance Athletics Programs

The bottom line is that we must work to get a handle on how to pay for the costs of college athletics. It is pointless to fight an open battle to reduce the number of college sports, since each finds a committed constituency. But there can be expectations placed on how a college or university runs its sports program and pays its bills.

First, not all sports are equal. It is possible to run a tiered competitive program that allocates resources based upon the importance and level of investment required for each sport while still meeting Title IX guidelines.

Athlete Recruitment Must Be Integrated into Enrollment & Financial Aid Strategies

Second, athletic recruitment must not be a stand-alone operation but fully integrated into enrollment and financial aid strategies. If done correctly, the recruiting and student financial aid packaging can neutralize the overall cost of sports on a campus.

Athletic Facilities Should Be Considered Community Investments

Third, colleges and universities must see their facilities as community investments. In some cases among sports in lower ranked tiers, it is possible to utilize existing community facilities in their regions. In other cases, these facilities can be designed as public-private partnerships. Whatever the solution, they must not tie up a college’s debt capacity unless this investment makes sense as part of a larger comprehensive solution. Indeed, the development of new athletics facilities is an important opportunity to attract micro-targeted donor interest in a college.

In the end, colleges and universities searching for efficiencies must look at athletics. It must be accomplished with an eye to strengthening a sustainable sports program. But done correctly, it may also be the best way to preserve the role of athletics in student life.

This article first appeared on the blog of The Edvance Foundation.

2 thoughts on “Time to Dispel Myth that Athletics can Bankroll a College

  1. Today’s San Francisco Chronicle carries a piece under the headline “Cal, Under Armour release new home football uniforms” (http://www.sfchronicle.com/collegesports/article/Cal-Under-Armour-release-new-home-football-11252914.php). Cal refers, of course, to the University of California at Berkeley, the so-called “Athens of the West.” Under Armour is a private sporting goods company best known for producing Stephen Curry’s “signature” shoes. From the article:

    “Having lost about $22 million last year and facing the debt of at least $400 million promised in the retrofit of Memorial Stadium, the Cal athletics program is in extreme distress. But the new deal with Under Armour and two separate contracts with Learfield are projected to provide about $8 million more annually than the school’s previous contracts in apparel, multimedia and licensing.

    “The agreement with Under Armour is a campus-wide push aimed at unifying the school’s academics and athletics and will include the university’s recreational clubs and the band. Under Armour will also outfit the sports teams from school’s entire athletics department.”

    Words fail.

  2. This post ignores the fiscal reality that at almost all American universities and colleges, athletics creates vastly more spending than athletics creates in revenue. This athletic deficit is always made up by the drawing on the Cash Cow — precisely, student generated revenues. In sum, academics subsidizes the athletic programs. Maybe this is reasonable at some schools, where all students have no trouble paying their university bills — but if so, name the schools, please! At my university, over 10% of every dollar that students pay EMU goes to support athletics. And none of our teams ever draw a true crowd; the stadium is never close to half full. Lots of Division 1 schools are like this. Athletics on campus rarely anymore unifies a campus, like they allegedly did in days of lore.
    So, students and tax payers spend fortunes on subsidizing athletic programs that quite often few students care about. Wouldn’t most students prefer, say, a 5% or 10% cut in their costs of going to college? Yes, of course, but the students are seen as Cash Cows by the decision-makers. (The top 20 or so universities in Division 1 earn enough from athletics to cover athletics cost. Your school is not likely one of these!)
    — Mark Higbee, professor of history, Eastern Michigan University

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