FBS School Spending More than They Make

[marenlee]

Not trying to add another FBS vs. FCS thread but an article just released on ESPN talking about FBS/FCS school spending.

http://espn.go.com/college-sports/story/_/id/9236478/ncaa-fbs-schools-spending-more-make

Here's a little snippet from the article.


INDIANAPOLIS -- Athletic expenses are rising at a faster pace than revenue is being generated at most Division I schools, according to a new NCAA study.

The 2012 Revenue and Expenses Report, released this week, shows Football Bowl Subdivision schools are spending 10.8 percent more on athletics than in 2011 despite generating new income of only 4.6 percent. Non-football playing Division I schools are contending with a larger discrepancy -- spending 8.8 percent more while seeing their revenue base actually shrink by 1.7 percent.

Football Championship Subdivision schools did far better, holding expenses to an increase of only 6.8 percent while generating a 9 percent increase in revenue over 2011 though median losses expanded by 6.7 percent from 2011 to 2012.

A year ago, the disparities were far smaller. FBS schools, for instance, had budget increases of 9.7 percent and revenue increases of 8.8 percent.

It's not the only troubling financial sign in the report.

[darell1976]

I wish they would name every school. I would love to see what schools are making and who is losing money.

[IBleedYellow]

Sounds about right.

[MplsBison]

I wish they would name every school. I would love to see what schools are making and who is losing money.

I would love to know more details too. As in, did they just study a sample size of the three groups or study every school in the three groups (DI-A, DI-AA and DI-AAA).

[darell1976]

I would love to know more details too. As in, did they just study a sample size of the three groups or study every school in the three groups (DI-A, DI-AA and DI-AAA).

I can see successful schools (Alabama, ND, etc) making money but curious about the bottom teams of the BCS conferences like Kansas, Minnesota and Colorado are they making any money. I am sure most conference teams like MAC, SB, MW aren't making money but what teams in the BCS aren't either.

[Lehigh Football Nation]

Expanding on this...

http://www.al.com/sports/index.ssf/2013/05/five_division_i_public_schools.html


While athletic revenues are increasing nationally, expenses are rising even faster. FBS costs increased 10.8 percent from 2011 to 2012, while revenues increased only 4.6 percent -- about half of the revenue increase from 2010 to 2011.
Athletic expenses are increasing at a slightly higher rate than overall university costs. The percent of FBS athletic expenses as part of a university's overall budget climbed from 4.6 percent in 2004 to 5.5 percent in 2012, and from 5 percent in 2004 to 6 percent in 2012 for FCS schools.

Five of the eight Division I public universities in Alabama subsidize college sports more than the national average, according to fiscal year 2012 NCAA figures released today and individual university financial reports obtained by AL.com.

The percentage of athletics revenue allocated by institutions at South Alabama (81 percent), Alabama State (80 percent), Jacksonville State (75 percent), Troy (71 percent) and UAB (68 percent) exceeded national averages last year.

[bluehenbillk]

So schools have a choice of lose $$ in FBS or lose $$ in FCS??

[NoDak 4 Ever]

So schools have a choice of lose $$ in FBS or lose $$ in FCS??

More like lose $$$$ in FBS or $ in FCS. Those that are losing money that is.

[MplsBison]

More like lose $$$$ in FBS or $ in FCS. Those that are losing money that is.

Not necessarily. Nothing in the report is about absolute dollars, only percentages.

[MplsBison]

Expanding on this...

http://www.al.com/sports/index.ssf/2013/05/five_division_i_public_schools.html

Good link, thanks.

Would still be interesting to see how the absolute dollars those athletic departments are receiving from the schools compare to a national average in absolute dollars.


Example of my point: school A funds 75% of the athletic department budget directly, which is above the national average of 66%. But school A is only providing $2million while the national average is $4million.

You get the idea. Absolute dollars and percentages can always be played around and interchanged so as to paint the picture most suited to the author's agenda.

[DFW HOYA]

You get the idea. Absolute dollars and percentages can always be played around and interchanged so as to paint the picture most suited to the author's agenda.

Agreed. The schools that are making lots of money will use accounting techniques to limit the appearance of retained revenue; conversely, the schools hemmhoraging money will seek to limit exposure on the balance sheets. As it relates to atheltics, I'd guess half of I-A has a net surplus each year before subsidies, 10% in I-AA, and almost no one below that.

It goes back to how "spending more than they make" is defined. By a strict definition, every college English department in the nation loses money.

[Ivytalk]

:pxpeacexI'm virtually certain that no Ivy League school is making money on athletics. But I'll sleep better at night knowing that Alabama and Auburn do.

[Lehigh Football Nation]

It goes back to how "spending more than they make" is defined. By a strict definition, every college English department in the nation loses money.

The true problem is measuring education as if it were a money-making business. One of John Silber's two unfortunate legacies.

[Lehigh Football Nation]

:pxpeacexI'm virtually certain that no Ivy League school is making money on athletics. But I'll sleep better at night knowing that Alabama and Auburn do.

The difference being the amount of interest made by your endowment in a week funds all the athletic programs. Not a business model for the rest of us. xlolx

[walliver]

One problem is that coaching salaries are booming.

If you want to win the BCS, you pay your coach millions.
If lower level schools want to keep successful coaches, you need to get our the checkbook.
If you want to attract top-flight athletes you need an indoor practice facility and luxurious work-up building.
Stadium expenses are skyrocketing - fans now demand much more than a seat with a view.
Recruiting gets more expensive every year.
In this kind of situation, it is hard to make money.
As far as "losing" money, all athletic programs break even. It's just that in many cases tuition, student fees, donations, and other non-athletic "revenues" comprise a big chunk of revenue.
Even at schools where football is somewhat profitable, much (if not all) of the profit is consumed by non-revenue sports.

There are only a handful of athletic programs where athletics are completely self-supported without a subsidy.

[ursus arctos horribilis]

I've posted this link in the past and not sure if it helps answer of the questions as to individual schools. It's from a couple years ago I think but it'll give some idea of where things are at.

http://usatoday30.usatoday.com/sports/college/story/2012-05-14/ncaa-college-athletics-finances-database/54955804/1

[AppAlum2003]

How is it possible that schools lose money? Ticket prices and required "donations" for season tickets/parking are ridiculous as it is. Demand is high for most programs - I think the problem is that supply is also a little too high. The NCAA should have put a stop on startup programs and kept it. Too many hands in the pot.