Axios Sports: No football would break college sports

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BleedGopher

BleedGopher

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per Axios Sports:

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What was once unthinkable, even as recently as two weeks ago, is now being discussed openly throughout college sports: COVID-19 could force the cancellation of the 2020 college football season.

  • Why it matters: 80% of FBS athletic budgets are made up of football revenue. So if the season was canceled — or even shortened — the economic fallout would be exponentially worse than what we saw with March Madness.
  • By the numbers: Take LSU, for example. During the 2016-17 cycle, football generated $56 million in profit for the school, while all other sports accounted for $23 million in losses, according to a public records request filed by SI's Ross Dellenger during his time as a beat writer.
What they're saying:

  • ESPN's Kirk Herbstreit: "I'll be shocked if we have NFL football this fall, if we have college football. I'll be so surprised if that happens."
  • Texas coach Tom Herman: "I couldn't [imagine a fall without football] two weeks ago. I can now."
  • Athletic directors: Nearly one-fifth of FBS ADs "believe there is at least a 50% chance" of a shortened season, according to a survey conducted by Stadium.
Go Gophers!!
 


This doesn't have to be harder than it is. The main school gives an "emergency loan" to its athletic dept, to keep the budget (close to) the same for this next school year.

We're no going to have this huge economic impact for multiple years. We might lose this summer and this fall, and then a gradient over winter (end of this calendar year, to early part of next) of returning to normalcy. That's at worst.

I see zero chance that this thing last for two football seasons.
 

LSU has beach volleyball as a sport????
 

Some of the losses of the non-revenue sports is scholarships (which I'm assuming will continue, whether sports are played are not), but some of the losses are operating expenses. So the losses should be less if the sports aren't being played. Also, are the schools still being paid television and radio rights, even though they're not airing any sports (as these are prior approved contracts that pay a set amount every year)?

If this does extend into the fall, that would likely mean there is currently/will be a large recession, which means many, many jobs lost. The one-season impact of loss of football revenue will be peanuts.
 



Word said:
LSU has beach volleyball as a sport????
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Lot of schools in states/areas with no beaches do. It's a nice recruiting tool for volleyball, overall. Lot of southern schools have been trying to pump up their standing in (indoor) women's volleyball. Which has mostly been dominated for decades by the Big 10 and PAC.
 

MplsGopher said:
This doesn't have to be harder than it is. The main school gives an "emergency loan" to its athletic dept, to keep the budget (close to) the same for this next school year.

We're no going to have this huge economic impact for multiple years. We might lose this summer and this fall, and then a gradient over winter (end of this calendar year, to early part of next) of returning to normalcy. That's at worst.

I see zero chance that this thing last for two football seasons.
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Many main schools don’t have the money to loan to the athletics dept or are already subsidizing.
 

Some guy said:
Many main schools don’t have the money to loan to the athletics dept or are already subsidizing.
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In P5, I would guess they do.

At the U, the overall budget is like billions of dollars, while the Twin Cities athletic budget I think is 100 million. Surely, they could loan then 30-40 million, paid back over five years or something like that.
 



MplsGopher said:
In P5, I would guess they do.

At the U, the overall budget is like billions of dollars, while the Twin Cities athletic budget I think is 100 million. Surely, they could loan then 30-40 million, paid back over five years or something like that.
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No doubt the big ten would survive. They’re some of the wealthiest universities in the world.

Many G5 schools would be in dire straights
 

Some guy said:
No doubt the big ten would survive. They’re some of the wealthiest universities in the world.

Many G5 schools would be in dire straights
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Just as with businesses in general: so then just suspend operations for a time. What's wrong with that? Why does it have to be a straight up axing?
 


A_Slab_of_Bacon said:
Plenty of businesses won't be coming back too.

There's no easy button / suspend operations and come back later for everyone.
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There is though: the government allows businesses to pause payments, if they've suspended operations, and then make those payments at a later time.
 



MplsGopher said:
There is though: the government allows businesses to pause payments, if they've suspended operations, and then make those payments at a later time.
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What do you mean by “pause payments?” Can you provide an example?
 

MplsGopher said:
There is though: the government allows businesses to pause payments, if they've suspended operations, and then make those payments at a later time.
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"payments"

I think you're greatly oversimplifying what that would entail / the actual reach it would have / side effects.
 

PitinoFan said:
What do you mean by “pause payments?” Can you provide an example?
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I'm talking a small business that has a normal in/out cash flow to deal with each month.

Nothing is coming in. So you pause the operation, and are then granted a holiday from having to make the normal "out" payments that you would normally. This is not a forgiveness of those payments forever. Just a delay.

- Rent for your building/office space, other costs for that space (utilities, security, whatever), is what comes to the top of my head.
- Obviously no one is working, so you pause payroll ... that's an obvious side effect of having to pause the operation.
- I'm sure there are others that could reasonably fall into this scheme.
 

A_Slab_of_Bacon said:
"payments"

I think you're greatly oversimplifying what that would entail / the actual reach it would have / side effects.
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Probably

But won't there be some bad reach and side effects from having a bunch of small businesses fold?
 

Some guy said:
Many main schools don’t have the money to loan to the athletics dept or are already subsidizing.
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Many of those are losing far less than 50 million in revenue if football goes away.
 

MplsGopher said:
I'm talking a small business that has a normal in/out cash flow to deal with each month.

Nothing is coming in. So you pause the operation, and are then granted a holiday from having to make the normal "out" payments that you would normally. This is not a forgiveness of those payments forever. Just a delay.

- Rent for your building/office space, other costs for that space (utilities, security, whatever), is what comes to the top of my head.
- Obviously no one is working, so you pause payroll ... that's an obvious side effect of having to pause the operation.
- I'm sure there are others that could reasonably fall into this scheme.
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That would be an agreement between businesses. I don’t think the government has anything to do with that, and would not be guaranteed.
 

PitinoFan said:
That would be an agreement between businesses. I don’t think the government has anything to do with that, and would not be guaranteed.
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I'm saying that the government would be legally allowed to declare that this can't be declined by any business, in this emergency.

They won't. It's just hypothetical for discussion.
 

MplsGopher said:
I'm saying that the government would be legally allowed to declare that this can't be declined by any business, in this emergency.

They won't. It's just hypothetical for discussion.
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This isn’t going to be like flipping a switch, and everything is back to normal. It’s going to take years for consumer confidence to return to where is was less than a month ago.
 




LakerFan said:
Many of those are losing far less than 50 million in revenue if football goes away.
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Yup. And for many, they’re underwater to start. So losing anything, even hundreds of thousands puts their programs at risk
 

forever a gopher said:
Some of the losses of the non-revenue sports is scholarships (which I'm assuming will continue, whether sports are played are not), but some of the losses are operating expenses. So the losses should be less if the sports aren't being played. Also, are the schools still being paid television and radio rights, even though they're not airing any sports (as these are prior approved contracts that pay a set amount every year)?

If this does extend into the fall, that would likely mean there is currently/will be a large recession, which means many, many jobs lost. The one-season impact of loss of football revenue will be peanuts.
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FWIW regarding the broadcast money - almost any contract has a force majeure clause which allows one party to not be liable for events beyond their control; I'm pretty sure a pandemic would meet that legal defintion.
 

Some guy said:
Because pausing programming for a time wrecks programs. Ask SMU
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I don't agree that is apples to apples. There was an additional "stench" around SMU for having gotten a "death penalty".
 

Some guy said:
Yup. And for many, they’re underwater to start. So losing anything, even hundreds of thousands puts their programs at risk
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"Losing" I think is a lot of hand-waiving. At the larger programs, anyway. I think they bring in so much money, via football and conference distributions, they have to hand-waive really fast to make it look like they're just breaking even.

What you say probably does hold water for most programs that aren't P5 in football though, or Big East bball or equivalent.
 


4four4 said:
Saving lives is the most important thing here. Nothing else matters.
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Right, but then the other side will say that destroying the economy will kill more people than we save.

There is no objectively correct position. It's a matter of moving the knobs and levers to somewhere that we hope is an optimal tradeoff.
 

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