Idea to Curb Athletic Spending and Increase College Sport Equity

[RailBaronYarr]

Had an interesting thought... I know many on this board are comfortable with the way college athletics (particularly football and basketball, the revenue sports) are headed. Bigger conferences, more TV revenue, higher ticket prices (along with seat licensing fees, donation requirements, etc) all in order to continue to build new facilities, pay coaches higher salaries, etc, etc.

A couple fringe benefits to having higher athletic revenue; higher revenues and or expenses are correlated with schools having higher number of offered sports:
- NCAA Div 1-A, AD revenues to # sports offered is positively correlated (0.333)
- Similarly, AD Expenses to # of sports offered is positively correlated (0.347)
- Div 1-AA is less correlated at 0.268 and 0.278, respectively.

This is tough to actually say, though, as many schools report revenues that include subsidy from the school as part of it - I wasn't able to combine other data sets. Furthermore, the correlation to athletic department PROFIT to number of sports is extremely weak (positively correlated at 0.09 without taking in to account these subsidies, which would most likely render no correlation whatsoever).

Fringe benefits of revenue/tv to fans:
- Arguably better fan experience at games (although old, outdated venues for btball and football are still highly regarded, could cite many examples)
- More tv coverage for peopleacross more areas of the country (although this is also debatable as it comes at a price in your cable/satellite subscription and also charges many who don't want it).
- The few athletic programs running in the black (and by this I mean the TRUE black after the school subsidy is added) - money flows back to the university to help keep costs down, fund research, etc.

For me, none of these benefits really add up. We see plenty of successful and rich athletic programs (Alabama, etc) with lower number of athletics (no incentive to build the # of programs they serve), and plenty of poor ones (Rutgers, Temple, UNC, all have 0 profit or barely any before subsidy) with 25+ athletic programs. We also see most of the time schools with large profits (Michigan, Iowa, Ohio State are great examples) save their profits to spend in future years on large capital projects (or reserves for coaching hires/buyouts).

Where is this taking me? Level the playing field. We already have Title IX in place, forcing equity in # of programs between gender. We are comfortable (well, many of us) with the NCAA saying that a university cannot "pay" players more than a full-ride in tuition and also with an NCAA-wide limit on number of scholarships (ideally to limit the playing field). However, some schools by legacy of their brand, location, profile of alumni, and other factors, have been able to outspend other schools in an arms race. This has allowed schools with AD revenues in the $40-50M to pay coaches salaries similar to NFL HCs. It has limited flow of money back to the school (the major function in the first place). Extra TV revenue for conferences (or teams like ND) haven't done anything to level the playing field for said teams. Look at conference champs/2nd place/even 3rd place for the major conferences over the past 10-20 years. Bluebloods with a few fluke years in there by other teams. Even with all the talk of paying players, when the NCAA briefly instituted the $2,000/year stipend a university COULD pay a FT scholly athlete, MANY schools disagreed and the rule was rescinded because schools tight on money knew they could not compete with that level of payment for all athletes.

My solution? Come up with a system to limit total EXPENDITURES on athletics. Make this a function of: total number of teams you field x cost of tuition x some factor. This factor takes in to account the school's location (costs of running business are different by region/state/city) and can be tweaked by year to remain equitable. This brings down coach's salaries, excess spending that only squeezes out those that can't compete (smaller schools), entices programs to have more sports (which will bring fair play gender-wise in both number and spend between them), and ultimately will flow more money back to the institutions.

Couple road blocks: 1) The coaches sued the NCAA when they tried to limit assistant coach salaries. Theoretically a precedent could be set here for the NCAA to not involve themselves with expenses within an institution. However, this seems to level the playing field far more than the 1990s issue was aimed at and removes some of the anti-trust issues smaller schools complain about. 2) Schools up and leaving the NCAA. There are enough schools in the BT, B12, Pac12, and SEC to form their own conference. The NCAA would have to tread lightly. 3) Any revenue over the expenditure amount that flows back to the university could technically be used to build an athletics facility or flow back in to the AD somehow. Not sure.

Anyway, just an idea, albeit a lengthily described one. Any thoughts?

 

[Dr.Don]

" Any thoughts? "

Well, so far you have zero support. So, I will give you 1/2 a point because I feel very strongly both ways.

Doc

 

[RailBaronYarr]

Well I can say no one is vehemently opposed since 190+ people have viewed but no one felt strongly enough to disagree.

 

[Dr.Don]

Well I can say no one is vehemently opposed since 190+ people have viewed but no one felt strongly enough to disagree.

Or to agree.

 

[RailBaronYarr]

Or to agree.

Touche.

 

[Sportsfan24]

I have no issue with reducing or placing a cap on coaching salaries (mainly head coaches) but I do take issue with reducing spending on athletics, particular in the sports (football and basketball) that generate the wealth. As is, those athletes or treated like professionals in every aspect except compensation, I would hate to see them lose benefit of top notch facilities and perks like academic support which is HUGE.

I forgot to add and you touched on it; with the trend towards super conferences and the Mega dollars involved the NCAA can't do anything that the schools in the super conferences don't want because it's quickly getting to a point that they don't need the NCAA or schools in the non elite conferences. 30 or 40 schools is plenty good, the other 100 or so BCS/D1 schools can kick rocks.

 

[RailBaronYarr]

I have no issue with reducing or placing a cap on coaching salaries (mainly head coaches) but I do take issue with reducing spending on athletics, particular in the sports (football and basketball) that generate the wealth. As is, those athletes or treated like professionals in every aspect except compensation, I would hate to see them lose benefit of top notch facilities and perks like academic support which is HUGE.

I forgot to add and you touched on it; with the trend towards super conferences and the Mega dollars involved the NCAA can't do anything that the schools in the super conferences don't want because it's quickly getting to a point that they don't need the NCAA or schools in the non elite conferences. 30 or 40 schools is plenty good, the other 100 or so BCS/D1 schools can kick rocks.

My point is that in the current setup it isn't really even 30-40 top schools. There are a handful at the top (USC, Nebraska, OSU, Mich, Alabama, Oregon, , etc) that spend enormous amounts and quite honestly, schools like MN or Indiana can barely keep up as it is.

I guess your point illustrates the view that people have of the revenue making sports - money for them is more important than the universities (particularly state-run ones) fulfilling their mission of academics first and educating their students at a reasonable cost.

 

[GopherGod]

My point is that in the current setup it isn't really even 30-40 top schools. There are a handful at the top (USC, Nebraska, OSU, Mich, Alabama, Oregon, , etc) that spend enormous amounts and quite honestly, schools like MN or Indiana can barely keep up as it is.

I guess your point illustrates the view that people have of the revenue making sports - money for them is more important than the universities (particularly state-run ones) fulfilling their mission of academics first and educating their students at a reasonable cost.

How do you know those schools making tons of money aren't fulfilling the universities mission of educating their students at a reasonable cost? Those schools that have been effective at fundraising and reaching out to their alumni shouldn't be held back because other schools have done a terrible job of doing so when given the same opportunity. Those schools earned the right to spend the money and more power to them.

 

[Sportsfan24]

My point is that in the current setup it isn't really even 30-40 top schools. There are a handful at the top (USC, Nebraska, OSU, Mich, Alabama, Oregon, , etc) that spend enormous amounts and quite honestly, schools like MN or Indiana can barely keep up as it is.

I guess your point illustrates the view that people have of the revenue making sports - money for them is more important than the universities (particularly state-run ones) fulfilling their mission of academics first and educating their students at a reasonable cost.

I'm admittedly biased towards the athletes of revenue making sports. In the current system everyone university affiliated is making a disproportionate of money versus the players who actually play the game.

My preferred choice would be for the athletes to stay as they are (student athletes on scholarship) and have the coaches compensated like the other university
employees/professors. The good coaches make tenure and the bad ones get fired.

As to your comment; revenue generating sports more than cover their cost. The answer is to cut sports the schools can't afford. I say the SEC has it almost correct, they just need to kick some of that money to the folks who generate it....the players (I'm not necessarily talking about cash payments).

Schools rely heavily on the money derived from the revenue producing sports to but their balance sheet in the black or close to it. Whatever cuts that need to be
made should not come from them.

The first place to start is title 9. Revenue producing sports should be exempt from factoring in. Not the scholarship count, not the coaching salaries, not the facilities, and most certainly not any additional benefits they may get should the NCAA and it's Universities decide to come their senses.

Your comment about school mission and academics coming first and money being more important to them (revenue sports) Huh? They already give tens of millions more to the schools than they spend. It's not their fault the schools decide to spend it on club sports.

 

[dinkything]

" Any thoughts? "

Well, so far you have zero support. So, I will give you 1/2 a point because I feel very strongly both ways.

Doc

I could see a Chris Voelz-type administrator presenting this proposal to a Ken Keller-type college president...and the Ken Keller-type guy embracing it wholeheartedly and implementing it unilaterally.

 

[RailBaronYarr]

How do you know those schools making tons of money aren't fulfilling the universities mission of educating their students at a reasonable cost? Those schools that have been effective at fundraising and reaching out to their alumni shouldn't be held back because other schools have done a terrible job of doing so when given the same opportunity. Those schools earned the right to spend the money and more power to them.

Well, college tuition/fees have been rising at a much higher rate than pretty much any other economic indicator (link, link) for quite some time. More and more students aren't able to repay their student loans (link, link, link) - and yes, part of this is the weaker job market and wage stagnation but also influenced largely by rising education costs. I would also say the level of subsidies so many universities fund their athletics department with is a clear indicator of priorities at many universities.

I don't disagree with you that schools who have been successful on the field are therefore effective at reaching out to alumni or local business for support. I never argued that the revenue should be capped. My point was that I believe (as do many, but obviously that is the tenuous part of this proposal) the spend on athletics relative to the total spend budget for an entire university is far out of balance for what our priorities as a society should be moving forward. Honestly, we're talking about spending $120M+ at the schools with the highest expenses (I looked at Texas and Michigan as examples) where TOTAL university expenditures are 1.5-2.0B. We're talking 5-8% of the university budget. And most schools don't give a return to their universities on this expenditure. For 300-400 student athletes!!

I'm not saying athletics aren't important. Or that sometimes football/basketball are successful enough to bring in enough money to cover themselves and other sports and still have some left over for the school general fund. That is the exception, not the rule. And the increased spending has done very little to increase parity among college sports.

I see the argument of a free market of college sports and can't argue much with that when looking at athletics in a vacuum. People will either agree or disagree with a proposal like this based on how important sports are to them and how important equity is among teams.

 

[Hank32]

why don't the Women get off their duff's and support their title nine

 

[Sportsfan24]

why don't the Women get off their duff's and support their title nine

Because even women don't like women sports.

 

[Sportsfan24]

Railbaronyarr, come on man.

Which football or basketball program in the BigTen, Sec or PAC Ten don't bring in enough revenue to support themselves? Between television, bowl, ticket and merchandise revenue and donations those programs GIVE to the universities...not the other way around.

For those programs that don't? Cool, cut their budget.....there goes women sports.

 

[Great Plains Gopher]

Basically a good idea, but would probably not fly. The expenses are obviously getting completely out of control to the discomfort, if not ruination, of many schools.

 

[RailBaronYarr]

Railbaronyarr, come on man.

Which football or basketball program in the BigTen, Sec or PAC Ten don't bring in enough revenue to support themselves? Between television, bowl, ticket and merchandise revenue and donations those programs GIVE to the universities...not the other way around.

For those programs that don't? Cool, cut their budget.....there goes women sports.

Covering their expenses isn't the problem. It's the amount of expenses relative to the rest of the athletics (and university general fund). That's my point. Do we think the point of an athletic department is only to have sports that can cover their own expenses? That's what I meant when I said the line down the middle will obviously be people who agree or disagree with what "equitable" should be with regards to competitiveness between schools and also amount of spend between different genders/sports.

I'll stop discussing the issue because it was obviously a bit far-fetched, but I don't see this high-spending arms race ending well for any medium-level program or below (and I include us in that list). I think with these superconferences forming, bigger tv contracts, etc there will be less and less parity in the sport and we will see fewer schools in the running for conference/national titles over the next 30 years. The only thing that could stop this is a huge increase in the number of quality, talented players available for D1 football. I don't think it will matter, but that's my opinion.

 

[Deleted_User]

What exactly is broken in this system that demands reform! I don't get it. Arms race or investment in profitable business? Pay for performance or robbery? I don't think the system is broken here.

I don't think universities are acting any differently than any other business in compensating their employees and making investments. What exactly needs to be different in college sports that dictates that we regulate it any differently than any other going concern. To me, this is a non issue. Yes, the rich get richer until someone shakes up the status quo. I think it was this weeks CLA newsletter that posted that game changes happen all the time to upset the status quo. The rich don't always stay rich. Very hard to accomplish.

 

[Sportsfan24]

Covering their expenses isn't the problem. It's the amount of expenses relative to the rest of the athletics (and university general fund). That's my point. Do we think the point of an athletic department is only to have sports that can cover their own expenses? That's what I meant when I said the line down the middle will obviously be people who agree or disagree with what "equitable" should be with regards to competitiveness between schools and also amount of spend between different genders/sports.

I'll stop discussing the issue because it was obviously a bit far-fetched, but I don't see this high-spending arms race ending well for any medium-level program or below (and I include us in that list). I think with these superconferences forming, bigger tv contracts, etc there will be less and less parity in the sport and we will see fewer schools in the running for conference/national titles over the next 30 years. The only thing that could stop this is a huge increase in the number of quality, talented players available for D1 football. I don't think it will matter, but that's my opinion.

First off; don't stop talking because I think you make some great and valid points for discussion. I'm at a computer and off my darn phone so I can be more succinct in making my point.

Here are my responses to your questions.

Do we think the point of an athletic department is only to have sports that can cover their own expenses?
I would say no. Sports or a valuable teaching tool and the sports experience for player and fans alike is valuable for the full college experience. With that being said; I believe that it is insane to have the position that women sports should be funded the same as football (scholarship count) and men basketball. To do so creates the high cost you speak of within the athletic department.

Artificial scholarship count to match the number of scholarships given to men creates a huge advantage for women to the detriment of their male counter parts. Colleges are deciding not have men sports that were far more self supporting than their female counter parts because of outdated title 9. I support women athletics. But not to the degree that women coaches should be paid what their male counter parts are paid in sports that provide funding for their sport in the first place.

And most of all I believe that football; particular at a school that it produces revenue for the general fund, should be exempt from the scholarship count. The more reasonable method would be an apples to apples comparison. For every male sport a school decides to fund, it should fund a woman’s sport and match scholarships count, coaching salaries and facilities. Sports that are self sufficient should not be included in title 9. If a school decides to use excess revenue from men football or basketball to fund the other sports….cool.

I think with these superconferences forming, bigger tv contracts, etc there will be less and less parity in the sport and we will see fewer schools in the running for conference/national titles over the next 30 years. The only thing that could stop this is a huge increase in the number of quality, talented players available for D1 football.
I will tell you like I tell others when the talk of rising ticket prices and player salaries in professional sports come up. People are not entitled to be able to see a game. If you can’t afford to go….tough. Nobody goes to Mercedes Benz and tell them they should sell their cars or pay their employees less so they can afford one.

Like cars, people have more affordable options. If you like baseball, go watch the saints. Me and my sons are huge football fans. As a coach I get free preseason Viking tickets so we go to those games. We also go to a ton of high school football games. My wife on the other hand loves NBA basketball so we have season tickets to the Wolves.

Superconferences are here to stay. There is far too much money to be had. This money has a far reaching affect beyond sports for the schools fortunate enough to be in those conferences. The schools that are not in those conferences? They will enjoy their individual situations just as much. At NDSU we enjoyed our championships as much if not more than Nebraska enjoyed their one little championship!

 

[Deleted_User]

First off; don't stop talking because I think you make some great and valid points for discussion. I'm at a computer and off my darn phone so I can be more succinct in making my point.

Here are my responses to your questions.

Do we think the point of an athletic department is only to have sports that can cover their own expenses?
I would say no. Sports or a valuable teaching tool and the sports experience for player and fans alike is valuable for the full college experience. With that being said; I believe that it is insane to have the position that women sports should be funded the same as football (scholarship count) and men basketball. To do so creates the high cost you speak of within the athletic department.

Artificial scholarship count to match the number of scholarships given to men creates a huge advantage for women to the detriment of their male counter parts. Colleges are deciding not have men sports that were far more self supporting than their female counter parts because of outdated title 9. I support women athletics. But not to the degree that women coaches should be paid what their male counter parts are paid in sports that provide funding for their sport in the first place.

And most of all I believe that football; particular at a school that it produces revenue for the general fund, should be exempt from the scholarship count. The more reasonable method would be an apples to apples comparison. For every male sport a school decides to fund, it should fund a woman’s sport and match scholarships count, coaching salaries and facilities. Sports that are self sufficient should not be included in title 9. If a school decides to use excess revenue from men football or basketball to fund the other sports….cool.

I think with these superconferences forming, bigger tv contracts, etc there will be less and less parity in the sport and we will see fewer schools in the running for conference/national titles over the next 30 years. The only thing that could stop this is a huge increase in the number of quality, talented players available for D1 football.
I will tell you like I tell others when the talk of rising ticket prices and player salaries in professional sports come up. People are not entitled to be able to see a game. If you can’t afford to go….tough. Nobody goes to Mercedes Benz and tell them they should sell their cars or pay their employees less so they can afford one.

Like cars, people have more affordable options. If you like baseball, go watch the saints. Me and my sons are huge football fans. As a coach I get free preseason Viking tickets so we go to those games. We also go to a ton of high school football games. My wife on the other hand loves NBA basketball so we have season tickets to the Wolves.

Superconferences are here to stay. There is far too much money to be had. This money has a far reaching affect beyond sports for the schools fortunate enough to be in those conferences. The schools that are not in those conferences? They will enjoy their individual situations just as much. At NDSU we enjoyed our championships as much if not more than Nebraska enjoyed their one little championship!

In order to have super conferences, there must be pee wee conferences. At some tipping point the pee wees will have better and better options to bid up for their services because they will be fewer pee wees to play warm up games with their competitors. So, they will be compensated better for playing the big guys. And, as the big guys will have the cash to pay, a certain amount of lifeblood will flow to the pee wees.

So, I still don't get the angst. If these smaller schools do withdraw and move down a level in their sport, the arms race ends without damaging their school. They tie into more local conferences and cut their expenses. There is no shame in doing this. The whole argument is made of straw that we need to worry about the "arms race". If a school cannot stay in the race, well, oops. Make a decision and live with it.