What does big-time college athletics cost and who pays for it?

[takethepoints]

Especially in relation to what is spent on non-athletes. See:

http://www.deltacostproject.org/sit...tAIR_AthleticAcademic_Spending_IssueBrief.pdf

Ah, always nice to find the data. What I found interesting was:

• The unbelievable gaps between the subsidies for Div 1 athletes and for academic spending per student (the ratio between the medians for the SEC was 12.2 in 2010).

• The massive cost of salaries and benefits for coaches and athletic staff.

• The massive role of ticket sales and donor contributions to sustaining the costs at all levels, but particularly for the top spending schools.

• With a few exceptions, Div 1 athletic programs - even football - are not self-supporting; fewer then 1 in four of the FBS schools brought in more money then they spent overall.

I'll have to be more careful about how I spout off about this in future.

 

[awbuzz]

The salaries of coach's and staff are ridiculous portion on cost. Sucks that "athletic FEES" are so darn high...

 

[GTNavyNuke]

Great article, thanks for posting it. I'll need to digest a lot of it. A few thoughts.

• The coaches salaries for ACC and SEC and top tier schools are not usually paid for by the school but a separate Athletic Association. Therefore, student athletic fees aren't affected by the coaches salary directly. (Costs are fungible and since the GTAA pays most of CPJ's compensation, that means that they can contribute less.)
• The second stacked bar in Chart 3 shows the % breakdown of revenue for the top tier football programs. Over 85% comes from outside the school - donations, ticket sales, TV contract, corporate sponsor ships. You don't get a lot of each of these and then you are going to have financial problems. Of course, it's a self fulfilling feedback - the more you spend the more you may make, the less you spend the less you are sure to make. Most (3/4) colleges, lose money.
• A lot of money is spent on athletics; all those who receive the money have a vested interest in perpetuating the system or getting more money. So the people who make money will whip up enthusiasm because it is in their financial self interest. {Follow the money, duh.}
• I'd have to look at the GT and GTAA financial reports to figure out how much football contributes net to other athletics at GT.

 

[TampaGT]

Where is the money going to come from if they start paying players? I think most people think that they are sitting on tons of cash. Surprise nobody is complaining that students fees will be going to directly pay other students. The pro leagues are the ones sitting on cash and should either let kids enter the draft whenever the kid wants to go pro or develop a minor league.

 

[GTNavyNuke]

I think {**dangerous**} that only the top tier money making programs will be able to pay their players. It will force CFB to go to the semi-pro concept sooner, which is where we essentially are today but with the "universities" picking up a large part of the costs.

It also depends how much the "pay" is. Say $25K a year (usual grad student stipend at GT) for 80 players is $2M a year. Not insurmoutable at GT at all, but too much at GSU or Woffard?

How the money is going to be distributed differently to get pay to players is a fundamental question. Politics is about the distribution of money and power. And there is a lot of money here:

"Newly negotiated television contracts are expected to
significantly boost athletic revenues for the top programs
in coming years, creating even more disparity in college
athletics. For the top five conferences (ACC, Big 10, Big
12, Pacific-12, and SEC), current media contracts are
expected to generate more than $1 billion per year, with
average conference revenues ranging from $12 million
to $20 million per school per year.12 College sports are
big business, and these contracts exceed the annual
media contracts for Major League Baseball, the
National Hockey League, and the National Basketball
Association."
​

From the NCAA in the Keller / EA Sports case is providing$20M to students. http://www.ncaa.org/about/resources...ncaa-reaches-settlement-ea-video-game-lawsuit

• "The settlement will award $20 million to certain Division I men’s basketball and Division I Bowl Subdivision football student-athletes who attended certain institutions during the years the games were sold."
• Of course the hypocrites at the NCAA say ""Consistent with the terms of a court-approved settlement, the NCAA will allow a blanket eligibility waiver for any currently enrolled student-athletes who receive funds connected with the settlement. In no event do we consider this settlement pay for athletics performance," Remy said."

Finally, here is a CNBC summary this week of the current legal actions involving the NCAA. http://www.cnbc.com/id/101707534 The game is fully afoot and we are going to get major changes in the next few years.

 

[TampaGT]

I think {**dangerous**} that only the top tier money making programs will be able to pay their players. It will force CFB to go to the semi-pro concept sooner, which is where we essentially are today but with the "universities" picking up a large part of the costs.

It also depends how much the "pay" is. Say $25K a year (usual grad student stipend at GT) for 80 players is $2M a year. Not insurmoutable at GT at all, but too much at GSU or Woffard?

If paying SA happen then you are going to have to pay all SA at public schools since they take tax money. So you go from 80 players to a few hundred players. I counted the number of SA GT had last year and if I remember correctly it is somewhere around 500 SA. So, that $2M goes to $12.5M. I just don't see that happening.

 

[ATL1]

The system needs to be blown up.

 

[dressedcheeseside]

I wonder if there's gonna be a "salary cap." Hell, they might as well do away with recruiting and have a college draft.

 

[GTNavyNuke]

The system needs to be blown up.

Thinking about the motivations (money) in play, I think the major parties will do everything possible to make CFB or whatever it becomes as entertaining (lucrative) as possible.

There is probably a place for the NFL to contribute via a "farm system" like MLB does in baseball - except have the NFL "farm" teams associated with colleges. But as we see in baseball, the minor leagues and college baseball don't make much money. How to keep CFB as a viable money stream has to be what all the major parties are trying to do -- only to increase the amount that they get.

I think the system is going to get "blown up". Not much we can do except watch. The inflexibility of the NCAA to change as CFB became a multi $B sport is largely to blame IMHO.

 

[ATL1]

I wonder if there's gonna be a "salary cap." Hell, they might as well do away with recruiting and have a college draft.

My opinion is that their needs to be a cap on athletic spending especially for tax payer funded institutions. The cost for a student athletic shouldn't be that wide when the majority of students on campus are having to go $100 + grand in debt. College tuition cost are rising at a ridiculous level and institutions are spending student fund money on weight rooms. Absolutely Not.

 

[ATL1]

Then the NFL should do a semi pro farm league and leave colleges out of it. Do it like baseball.

 

[GTNavyNuke]

Then the NFL should do a semi pro farm league and leave colleges out of it. Do it like baseball.

But I think that would be less entertaining (lucrative) and thus a non-starter for the organizations making most of the money right now (ESPN, advertisers, etc).

I keep thinking that this is like an arms race where the college keep spending because they feel threatened from a loss of prestige if they don't keep spending. And since most colleges are in it to maximize their revenue and principal officials compensation, I think we'll keep going till the system "blows up" as you said.

 

[bravejason]

Then the NFL should do a semi pro farm league and leave colleges out of it. Do it like baseball.

The only way that is going to happen is for the NCAA is to get serious about the student in student-athlete and adopt rules to that negatively impact the NFL. A few examples:
1. Prohibit student-athletes from engaging in practices, drills, scrimmages, film review, and the like while in the presence of a professional sports team personnel whenever such activities are not advertised and open to the general public. If NFL personnel want to watch the players, then they can buy tickets and sit in the stands like the rest of us.
2. Prohibit the dissemination of film to professional sports team personnel (and their agents, contractors, etc.). If they want film, they can watch the games on ESPN and the advertisement highlight reels like the rest of us.
3. Replace APR with GSR and require the football team to maintain a GSR of at least 75%, making no allowances whatsoever for players who leave the school prior to graduation. Complaining about scholarship reductions and practice time reductions caused by players are leaving early for the NFL and hurting your GSR? Then recruit players that want to go to school to get a degree.

I have no idea if any of those examples are practicable and I doubt if any of them would ever be adopted, but until something along those lines is implemented, the NFL doesn't have an incentive to develop any sort of farm system or semi-pro league.