College Athletics Departments Are Breaking Even, After Shelling Out TV Money On Salaries and Lavish Facilities
By Ty Duffy
USA Today released its substantial database of financial records in college athletics dating back to 2005. Some of the numbers can be quirky, depending on how each school does its accounting. But it still presents a broad, fascinating picture. We looked at the top five public revenue programs in the Pac 12 – Oregon, Washington, Arizona, UCLA and Cal – to see how they were spending their new TV revenue. Shocker: most of it is not going to the “student-athletes.”
Revenue and Expenditure: Administrators say they can’t pay athletes because athletics budgets are tight. Said budgets are tight by choice. When departments find new revenue, they create new ways to spend it. The top five Pac 12 departments averaged $42.5m in athletic revenue in 2005. That increased to $79.6m in 2012, an 87 percent bump. Spending rose nearly as much. Those schools spent an average of $44.8m in 2005 and $76.1m, a 70 percent increase.
Scholarships: Tuition went up at most schools from 2005 to 2012. Thus, the cost of providing an athletic scholarship followed suit. We compared two-year averages from 2005/2006 and 2011/2012. The average scholarship expenditure for those schools rose from $6.7m to $9.8m, a 46 percent jump. Nonetheless, scholarships accounted for less than 13 percent of expenditure and increased less than overall spending.
Salaries: Not surprisingly, much of the money is going directly toward coaching salaries. The most egregious school was Oregon, increasing spending on coaches from $10.4m per year in 05/06 to $31.5m in 11/12, a 203 percent increase. The average was a 73 percent bump, from $15.8m to $27.4m. Cal, with the lowest increase, saw salaries rise 46 percent.
Facilities: Thou shalt have a nicer facility than every professional franchise. Much of the new TV revenue has gone toward construction projects at those schools. Sadly, Oregon’s hot tub video room got shelved. Spending on facilities increased 143 percent from 05/06 to 11/12, from around $3.4 million per school to $8.4 million. That number may be much lower than the real percentage, depending on the accounting.
Oregon spiked 180 percent, Arizona went up by 351 percent and penny-pinching UCLA by 86 percent. Washington, however, increased by just four percent. Cal saw a 17 percent decline. Those figures are a bit curious, considering Washington is doing $250 million worth of renovations to Husky Stadium and Cal just spent $321 million doing the same to Memorial Stadium.
Elsewhere: Individual schools account differently, but this pattern seems to coincide roughly with major programs around the country. Michigan, for instance, saw a 79 percent increase in revenue and an 88 percent increase in expenses from 2005 to 2012. From 05/06 to 11/12, scholarships spending rose by 40 percent, from $11.8m to $16.6m. Salary spending rose by 72 percent, from $22.4 m from $38.4m. Facilities spending increased by 103 percent from $11.8m to $24.1m.
[Photo via USA Today Sports]