A year without football could hurt athletics departments’ bottom lines
By Jill Riepenhoff and Lee Zurik
Originally Published: April 26, 2020
(InvestigateTV) – If the coronavirus claims big-time college football as one of its victims this fall, it could devastate the University of Nebraska’s athletic department budget.
No other university in the Football Bowl Subdivision relies more heavily on ticket sales and TV revenue to fund its entire sports department more than Nebraska.
Those cash cows, mostly derived from its Big Red football program, account for 86% of the Cornhuskers’ athletics revenue stream, according to an InvestigateTV analysis of 2017-2018 NCAA financial data compiled by USA Today.
For 50 of the 108 public FBS universities, ticket sales and TV rights account for more than half of their revenues, according to the financial data, which is the most current available.
At the other end of the FBS spectrum is Troy University in Alabama, which relies on student fees and the school’s general funds to pay for athletics. More than 75% of its revenues come from those two pots.
Thirty-seven schools need student fees and the universities themselves to keep athletics afloat.
From Nebraska to Alabama and Connecticut to California, university presidents and athletic directors are scrambling to figure out the impacts the virus may play big-time football and their bottom lines.
“It’s hard to imagine business as usual next fall and even beyond that,” said Carol A. Cartwright, co-chair on the Knight Commission on Intercollegiate Athletics, a group of former university presidents, players and others who advocate for reforms to college sports and spending. “I think this challenge is going to help people rethink some practices.”
But the effects already are being felt at schools not at the top of revenue hierarchy with some schools cutting non-revenue generating sports and asking the NCAA to relax rules that require them to sponsor 16 sports.
But the ones who likely will take the biggest hit are the 60+ schools that make up the Power 5 conferences, more than three dozen of which have revenues exceeding $100 million.
“They are the ones who will suffer the most,” said Andrew Zimbalist, an economics professor at Smith College in Massachusetts who has studied collegiate athletic finances for three decades. “If the public health constraints are such that you can’t have students back on campus, I suspect that you would also have constraints that you can’t have fans in the stands.”
While no decisions have been made, NCAA, athletic directors, coaches and university officials are examining the potential impacts.
Asked by Snapchat’s Good Luck America host Peter Hamby if there will be college football this fall, Dr. Anthony S. Fauci offered hope.
“There’s a way of doing that – nobody comes to the stadium,” the National Institutes of Health director said.
Such an option would preserve athletic departments’ TV revenues but kill ticket sales. Nearly a third of Ohio State’s budget, for example, comes from tickets – mostly football tickets.
And then there’s the impact on the overall campus.
Cartwright said that university officials estimate that they could see enrollment decline by as much as 15%, meaning for the athletic departments that rely on university help, there will be less to go around. Fewer students equal fewer fees and tuition payments.
Some schools, such as Old Dominion and the University of Cincinnati each have eliminated a sport – wrestling and men’s soccer, respectively, to shore up budgets.
These moves have raised concerns among the Knight Commission.
“It would be short sighted to start cutting sports as a means to cut your athletics budget,” said Cartwright, who also is a former president at both Bowling Green and Kent State in Ohio.
The commission and other collegiate-finance watchdogs have long chastised the arms race that big-time athletics has fostered.
Universities have taken on massive debts to build state-of-the-art athletic facilities. Head coaches are multi-millionaires. Assistant coaches at some big-time programs earn more than $1 million a year – sometimes far more than the university president.
Elite athletes travel in luxury to out-of-town competitions, sometimes crisscrossing the country numerous times in a single season.
Only a dozen or so colleges bring in enough money to cover their expenses.
Even so, Cartwright said, they all have “huge appetites to spend money. We’ve believed for some time that the system is broken.”
In December, the commission wrote a letter to athletics’ officials telling them that reigning in spending was to be a critical issue.
“This pandemic is going to accelerate this conversation,” Cartwright said.
Right now, if the status quo remains without cuts to salaries and lavish spending, athletes who compete in non-revenue generating sports such as softball, cross country or golf, will pay the price.
Their sports could be axed at their schools.
“A lot of administrators will say that they believe in the balanced opportunities and that the non-revenue sports are just as important,” Cartwright said. “This will really test them in terms of whether or not those are empty promises.”