School Budgeting and Universities Academics V. Athletics

1. School Budgeting and UniversitiesAcademics V. Athletics By: Victoria Thane

2. Outline • Why universities fund athletic departments? • Where does the funding come from? • Are the methods universities use to provide athletic funding ethical? • Are there solutions, if so, what are they? • Sherman Antitrust Act • Realignment of conferences • NCAA and COIA partnership

3. University Funded Athletic Departments • Recognition • High profile facilities, coaches, and athletes • Billion dollar television deals/contracts • “Increased revenue” • Beneficial to entire university: • Increased application ratios • Increased donations by alumni • RER’s (regional economic returns) • Government support

4. Discussion: What percentage of university athletic departments make more than they spend? 1.316% According to Coakley, out of 1900 intercollegiate sport programs in the United States, less than 25 of them consistently make more money than they spend.

5. Who is Paying for It? Myth: “Athletic departments are self-sustaining.” They are NOT self-sustaining.

6. Discussion: YOU! If athletic departments aren’t self-sustaining, where does funding come from?

7. Student fee’s: • Technology • Student activities • Laboratory costs General fund: • Housing • Administrative costs for faculty members • Maintenance • Health services • General savings fund Athletic funding is also stemming from…

8. Education

9. Are the methods universities use to provide athletic funding ethical? Myth: “Universities charge high rates at sporting events to reallocate revenue to other dimensions of the university.” WRONG. In 2006, a survey found that 78 percent of Americans believe college athletic programs are profitable. Reports by administrators and the NCAA raise a considerable amount of doubt that athletic departments subsidize financially towards the academic enterprise at all.

10. What is Hurting Academics? • High coaching salaries • Paying coaches million dollar salaries do not lead to any other institutional benefits, such as: • Funding research • Attracting new professors/faculty members • These are the essential components of an institutions mission and financial development.

11. How are universities compensating? • Cutting academic spending • cut academic spending rather than minimalize athletic funding. • States effected? • Missouri • Will be inflicting a 7 percent cut in academic funding for higher educational purposes and is pushing to extend that deficit by another 13 percent in the next two fiscal years. • California • “Such slashes will result in increased tuition, faculty lay-offs, reduced course offerings, more crowded classes, and dirty campuses.” • Texas • A reduction of financial assistance for over 60,000 students.

12. Discussion: What are some possible solutions to separating athletic funding and academic funding?

13. Solutions • Sherman Antitrust Act • What has kept the NCAA immune to the Sherman Antitrust Act: • Amateurism • Remaining educationally mission-minded • If the NCAA allows institutions to lose sight of the educational purpose by reducing educational funding and subsidizing athletic funding, they will therefore open themselves up to antitrust claims and potential lawsuits, which is an argument for the limitation of athletic funding. 2. Realignment of conferences • Commercial conference structures • Educational conference structures • In this proposed solution universities could operate within conferences that they fit best with according to their missions, whether academically or athletically. Separate conference structures could potentially help regulate spending by the numerous institutions that cannot afford Division I athletics and “steer them towards providing an athletic experience compatible with their academic missions.

14. 3. NCAA and COIA partnership • Structured under faculty senates • Deliberation with the NCAA • Establishes platforms that are either approved/disapproved by the NCAA • Original proposals of the COIA: • Academic Integrity • Athlete welfare • Governance • Finances • Over-commercialization

15. Resources • Coakley, J. J. (2008). High School and College Sport. Sports in society: issues and controversies (10th ed.). New York: McGraw-Hill. • Getz, M., & Siegfried, J. (2010). What Does Intercollegiate Athletics Do To or For Colleges and Universities?. montana.edu. Retrieved November 7, 2013, from http://www.montana.edu/econ/seminar/Archive/siegfriedcollegesports%20052010.pdf • Hunter, R., & Mayo, A. (1999). Issues in Antitrust, the NCAA, and Sports Management. Marquette Sports Law Review, 10(1). Retrieved November 7, 2013, from http://scholarship.law.marquette.edu/cgi/viewcontent.cgi?article=1443&context=sportslaw • Kiley, K. (2013, January 13). Playing Different Games. Universities spend more on athletics per athlete than on academics per student, report finds | Inside Higher Ed. Retrieved November 8, 2013, from http://www.insidehighered.com/news/2013/01/16/universities-spend-more-athletics-athlete-academics-student-report-finds • Luzer, D. (2011, February 9). Athletics over Academics: An Improper Equation For State Universities. The Washington Monthly. Retrieved November 7, 2013, from http://www.washingtonmonthly.com/college_guide/blog/athletics_over_academics_an_im.php?page=all • Ridpath, B. (2008). Can the Faculty Reform Intercollegiate Athletics? A Past, Present, and Future. Journal of Issues In Intercollegiate Athletics, 1, 14-17. Retrieved November 14, 2013, from http://0-web.ebscohost.com.umhblib.umhb.edu/ehost/pdfviewer/pdfviewer?sid=871ea413-de18-4eb7-8ff0-1bf47e68cc19%40sessionmgr110&vid=10&hid=125 • Roland, P., & Joseph, A. (2013, October 5). What is a General Fund?. WiseGeek. Retrieved November 7, 2013, from http://www.wisegeek.com/what-is-a-general-fund.htm • Weaver, K. (2011, Jan. - Feb.). A Game Change: Paying for Big-Time College Sports. Change Magazine, 43. Retrieved November 7, 2013, from http://www.changemag.org/Archives/Back%20Issues/2011/January-February%202011/game-change-full.html