These economic times are tough, and college athletic programs are not immune to the downturn of the nation's economy. For instance, a few weeks back, Stanford announced that it expects to lose $5 million over the next few years.
Meanwhile. down in Florida, Miami is cutting back on travel, taking buses to in-state games, and plans to try and boost attendance by cutting ticket prices.
Even the traditional powers are feeling the economic pinch. Ohio State announced that they will probably lose money this year.
Like a lot of corporations, major college athletic programs are finding out that over expansion may have helped lead to the financial crunch they are facing today.
For instance, The Stanford Athletic Department sponsors 35 varsity athletic programs. For those 35 sports, there are 444 males and 374 females participating in varsity sports on campus. That 818 varsity athletes out of an undergraduate enrollment of 6,579.
12% of the undergraduate population participates in varsity athletics at Stanford.
All Universities file annual reports on athletic participation as well as revenue and expenses for college athletics. These reports are available on the the equity in athletics website.
The reports, while perhaps not exactly accurate to the dollar, do reflect the basic flow of revenues and expenses. There are two major streams of revenue: football and donations, (or funds not allocated by gender/sport).
Stanford has won the Director's Cup for best overall athletic program 14 years running. It had 47 students and alumni competing in the Beijing Olympics, bringing home eight gold medals, 12 silvers and four bronzes. But there is a price to pay for having such an expansive program, especially at a private school. Stanford lives - and dies - by the generosity of its alumni.
During the 2007-08 school year, Stanford had gross revenues of $76,661,466. Of that amount, 68% came from outside direct athletic department revenues. Stanford reported a $1 million dollar profit for the 2007-08 reporting period, leaving very little margin for error in the coming years.
Ohio State is facing the problem of trying to fund 36 varsity sports. There are 554 men and 474 women participating in varsity sports on the Columbus campus for a total of 1,028 varsity athletes.
In order to not have to cut any of its 36 varsity sports, Ohio State plans to raise football ticket prices slightly, and cut back on air travel
Ohio State - along with Texas - led way to athletic programs crossing the $100 million threshold on athletic revenues. For 2007-08, the Buckeyes reported:
Football Revenues $65,162,179 Football Expenses $33,063,248
Profit $32,098,931
Total Revenues $117,953,712
Ohio State reported total expenses of $98,981,205. However, not included in that amount was over $16 million set aside for annual Capital Debt payment. When that amount is thrown in, it sets up Ohio State to dip into the red in the upcoming year.
TEXAS, A DIFFERENT ECONOMIC MODEL -- LESS IS MORE.
There is no guarantee that Texas will not feel the pain that others are enduring right now to the bottom line, especially if this downturn stretches out. But UT is in a more solid position to ride out the recession, thanks in part to deciding decades ago that concentrating on fewer varsity sports, and giving those sports full resources was the way to go.
Right now Texas supports 20 varsity sports. There are 328 male varsity participants and 295 female participants. That makes a total of 623 varsity athletes, or 24% fewer than Stanford, and 39% fewer than Ohio State.
When Texas made the choice to concentrate on the minimum or barely above the minimum number of sports needed for NCAA sanction, they also made another committment. That was to have the best intramural program in the country.
Over 23,000 students participate in the intramural sports program at the University of Texas.
The Texas Intramural Sports Program offers over 100 team, individual or dual events in Men's Women's and Coed Divisions. The sports range from football, basketball and softball all the way to indoor soccer and sports trivia. The intramural facilities are among the best in the nation and are in constant use.
For the 2007-08 years, Texas reported:
Football Revenue $72,952,397 Football Expenses $20,049,651
Profit $52,902,746.
Total Revenue $120,288, 370 Total Expenses $100,982,596
Profit $19,305,774
Newly renovated DKR-Texas Memorial Stadium offeres additional revenues
"Luck is When Preparation Meets Opportunity"
When Texas kicked off the 2008 football season, the expansion at the north end of the stadium was complete enough to allow for an additional 10,000 fans to enjoy the game. It also allowed UT to enjoy several added revenue streams, which were already in place before the current economic crisis hit full bore.
Aside from the additional money from ticket sales, there were 47 new suites. Those suites lease for an average of $62,000 annually -- plus the cost of season tickets. The new suites brought the total to 111 througout the stadium and they were all taken. There was even a waiting list for future openings.
Another revenue stream that received a big boost was concessions. Then there are sponsorships. Want to put your message on "Godzillatron?" The going price last year was $250,000. The UT athletics department raised about $10 million in advertising revenue last year from corporate sponsorships, media rights, trademarks and licensing. As little as 15 years ago, that figure was just $570,000.
There are a few other programs, most notably Florida, who follow the Texas paradigm in setting up their athletic departments. And obviously, if the economic problems persist, Texas will also feel the loss in revenue as discretionary dollars will be squeezed even tighter.
But there can be no doubt that Texas is positioned better than almost any other collegiate athletic program to ride out this economic storm.
"We Are The Joneses"