Print

June 27, 2011 - In FCS athletics, ambitions compete with costs

The Chronicle of Higher Education reported that nearly a third of the 125 athletic departments that compete in NCAA Division I-Football Championship Subdivision (FCS) increased their spending by more than 40 percent between 2006 and 2010.  The recent article also stated the median deficit of those athletics programs was more than $9 million.

Other research suggests that increased sports spending may be coming at the expense of academics. A forthcoming report by the Knight Commission on Intercollegiate Athletics finds that athletic spending among public colleges in the championship subdivision grew by 42 percent from 2005 to 2009, nearly twice as fast as academic spending. Meanwhile, institutional subsidies to athletics grew by 34 percent, according to the Delta Cost Project on Postsecondary Costs, Productivity, and Accountability, which did the Knight report's analysis of per-athlete and per-student spending during that period.

The article noted the concern about institutions who are members of the FCS which do not have as great of access to major sources of revenue as institutions at the highest level of competition, which is the Division I-Football Bowl Subdivision (FBS).  Most programs at FCS are far from financially independent, relying on institutional support and student fees to cover most of their expenses. Unlike FBS athletics programs, the FCS programs have smaller stadiums, fewer alumni and fans, and no rich media contracts

Daniel L. Fulks, who writes an annual NCAA report on Division I finances, told the Chronicle:  "On the revenue side, they're really in a bad spot. But on the expense side, they're not far off from their big brothers and sisters."

The Chronicle also stated how concerns about revenues at the NCAA’s elite level thirty years ago have now resurfaced at the next level down. While many of the elite programs eventually found ways to make more money, for the ones just below them—especially the smallest in the group—there are no clear answers.

Mark Scally, the chief financial officer for the athletics program at Southern Illinois University at Carbondale, said: "The easy solutions are gone. There's a certain limit to how much you can cut before you run out of options. Once we get to that point, where there isn't anything left to cut and there isn't any revenue to go get. ... I have no idea. I have this nightmare of this cataclysmic explosion at the end."

Several athletics programs new to Division I-FCS were identified in the article to provide an understanding of the extent of the issue.  From 2006 to 2010, after adjusting for inflation, the University of Northern Colorado increased its sports spending 58 percent, South Dakota State University 48 percent, the University of Central Arkansas 47 percent, and Southern Utah University 68 percent.  These institutions are still experiencing the rapid uptick in costs that comes with more scholarships and heightened competition in Division I. Other athletics programs, like Georgia State University and Old Dominion University, have recently started football programs.

The four athletic departments where spending grew the most—Winston-Salem State University, the University of Arkansas at Pine Bluff, Southern Illinois University at Carbondale, and Georgia State—more than doubled their expenses.

Increases in student fees are helping to support athletics programs at many institutions. At North Carolina Central University, because of cuts in state support, student fees proved crucial to growth in athletics. Student fees increased from $345 in 2006 to $621 next year and now account for two-thirds of the athletics budget.   And, at Southern Illinois University at Carbondale, fee income covered more than half of $76-million in recent construction, including a new football stadium, major renovations to the basketball arena, and an academic-services building for athletes.

According to the Chronicle, 10 out of the 125 FCS institutions cut their spending. They trimmed in a variety of ways, like scheduling more regional events as opposed to national ones, cutting down on the size of traveling teams, and leaving open positions unfilled.

Many may consider the reduction of their budget as symbolic in a way of sharing the financial burden that many institutions are facing. However, some athletics officials see their low ranking as a failure in the athletics arms race.  "I'm not sure being able to continue to operate at less or at the same amount continually is a good thing to brag about or a good thing to have out there," said Jim Fallis, athletic director at Northern Arizona University, which reduced its spending by 6.6 percent from 2005-6 to 2009-10, once inflation is taken into account.

 

Link here for the article, “In Athletics, Ambitions Compete with Costs”

Link here for the article, “Sports-Spending Laggard Feel the Pain, Play Catch-Up”

Link here to access the Chronicle’s database of FCS athletics budgets