A model approach

This here’s a helluva piece about what makes Alabama tick under Nick Saban by SBN’s Spencer Hall and Steven Godfrey.  We’ve pondered the melding of the Georgia Way and the Process ever since Kirby Smart was hired.  Read this and tell me if you can see Butts-Mehre doing a full buy in.

This is not a perfect measure, but it is a start. To get an idea of how big football is as a financial entity relative to the rest of the university, I took the overall expenditures for the university for the most recent available fiscal year. Then I took the claimed football program expenditures, and compared the football expenditures as a percentage of total university spending.

There are a lot of caveats and clarifications to be made here. The money football programs spend does not necessarily come from the university, and could and does come from a lot of other sources: donations from alumni; ticket sales; TV contract money; merchandise and licensing, etc. That money isn’t even necessarily counted as university expenditures sometimes due to athletics and booster organizations being housed under tax-exempt non-profit 501(c)3 organizations.

The chief purpose of the comparison is to paint some picture of how relatively huge or small a program is compared to the university’s other reasons for being a university. It’s not science, but it is a visualization of how much of the overall economy at a school is dominated by football.

The size of a university has a bit to do with some of the discrepancies here. Ohio State and Texas, for instance, are both huge state schools with large budgets. Even an extravagantly funded football program would be a small piece of the overall financial picture at a behemoth like either of these.

Yet even compared to universities of its size, Alabama’s comparison is staggering. Florida State, another football-forward state school in the same region with just a slightly larger budget, spends what would be 3.48 percent of its total university expenses on football. Clemson and Oklahoma — both around the same size on the spreadsheet — spend around 4 percent each on football. Auburn, Alabama’s closest rival and another school of comparable financial scale, ups the ante by spending what would be about 5 percent of total expenses.

It’s widely known that Alabama spends the most annually on football. In 2017, the Crimson Tide spent $62.3 million on football alone, the highest budget in the sport. What’s new here is seeing that even on a scale relative to other schools its size, Alabama spends disproportionate amounts of cash on football.

As a percentage of total university expenses, Alabama’s football budget would equal 7.18 percent of overall spending, the highest in the 11-team sample here. That is a staggering sum given what other schools spend — even other schools like Clemson and Oklahoma, where football is openly and rabidly supported by the administration and community.

Following the money — even through a pretty simple comparison like this — shows how committed the university is to football. How committed are they? By the relative numbers, Alabama is more committed financially than any other team in the nation.

For me, the somewhat surprising answer to that question is maybe.  It depends on how much they can wring out of the donors.  That’s a part of the puzzle where ‘Bama has also been ahead of Georgia.

To understand how important football is to the university in 2019, consider what the university did in the 2000s just to get here. Most observers around the state will tell you that the big change happened with the arrival of one very important person not named Nick Saban: Dr. Robert Witt, who became President of the University of Alabama-Tuscaloosa in 2003.

Witt became the instrument of many boosters who believed the University had fallen behind as an academic institution and as an athletics program. According to a high-ranking source at UAB, “Some of the prominent alumni, Paul Jr. being among them, got very concerned that Alabama was becoming a very average school and a very average program.”

The two — the football program and school — were an inseparable brand. Rather than fight that, Alabama embraced it, mostly because they had no choice. Football was woven into the network of people who controlled the University of Alabama, and the brand was arguably as valuable as any other asset the University had.

That same UAB source says the message became clear. “Together they decided that Tuscaloosa was, and always had been, honestly, the crown jewel of the university system and that they needed to get that in order.”

The crown jewel of the university’s public face was football, and to reboot the school’s image and fatten enrollment, football had to be a visible, successful asset. And in the early to mid-2000s, Alabama football was visibly and painfully unsuccessful. Alabama’s facilities were average, their teams inconsistent, and their coaches a source of boredom at best (see: Mike Shula), and scandal at worst (see: Mike DuBose, Mike Price). Worst of all, the school was losing games to hated in-state rival Auburn, at one point dropping six in a row to the Tigers.

The creation of the Crimson Tide Foundation in 2005 embodied Witt and the boosters’ complete commitment to football. A 501(c)(3) non-profit, the Crimson Tide Foundation’s paperwork listed Paul Bryant, Jr. as its Chairman, and under its “exempt purpose” section stated that that the Foundation “… provides a channel through which gifts are solicited for the University of Alabama’s intercollegiate athletics program, including facilities, scholarships, and other areas of support.”

Using a nonprofit to channel a university athletics program’s finances is common in college athletics. A search of Guidestar’s nonprofit database pulls up nine programs in the SEC alone that filed the Form 990 that nonprofits usually send to the IRS yearly. Auburn, Ole Miss, Florida, Georgia, Mississippi State, and South Carolina all submitted forms for 2017. LSU, Texas A&M, and Arkansas all at least filed in 2016. There are archives showing basic financial statements going back to most of these organizations’s founding, sent in dutifully to the feds each year by administrators.

The University of Alabama’s charitable arm, the Crimson Tide Foundation, has one 990 on record: Filed in 2005, it lists the aforementioned officers, purpose, and basic information on finances, and an Astra SP — an upgrade from the Cessna the program had been using to make the rounds.

The jet would end up being a huge tool in Alabama’s endless football recruiting tours, but even that disclosure was enough for the program to give up reporting altogether. Since 2005, the Crimson Tide Foundation — still claiming 501(c)(3) non-profit status — has claimed it is exempt from filing those pesky 990s.

Instead, the Foundation’s numbers are included annually in the University’s financial reports. In their own words, the Crimson Tide Foundation is a “blended unit.” Translated: The Crimson Tide Foundation is a private organization that works under the umbrella of the very much public University of Alabama. The university includes some numbers about the program in that report, and the university also files required basic information about the program with the NCAA.

But overall, compared to other athletics programs in its conference alone — some of which produce their own 40-page annual audited summaries like small companies would — Alabama operates with a lower degree of transparency and a different reporting system than other schools do.  [Emphasis added.]

The unity of purpose there is striking.  Unity of purpose is something that was sadly lacking in Richt’s final seasons in Athens.  That’s all in the past, though.

McGarity said at the time of the Smart hire that the administration was looking for guidance from its new head coach as to where the program needed to head in order to succeed at a higher level.  Kirby brought the road map from Tuscaloosa.  Now it’s just a matter of herding the big pockets onto the bus.

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