Here’s a classic “one of these is unlike the others” moment for ya’.
Category Archives: It’s Just Bidness
I do like this aside:
The bigger concerns surround post-game drunk driving and the possibility for high levels of intoxication, especially at football games, where some sections of the stadium are known for having a consistently high level of intoxicated fans who are disruptive and have to leave the game, some times because they need medical attention.
If they’re intoxicated when they get there…
Some mid-day nourishment for you.
- Honestly, this is kind of refreshing.
- Athlon ranks the SEC’s 2014 football rosters.
- Boom says Florida has “more pressing needs right now” than an IPF.
- Does the law give the NCAA the ability to define amateurism in college sports? You can guess what the NCAA thinks about that.
- Anyway you look at it, this can’t be good news for Michigan.
- On the other hand, when you’re at Notre Dame, Notre Dame coach Brian Kelly “told me I couldn’t talk about it” is a viable course of action.
- I’m sorry, did somebody say we needed another one of these?
Jeebus: “(T)he Rutgers athletics department received nearly $47 million in subsidies from the university’s allocations fund to make up for a shortfall in the approximately $79 million athletics budget during the 2012-13 season.”
The nearly $47 million subsidy from an institution that partially relies on taxpayer funds means the state university subsidized 59.5 percent of the athletics department’s total allocations. That’s the largest percentage since 2005 — a 15.8 percent spike from last year — and its total allocated revenue is an amount that is greater than the total athletic operating revenues of all but 53 of Division I’s 228 public school athletics programs in 2011-12.
Jeebus, Jeebus, Jeebus.
Although the student fees subsidy increased 3.8 percent from last year, direct-institutional support more than doubled from the $18.5 million that the university provided in 2012. The more than $37.1 million is almost double the greatest amount of direct institutional support any Division I public school has received in a single year since 2004-05, and it would have covered the total operating expenses of 164 Division I public-school athletics departments in 2011-12.
But Jim Delany’s gonna make it all better.
A $1.26 million drop in ticket sales and $2.8 million less in contributions helped contribute to a $4 million overall decrease in generated revenue. Rutgers officials are confident the ticket figure, which at $8.7 million dropped to its lowest point in six years, will soar next year thanks to a schedule that includes traditional Big Ten football powers Penn State, Michigan and Wisconsin.
Rutgers’ President expects the athletics department to be financially independent within the next six years once it begins receiving the full share of the Big Ten’s per-school distribution in 2020. He better hope those cable subscribers show up in droves.
There are days when I can’t bitch about Greg McGarity’s fiscal prudence.
Evidently the Pac-12 runs its sports network on a similar business model to the way its athletic programs operate.
Hey, if it ain’t broke…
I think it’s safe to say that things didn’t go all so well for the NCAA at yesterday’s O’Bannon hearing. For one thing, the parties are finally going to trial. For another, the judge doesn’t sound like she’s buying a lot of what the NCAA is selling.
During the course of Thursday’s hearing, Wilken closely questioned the NCAA’s lead outside attorney, Glenn Pomerantz, about the association’s contention that the First Amendment and various case law protect live television broadcasts of sports events from claims related to improper use of the participants’ names, images and likenesses. She also asked Pomerantz about the various ways in which the NCAA says its limits on athlete compensation promote competition among its Division I schools and, thus, justify the existence of the restraints.
The First Amendment question revolves, in part, around the NCAA’s argument that college sports events are of such great public and news interest that athletes cannot demand that they be compensated for appearing in TV broadcasts of them. But Wilken asked at one point: “If the public is so interested, why can only CBS show” certain games? Pomerantz said, in part, the law allows the NCAA, a school or a conference to grant of an exclusive “right of access” to a specific broadcaster without losing the First Amendment protection.
Regarding the NCAA’s contention that the limits help with on-field competitive balance among the schools, Wilken asked: “Isn’t there a less restrictive alternative? Wouldn’t addressing coaches salaries or the money spent of stadiums” have the same effect? She also asked whether the NCAA could impose different revenue sharing rules to help schools or particular sports with their funding.
Pomerantz countered that the NCAA “is not saying we have perfect competitive balance” now, but that if limits on athlete compensation are removed, it would “make it a lot worse” because schools with greater financial resources would be in an even more advantageous position to attract top athletes.
Wilken also said she had “problems” with the NCAA’s contention that the limits on compensation promotes athletics’ integration with schools’ academic environment.
Give NCAA chief legal officer Donald Remy enough sense to avoid meeting the press after the hearing. Instead he issued a statement that’s as detached from reality as the arguments questioned by Judge Wilken are.
“We believe strongly in the merits of our case and will continue to defend the interests of the hundreds of thousands of student-athletes not recognized by the plaintiffs. For them and for all student-athletes, the current model of college sports provides opportunities for success during college and beyond…”
Yep, the NCAA is defending the student-athlete. Remy might be better served by paying attention to something else the judge said.
There is still a prospect that the case could be settled, and at one point during the hearing, Wilken told the sides: “If you want to compromise, I’m all for it – because I won’t be compromising.”
That’s a tell, guys. Ignore it at your peril.
Georgia Tech is considering offering tickets to the Clemson game in some form of an auction.
Georgia Tech’s marquee game on the 2014 home schedule will be its Nov. 15 game against ACC rival Clemson.
The athletic department is considering an auction-style sales format to maximize revenue from the game.
“I think the growth of the secondary ticket market has spurred this, as people have seen a third party profiting significantly on high-demand games and saying, ‘Well, you know what? We sure could use those resources,’” Tech athletic director Mike Bobinski said.
It’s the logical thing to do if every dollar is precious.
Tech staffers have been in contact with counterparts at Northwestern, which sold single-game tickets for two premium games last season using a version of a “Dutch auction” suggested by Northwestern economists. Every dollar counts at Tech, which continually struggles to break even financially and doesn’t fully fund scholarships for its track, cross country and swimming teams.
Tech doesn’t fully fund buyouts, either. (Which adds a slight touch of irony to this, don’t you think?)
Here’s how it worked at another school.
At Northwestern, the school sold single-game tickets for its games against Ohio State and Michigan using a modified auction. It established prices for three different tiers of seats and then lowered the prices based on demand until that tier sold out. Ticket buyers who purchased at a higher price were refunded the difference between their price and the final, lowest price. There was also a “floor price” that the school wouldn’t go below to avoid selling for less than what season-ticket holders paid.
Those going in at a higher price “are not going to feel like they got burned,” Northwestern assistant athletic director Ryan Chenault said. “The benefit, too, is if you jump in early, you get the better seats.”
Chenault would not provide sales figures, but noted that the final sales price for sideline tickets for the Ohio State game was about $190. The Michigan tickets sold for more than $100. As a comparison, the 2012 game against Nebraska, Northwestern’s highest ticket price was $70.
Chenault said there wasn’t much pushback from fans as marketers were proactive in explaining the auction. It was also pitched as an added benefit for season-ticket holders, as they could secure tickets for those premium games and avoid the auction.
“It makes (season tickets) a lot more attractive,” Chenault said.
As we all know, Tech already uses premium pricing for its more attractive home games. This is another wrinkle to keep that extra dollar out of the market and in the hands of the school. Hard to blame it for that.
The UGA Athletic Association and The Georgia Bulldog Club will follow the inclement weather operations policy set forth by the University. Any potential weather related closing will not impact the Feb. 15 Hartman Fund deadline, which is UGA’s priority program for renewable season football tickets.
It’s good to know they’ll never need an indoor practice facility for that.
Okay, I gotta admit this was good for a chuckle:
The UGA athletic board met, and approved the spending of $12 million to renovate baseball’s Foley Field. When the news was tweeted out by this reporter, a member of the football team, cornerback Sheldon Dawson, immediately responded.
“And we can’t get no indoor (practice facility),” he wrote, the disgust hard to miss.
Now, I agree with Seth that there’s a certain amount of symbolism attached to the IPF. It’s not my highest financial priority, although I understand the arguments of those who disagree about that. And I also acknowledge that we’re in an era and a region where universities are routinely expected to do with less and less public funding of their needs. (Private funding is the new black for SEC athletic facilities.) So I get that prudence and caution with athletic department funds aren’t dirty words.
However, methinks they doth protest a wee bit too much.
The subject of the Georgia athletics department’s massive reserve fund came up about midway through the meeting. An accountant with Ernst and Young had just presented his annual audit of the athletic association, reporting that as the new fiscal year began Georgia had $67.1 million in that reserve fund.
Yes, $67.1 million. Seemingly a lot of money to throw around, and build four-and-a-half indoor practice facilities.
But it’s not that simple.
Board member Bill Archer, a retired executive with Georgia Power, spoke up. Yes, that’s a lot of money, but UGA has almost twice that in debt, Archer pointed out.
“We got that money there. But we got a lot of that money there because we took out bonds to get it,” Archer said.
Across the table another board member, Bob Bishop, chimed in with agreement.
“That’s what I like to call unallocated funds,” Bishop said.
Is there another athletic department in the country that’s more defensive about how it handles its money making than Georgia’s? I’m hard-pressed to think of one. And here’s what’s particularly noteworthy here – this is coming from a program that is routinely in the top three or four nationally in terms of athletic department profitability, but ranks nowhere near as high in overall revenues. It’s not hard to do the math to figure out how that’s possible.
As far as the bonds argument goes, I think any average Joe or Jane who’s ever borrowed money to buy a house will tell you that assuming you’ve made a sound investment, cash flow is a lot more relevant than whether you’ve got enough money in the bank to pay the mortgage off tomorrow. Georgia is doing swimmingly there, and stands to do even better once the new TV moneys start rolling in.
So you’ll have to pardon me if I take McGarity’s hand wringing about revenues…
“You see that big reserve there, but our margin’s right now are not very strong, because of our revenue. Think about it, we haven’t raised ticket prices since ’08. … The only way we can really generate more revenue is to raise ticket prices. We don’t want to do that.”
… with a rather sizeable grain of salt.
How much has the SEC’s wealth grown? Just four years ago, the SEC distributed $132.5 million ($11 million per school), meaning the conference’s payout has increased by 118 percent since its current ESPN and CBS deals began in 2009-10. [Emphasis added.]
As far as using the reserve fund to pay down the outstanding debt, that’s something you do if it’s your best financial option. It’s not something you do emotionally, simply because you feel better with less debt on the books. And when I say “best financial option”, that doesn’t just mean what kind of rate you can get investing your savings (although that’s certainly a valid goal). It also means taking steps to strengthen the programs that generate the cash flow that grows the reserve fund.
As the article indicates, this isn’t all about McGarity. But there is a unity of purpose at work there. Let’s just say B-M is lucky to have somebody like Mark Richt at the helm of the football program. In a number of ways, Richt helps make knee-jerk frugality pay off.