Sunday, August 30, 2009

Athletic Budget Update #44

Vanderbilt men's basketball coach Kevin Stallings passed on a $100,000 pay raise in order to fund his team's international travel to Australia this summer.  

Indiana will receive $3 million next season to move a home football game against Penn State from its on-campus stadium 650 miles east to Maryland.  Athletic Director Fred Glass stated when justifying the decision.  "We're a PT boat in a conference dominated by aircraft carriers...It's incumbent upon me to be creative and look for reasonable ways to close that revenue gap. I feel like this is a small step in that direction."

Following up on an earlier posting at ultimatesportsinsider.com, public colleges and universities in North Carolina can continue to grant out-of-state student athletes in-state tuition rates, at a cost of $10 million each year.  The reduction was being examined in response to state budget cuts.

Fresno State is reducing its budget for 2009-10 by $1.8 million and is achieving the savings by cutting every team and administrative budget by 20%.


San Jose State and Cal Berkley are both planning to use bus travel for football games at USC and UCLA.  The decision to move away from charter air travel will result in $100,000 in savings while adding only about 1 hour to the travel time.  Both schools are also examining how to institute state mandated furlough days for the coaching staff so that there is no impact on either team's competitiveness.

New Mexico State's 2009-10 budget cuts include salary reductions of $1.5 million and the elimination of eight staff positions.

The Indianapolis Star has an article examining the decision to eliminate media guides at Purdue and other schools across the country.  The Indy Star also looked at the practice of housing football teams in hotels the night before a home game.

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Monday, August 24, 2009

Athletic budget update #43

It's great to be back after a short hiatus.  In the last week or so there's been some additional budget moves made around the nation.  Here's the latest:

Maryland is cutting more than $500,000 of expenses from its football and men's and women's basketball programs. 

Texas Southern will be receiving a nearly 30% increase to its operating budget after the passage of an athletic fee.  Their budget will increase to $7.7 million with the money being used primarily for travel, grants in aid and equipment for their women's teams. 

UConn has signed a media rights deal with International Management Group (IMG) that will pay the Huskies $80 million over 10 years.  The article also provides in-depth information about the savings that will be gained on the expense side of the equation for the department. 

Washington State anticipates losing $200,000 for the just completed fiscal year. 

Southern Mississippi may have to cut their operating budget by up to 10% for the coming year. 

The Chair of the Iowa Board of Regents is suggesting that Iowa State and Northern Iowa should learn to operate without any state funding, meaning a possible reduction of about $3 million for the Cyclones and $4.6 million for the Panthers (40% of the department budget).  While the cuts aren't imminent, they are being examined. 

South Dakota State is facing budget reductions and responding to them by scheduling contests closer to home, printing fewer media guides and the football team will be using bus travel instead of air for two road contests. 

Fairfield University closed part of a $400,000 budget gap by cutting three staff positions.  This and other information is covered in a lengthy Connecticut Post article that describes cuts an Southern Connecticut, University of Bridgeport, Sacred Heart and a number of other Nutmeg State institutions. 

Moorpark College (CA) has dropped their wrestling and men's and women's golf programs.  The two year college cited budget and Title IX as the rationale for their decision.  Likewise, LA City College has dropped all of their sports (including both basketball teams) but one (women's volleyball - because their season is about to start). 

New Mexico State Football has sent an email to boosters requesting that donors provide after-practice and late night snacks for the team. Donors have responded. "It's good stuff like trail mix or peanut butter and jelly sandwiches," said linebacker Jamar Cotton.

The Sports Business Journal has an in-depth article about the impact of football on athletic budgets

UltimateSportsInsider is quoted in the Austin American Statesman along with Daniel Fulks who compiles economic data for the NCAA and Texas Athletic Director DeLoss Dodds about the current budget environment and the potential for a widening gap between the haves and have-nots in college athletics.

Wednesday, August 12, 2009

On hiatus: Ultimate Sports Insider's top articles

With the dog days of summer upon us, UltimateSportsInsider.com is taking a short hiatus from publishing until later in the month. In the interim, I encourage you to check out some of the earlier postings. Below are the top 10 most read articles on UltimateSportsInsider.com since its inception in November 2008. I appreciate your readership, feedback and support and look forward to providing new updates after my return from a short break.

The top ten articles on UltimateSportsInsider.com since its inception





5. Financial Solutions for college athletic budgets: Part 1, Institutional ideas and Part 2 Conference and national options





Sunday, August 9, 2009

Pursuit of prestige

After reading the post about Centenary repositioning from Division I to Division III, I could not help but think of the constant effort schools put forth to remain successful at the Division I level, especially at small private schools such as Centenary. So why do schools struggle to remain competitive and provide resources to support a Division I program?

Authors Charles Goldman, Anthony Brewer and Susan Gates suggest it is in order to gain prestige by competing and winning in the most competitive division in college athletics. After performing case studies at 26 institutions and conducting over hundreds of interviews with administrators, faculty, and staff, the authors discuss their findings in the book, “In Pursuit of Prestige: Strategy and Competition in U.S. Higher Education”.

The book is an analysis of the strategies implemented by institutions to succeed in the business of higher education. As part of the examination, the authors explore three “prestige generators”: student quality, research, and sports. Among other valid points, the authors point out the dangers of investing in status. Frankly stated, it is a risky investment because the outcomes of the investment are hard to measure, it can take years to see any benefit, and perhaps the most important, improving prestige is a zero-sum game. Therefore, as one school rises in prestige “rankings”, another institution must drop. In the case of sport, improving your standing comes from defeating the competition. In order to consistently generate public attention and affect perception, schools have to invest heavily in sport programming to win often and protect their place in the rankings. Prestige is a result of winning, not playing. In the case of Centenary, the last successful season in men’s basketball (arguably the most public sport program) was in 1989-1990. Apparently at Centenary, administrators felt they could no longer afford the investment of the prestigious Division I brand.

With the uncertain economic times, resources provided for generators of perceived prestige on college campuses are limited and being more aggressively scrutinized. This is of particular importance for athletic administrators because there is no guarantee that there will be a return on the investment. Thus, it begs the questions:

How much is an institution willing to invest in status?

How much do rankings really matter?


Quick hits: Cornell recreates brand to attract students
Listen to this NPR clip from May 2006 about Cornell University’s efforts to gain in prestige. One of the concerns of Cornell’s administrators is that the school had dropped out of the top 10 in the US News & World Report. At the time of the report, Cornell was 14th. Three years later, the school’s current ranking: 14th.



Centenary: Division I prestige is important to some
"Once we are D-III, I will not support Centenary College in any manner in the future," said Timothy W. Wilhite, CFO and general counsel of Wilhite Electric Co. Inc. "I will not buy a T-shirt, attend a game, donate money, take part in an alumni function. And I now have to change my last will and testament. I would rather Centenary College close its doors than be compared to East Texas Baptist or Louisiana College. Today, a long tradition was destroyed. Therefore, I weep."

The author of this posting was Tony Weaver, Assistant Professor of Leisure and Sport Management at Elon University. Tony has agreed to occasionally provide research summaries. Prior to teaching at Elon, Dr. Weaver was an athletic administrator at Iona College, Siena College and the University of North Carolina at Greensboro.

Wednesday, August 5, 2009

Athletic budget cut update #42


Athletic programs in Iowa are facing budget cuts. Iowa is facing a more than $500,000 cut to its $65 million budget and will absorb the reductions through reduced travel costs and general operating expenses. They are also facing increased debt service on renovations to Carver Hawkeye Arena. These reductions have been minimized due to $700,000 in increased revenue from the NCAA and Big Ten.

Northern Iowa is facing a nearly $300,000 reduction to its budget (2.4% on $11.5 million) and Iowa State is facing a 3.4% budget cut.



The schools of the Ivy League have been making changes as a result of the athletic environment. Bloomberg News details reductions that include a construction freeze at Cornell and the elimination of junior varsity teams and travel reductions at Harvard. Dartmouth has also cut $500,000 from its $16 million operating budget by eliminating two positions, reducing building hours and has halted renovations to its football stadium.



The Ivy League office has moved to electronic media guides and replaced its annual football media day with a teleconference.



Sports Illustrated has an article that reviews many of the budget cuts which have occurred across the country and were covered earlier on http://www.ultimatesportsinsider.com/.





Odds and ends from previous posts



The NCAA has proposed rules to help clarify the on-going debate about the merits of Sand Volleyball, which was reviewed on the blog in two previous articles.



The Three Beer Meeting has received further support with a call in The Financial Times for email to be banished in board meetings, suggesting that shareholder interests are not served by distracted trustees.

The article provided a great analogy: "When a corporate director starts replying to an e-mail, which task is receiving attention: the message or the meeting? The most plausible answer is the message, which means that the director who is working on his e-mail is dedicating scarce resources to something other than that for which shareholders are paying. If your lawyer billed you for time spent working on someone else’s project, it would be considered negligent at best."



In addition, the NY Times reported that texting while driving makes it 23 times more likely the distracted driver will cause an accident.

Sunday, August 2, 2009

Athletic budget cut update #41 - UC Irvine and Wright State drop teams

UC Irvine is dropping five sports, men's and women's swimming, men's and women's rowing, and sailing in response to the state's significant budget woes.

Wright State's $1 million cut will constitute approximately 10% of their budget and include: the elimination of the men's track team; the firing of two long time department senior staffers; no scholarships or travel budgets for the cheer leading and dance teams; no team other than basketball permitted to fly unless they can cover the costs through fund raising; coaches are being directed to recruit in-state to avoid out of state tuition costs and some scholarships will be eliminated; significant reductions in summer school spending; and media guide production will be limited.


Hawaii Athletic Director Jim Donovan has taken a voluntary 7% pay cut and it is anticipated that other senior staff and head coaches may have to do the same thing.

The NCAA women's basketball committee has recommended that it adopt a policy that requires any team traveling less than 400 miles to use ground, rather than air transportation. The previous distance was 350 miles. They have also recommended reducing the travel party for the Final Four from 100 to 85.

The Orlando Sentinel is running an excellent five part series about the economy's impact on athletic budgets around the country.

The Chronicle of Higher Education is reporting that 11 states are anticipating mid-year budget cuts for the 2009-10 fiscal year. The cuts are expected to total more than $22 billion, which will obviously impact the athletic programs in those states.

Athletic Business writer Paul Steinbach also details the athletic budget environment with comments from West Coast Conference Commissioner Jamie Zaninovich, Penn State Athletic Director Tim Curley as well as UltimateSportsInsider.com.