ATHLETICS AND EDUCATION

Intercollegiate Athletics and its Role in Higher Education

Derrick Sherman
Georgia Southern University
EDLD 8432, Fall 2014
Dr. Don Stumpf
December 1, 2014

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Introduction
In todays world, almost all of our American colleges and universities are known more
for what they have accomplished with their competitive sports rather than whats being achieved
in the classroom. This is a trend that started as early as the 1920s when college athletics was first
commercialized. Many people feared, at that time, that college athletics would undo the very
purpose of education and, in many cases, one can claim that it may have done the total opposite
(Finn, 2001). College sports have become more and more popular every year due to the amount
of media coverage that they receive on a daily basis. College football and basketball games have
been televised on national channels for decades. But as the sports began to grow in popularity, so
did the demand for the media coverage that surrounds it. In just a short time we have witnessed
the evolution of college sports on television. It began with channels, such as ESPNU, that are
entirely devoted to covering only college sports and progressed to networks with NCAA
conference affiliations. An example of such networks is the BIG TEN NETWORK which is
dedicated to covering the athletic teams from the institutions affiliated with the Big Ten
Conference. There are even some institutions that have their own national network, like the
Longhorn Network of the University of Texas, that are designed to showcase the sports from
their institution only.
These networks, and the sports that are televised on them, have large amounts of money
involved in them. We will take a look into the overall financial aspect of college sports. Within
this report will be, an in depth look at the annual cost for these institutions to keep these sports
up and running, a look at the finances of the television channels that are covering these sports, as
well as the revenue made by the National Collegiate Athletic Association (NCAA) and how those
dollars are put back into those institutions.

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Literature Review
Many of the people that watch sports and, subsequently, support college athletics do not
necessarily know what goes into putting those student-athletes on their respective playing fields
or courts. Each individual on a team has to be outfitted with the proper gear and equipment, fed
properly, accommodated with suitable travel arrangements, and given the correct medical
treatment. With all of this taken into consideration, along with many other miscellaneous
expenses, reports show that Division 1 schools that have football programs spent over $90,000
per athlete in 2010 (Peale, 2013). While Division 1 schools that do not have football programs
spent an average of $39,201 per athlete, which is still more than three times the amount that is
spent on regular students.
On the highest level of Division 1, the Football Bowl Subdivision (FBS) the average
expenses for institutions athletics department for all sports was $56,265,000 in 2012(Fulks,
2013), while the average revenue for the institutions athletic departments were $55,976,000.
This means that the majority of institutions did not make any money and, in many cases, these
institutions actually lost money. In fact, only 23 out of the 228 Division 1 institutions reported a
profit in 2012. Yet still the expenses for the following year seem to grow and are somehow met.
So the question becomes, where does the money come from to fund these sports? Athletics
budgets are funded by a combination of private donations and sales of tickets and merchandise.
In return, the revenue comes from the same sources. An institutions athletic departments main
focus is to make enough revenue to cycle it back into the programs for the following year.
However, the majority of schools also have to use subsidies to close the gap in which those funds
usually come from student tuitions and even state tax money.

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Institutions revenues relies heavily on three different aspects, including ticket sales,
conference distribution, and donations from boosters and alumni. It is safe to say that in any
given year these aspects account for about three quarters of an institutions total athletics
revenue. The big pay days for these institutions happen when their sports teams have the ultimate
success, especially in terms of Football and Mens Basketball. Each team program that attends a
bowl game in football receives a payout to their conference for participating in the game, while
the NCAA Tournament in March pays out to the conference for making the tournament initially
and for each win that it gets in the tournament. The money that the conference receives is then
given to each of the institutions evenly. Therefore institutions such as the Southern Methodist
University football program that sports a 0-11 record will receive the same payout as the four
teams that will be playing in the bowl games from the American Athletic Conference.
The NCAA currently has a contract with CBS and Turner Sports worth over 10 billion
dollars over the span of 14 years (OToole, 2010). This contract pays the NCAA for the
television rights for the NCAA Basketball Tournament that many people know as March
Madness. Reports show that this tournament accounts for the majority of the NCAAs revenue,
which is then spent accordingly. About 40 percent of the revenue goes to expenses like funding
Championships, paying employees, and the services and programs that are offered by them. 35
percent of the revenue goes to payouts for the different institutions for continued success over the
years. The remaining 25 percent goes into other funds such as grants-in-aid, Special Assistance,
Academic Enhancement programs, and more.

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College Football has recently taken large steps toward tapping into these tournament
dollars as well. This year marks the first season for the College Football Playoffs which will
consist of 4 teams and two games to crown an ultimate Champion. ESPN was fortunate enough
to ink this deal with the NCAA for nearly 500 million dollars a year, for 12 years. These dollars
are also to be divvied out in a similar manner as those made from college basketballs March
Madness Tournament. However, the payouts will not depend on the success over a period of time
as it does for basketball programs, these payouts will be year to year.
Implication
With all of the money that it takes to run a successful athletic program, it must be
determined if it is worth it for the university to spend time, effort, and funds into raising money.
Basically, will the money made from the money spent on advertising and advancing athletics put
an athletic department in the black or in the red, fiscally speaking? Many schools believe it is
worth it because of the benefits of publicity that high-profile, winning programs receive. Current
students can gain a sense of pride for their university, while alumni and supporters become even
more eager to make larger contributions. Some schools even went a step further to say that
successful sports teams also improve the academic level of the school (Woods, 2011). They
claim that the success of individual teams, and media exposure sparks more students to apply for
their school which consequently allows for institutions to be more selective in their admissions
process. In a report by Robert Frank of Cornell, Boston College reported a 12 percent gain in
applicants following their 1984 Orange Bowl win that ended with a miracle pass by Hall of
Famer Doug Flutie (Woods, 2011).

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With media coverage of college sports being at an all-time high, many viewers become
intrigued with just the thought of playing college sports, no matter how large or high-profile the
school may be. This really helps the smaller and lower level teams that may compete at the
Football Championship (FCS) level or even Division II or III.
At some small schools, athletics play a significant role in achieving new student
enrollment. Due to the popularity of the sport, many lower-tier players choose to continue their
sport on a level in which they can compete, and in many cases, are willing to pay money out of
their own pockets to do so. At the Division I-FBS level, each team is allowed to have 85
scholarship players on a roster which means only 30 percent of the players on the roster pay
tuition out of pocket. On the Division II level, each football program is only allowed 36
scholarship equivalencies. Therefore, more than 70 percent of football players will pay full
tuition. The pot gets even sweeter for Division III schools because they are unable to offer any
athletic scholarship money for any sport. This means the institution is receiving full tuition from
every athlete that competes. Often, these schools will have varsity sports teams as well as junior
varsity teams. This brings in even more money from these athletes tuition and, even better; these
schools dont have to make any sacrifices when it comes to admissions standards. King College,
in Tennessee, put together a plan to grow their enrollment using athletics by adding programs,
and junior varsity teams to already existing programs, and saw their overall student enrollment
grow by 76 percent and their student-athlete enrollment grow by 117 percent (Kurz, 2007).
Conclusion
Fielding athletic programs at the collegiate level can come with a very steep price tag, but
can be very beneficial to institutions overall. Some schools may have winning football programs

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for decades and not have a single year in which they make more money than they spend.
Athletics can be used as the largest marketing tool for an institution. The University of
Cincinnatis Athletic Director, Whit Babcock, stated that athletics attracts about 400,000 people
a year to campus. The University of Cincinnati spends over 40 million dollars a year on
athletics, which accounts for 4 percent of the institutions overall budget (Peale, 2013). Babcock
believes the 4 percent of the budget is well spent.
Athletics is a great way to grow a university, both through publicity and through profit.
Division I institutions without football programs are in a perfect position to compete for profit
every year. Xavier University, a school without a football program, can spend the money
($90,000 per athlete) that isnt being spent on football in other places. Xavier has invested
heavily in their mens and womens basketball programs with facilities, coaches, and recruiting
budgets and has seen it pay dividends. Both the mens and womens basketball teams are
successful national contenders for the tournament every year. Recently they have joined the BIG
EAST Conference, which will almost surely have them pulling in a profit annually through
athletics and keep their donors excited and invested. Their campus has grown in enrollment and
in size and all of the credit goes to their newly found athletic prowess.

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References
Bonfiglio, R. A. (2011). Bottom line: Intercollegiate athletic programs deepening their
educational impact. About Campus, 16(3), 29-32. doi:10.1002/abc.20066
Finn Jr., C. E. (2001). The Cost of College Sports. Commentary, 112(3), 53.
Fulks, D. (2013). NCAA Division I Intercollegiate Athletics Programs Report. In Revenues &
Expenses. Indianapolis, IN: National Collegiate Athletic Association.
Kurz, K., Scannell, J., & Veeder, S. (2007). Admissions, Athletics, and Financial Aid. University
Business, 10(1), 25-26.
O'Toole, T. (2010, April 22). NCAA reaches 14-year deal with CBS/Turner for men's basketball
tournament, which expands to 68 teams for now. Retrieved November 24, 2014
Peale, C. (2013, September 15). Athletics Cost Colleges, Students Millions. The Cincinnati
Enquirer. Retrieved November 25, 2014.
Sander, L. (2008). Athletics Raises a College From the Ground Up. (Cover story). Chronicle Of
Higher Education, 55(4), A1-A19.
Woods, R. (2011). Social Issues in Sport (2nd ed.). Champaign, Ill. Human Kinetics.