Category Archives: ACC
On September 10, 2016, Bristol Motor Speedway will attempt to stage the “Biggest College Football Game Ever” as it hosts the Virginia Tech Hokies and the University of Tennessee Volunteers.
Transformed into a college football stadium, Bristol Motor Speedway will be capable of seating approximately 150,000 fans. If the speedway was filled to capacity, it would eclipse the previous two largest-attended college football games: 120,000 fans at Notre Dame vs. Southern California at Soldier Field in 1927 and 115,109 fans at Michigan vs. Notre Dame at Michigan Stadium this season.
It would take the average crowd for both Tennessee and Virginia Tech home games combined to hit the 150,000 mark. Last season, Tennessee ranked #8 in attendance amongst FBS schools with an average attendance of 89,965, and Virginia Tech ranked 25th with an average of 65,632.
“To be able to play in front of a crowd that is the largest to ever see a college football game is a once in a lifetime opportunity,” said Frank Beamer, Virginia Tech head coach. “With the great fan support that Virginia Tech and the University of Tennessee have, it should be a great atmosphere.”
Tennessee is equally as optimistic about the potential to make this, “The Biggest College Football Game Ever.”
“This is an unprecedented opportunity for our football program to play in front of the largest crowd in the history of college football,” said Vice Chancellor and Director of Athletics for University of Tennessee, Dave Hart. “Bristol Motor Speedway will be perhaps the most unique venue to ever host a college football game. Tennessee students, faculty, alumni, and fans will look forward to being a part of this great event.”
The evolution from speedway to college football stadium will need to take place over a short period of time, because Bristol will host a NASCAR race the August preceding the Battle at Bristol. Here are some key facts about the transformation provided by Bristol Motor Speedway:
- Immediately following the August 2016 NASCAR race at Bristol Motor Speedway, approximately 400 workers will immediately begin bulk cleaning, and then detailing, the Speedway
- Next an estimated 10-12 crews will begin pressure washing – a process that is normally done in February prior to the March NASCAR weekend
- Separate crews will clean all suites in seven days – a process that normally takes four-to-six weeks
- Turf and field build will be completed in eight days
- Approximately 8,500 tons of rock will be used to build the base of the field
- The rock will be brought in by approximately 400 truckloads. The complete haul-in process will take three, 10-12 hour days
- The base rock will be 3’-6” deep in the middle of the infield tapering to 1-1/2’ on sidelines to create the proper sloping effect for drainage
You can find more details about the event and sign up for ticket and event information at BattleatBristol.com.
UPDATE: The Richmond Times-Dispatch is reporting each team will receive $4 million as long as they sell at least 40,000 tickets, with escalators that could raise that amount to $4.5 million.
Kristi A. Dosh is an attorney and founder of BusinessofCollegeSports.com. Her latest book on the business of college football, Saturday Millionaires, is available now. Visit SaturdayMillionaires.com for retailers and a sneak peak at the first chapter! Follow her on Twitter: @SportsBizMiss.
What better way to make an entrance into a new conference than by breaking the NCAA’s all-time attendance record for an on-campus game? Syracuse is considering moving the basketball court to the middle of the Carrier Dome, as a one-time deal for the highly anticipated Duke game this upcoming season. The move to the middle of the court has the possibility of drawing in a crowd of 50,000 or more. The current record held by Syracuse is 30,012 set on February 23, 2013 when Syracuse hosted Georgetown for the last time as Big East rivals.
Moving the court would be Syracuse’s grand way of celebrating their recent membership into the ACC. Syracuse’s executive senior associate athletic director Joe Giansante told Syracuse.com, “We had a wedding in New York City on July 1,” referring to the ACC welcoming Syracuse, Pittsburgh and Notre Dame to the conference. “But there still needs to be a reception. We’re not sure what we’re going to do for that yet, but it’ll be special.“
The notion of Syracuse moving to center court (literally) of the Dome is not authentic; the idea has made its way to the drawing board in the past but has always stayed there.
Unfortunatel,y everyone working on the Hill has a lot has to take into consideration before they pick up the pieces of the court and move them: (1) whether or not the fire marshal gives them the okay for the project, (2) figuring out wiring set up for television crews for a one-time basis, and (3) taking on the challenge of moving season ticket holders and not having any complaints.
The current forced seating arrangement to the one half of the dome makes it feel more intimate and as if it is a full house each game.
Having a single game in the middle of the field you can’t just have fans seated 70 yards back from the end zones of the court. And what about those with courtside seats, especially if they were to decide to play on a raised court?
Would making history and spending the money for one night outshine the hassle?
Duke isn’t the only big named program that the Orange will be hosting this season other teams include North Carolina in an ACC game and Indiana in the ACC/Big Ten Challenge.
Whether or not Syracuse will move the court has yet to be confirmed or denied. The full basketball schedule will be released later this month soon following that tickets will go one sale, which is when we’ll find out whether or not Syracuse will be making history again.
“We’re going to look at all kinds of options to make our move to the ACC as special as possible,” Giansante said Thursday. ‘There are a lot of different things on the table to consider.”
Guest author: Benjamin Haynes, Esq.
University of Miami’s football player Dyron Dye was disciplined back in 2011 by the NCAA when the NCAA concluded that Dye had accepted impermissible benefits from a Miami Hurricane booster. Dye was required to sit out four games and was ordered to repay $738 in impermissible benefits. Now, as a senior, Dye is once again being investigated by the NCAA for potential rule violations stemming out of the same incident. On Tuesday May 28, NCAA investigators met with Dye for the third time. The reason for this third meeting was that the NCAA claimed that there are discrepancies between what Dye told the NCAA in 2011 about former Hurricanes assistant coach Aubrey Hill and what Dye wrote in a recently signed affidavit. Dye’s attorney, Darren Heitner, stated that “my client stands behind the statements he made in his affidavit, which we understand is supported by affidavits signed by other former players.” While Dye has already been penalized for receiving impressible benefits, this new allegation by the NCAA could result in further sanctions against Dye under NCAA Bylaw 10.1.
NCAA Bylaw 10.1 deals with unethical conduct. The rule specifically states that “unethical conduct by a prospective or enrolled student-athlete or a current or former institutional staff member (e.g., coach, professor, tutor, teaching assistant, student manager, student trainer) may include, but is not limited to, the following.” The rule then goes on to list nine separate categories which may constitute unethical conduct. For purposes of this article, the category which the NCAA may potentially try and claim Dye violated is “(d) knowingly furnishing the NCAA or the individual’s institution false or misleading information concerning the individual’s involvement in or knowledge of matters relevant to a possible violation of an NCAA regulation.” Dyron Dye’s discrepancies between his recent affidavit and 2011 statements could potentially constitute a violation of knowingly furnishing the NCAA with false and misleading information. However, these may be some valid defenses to these alleged discrepancies.
Dyron Dye wrote in his statement that he felt that the NCAA had twisted his testimony. In fact, many of the current and former Miami Hurricane football players that were interviewed by former investigator Rich Johanningmeier stated that the NCAA used means of intimidation and threats while interviewing the players. Those alleged threats, according to Dye’s affidavit, were threats of penalizing the players by making them ineligible and pulling their scholarships. If such allegations are found to be true, then the NCAA could potentially be sued for extortion.
Under Florida law, specifically Florida Statute 836.05, whoever maliciously threatens to accuse another of any crime or offense, or by such communication maliciously threatens an injury to the person, property or reputation of another, or maliciously threatens to expose another to disgrace, or to expose any secret affecting another, with intent thereby to extort money or with intent to compel the person so threatened to do any act or refrain from doing any act against his or her will, they shall be guilty of a felony of the second degree.
Therefore, under this Florida statute, Dye may be able to argue that the NCAA maliciously threatened, against Dye’s will, to injure his property or reputation if Dye did not testify in a manner consistent with what the NCAA was directing. In fact, Dye stated that he “felt compelled to testify in a manner that would be consistent with the manner in which Mr. Johanningmeier was directing me in order to keep my eligibility.” One would think that the NCAA’s primary goal in conducting such an interview would be to get the absolute truth of the situation, and not stoop to the means of threatening teenagers and young men in order to have facts twisted in the NCAA’s favor.
It is expected that more former Hurricane players involved in this incident will come forth and state that the NCAA threatened scholarships and eligibility to them as well. The more players that come out and corroborate Dye’s testimony, the stronger case Dye will be able to build when defending himself amidst a 10.1 ethical violation allegation, and potentially seeking an extortion cause of action against the NCAA.
Benjamin Haynes, Esq. wrote this article. Haynes is a former Division 1 Basketball Player at Oral Roberts University and currently practices law in the State of Florida. Follow him at @BHaynes32.
A number of Division I conferences have recently increased the fees a member school must pay when it withdraws from the conference. These fees are commonly referred to as exit fees. The ACC is one of the conferences that recently increased its exit fees. And its exit fee provision has been receiving a lot of attention lately because of Maryland’s departure to the Big Ten.
The ACC actually increased its exit fees twice in the span of a year. The ACC first upped the fees from around $12-14 million to $20 million in September 2011 when it announced it would add Syracuse and Pittsburgh. The fees were then upped again this September after the conference added Notre Dame (in all sports except football and hockeyl).
The ACC’s current exit fee calls for a withdrawing member to pay an amount equal to three times the conference’s total operating budget at the time of withdrawal. Based on the ACC’s 2012-13 operating budget, this equates to an exit fee of more than $52 million. It is this amount that the ACC is seeking in its lawsuit against Maryland for the school’s move to the Big Ten.
When the ACC and other conferences increase their exit fees, the general thinking is that it further discourages members from leaving the conference. But, because of how courts analyze the legality of these exit fee provisions, increasing the amount of the fee can actually increase the chances of the exit fee provision being deemed unenforceable. So, instead of discouraging schools from leaving, it can actually embolden them to do so.
In legal terms, conference exit fees are known as liquidated damages. Liquidated damages provisions are commonly added to contracts. They set the amount a party to the contract must pay in the event it breaches the contract. Liquidated damages provisions are useful because they theoretically save the parties the time and expense of litigating the amount of damages caused by the breach.
But, the amount of liquidated damages specified in a contract cannot be randomly selected. Courts will generally only enforce liquidated damages provisions if (1) the anticipated damages in the event of a breach are difficult to ascertain at the time of contracting, and (2) the amount of liquidated damages is a reasonable estimate of the actual damages that would likely be caused by a breach. If a liquidated damages provision does not meet this test it is deemed a penalty and is unenforceable.
Assuming that the ACC’s liquidated damages provision fulfills the first element of the test, it is questionable whether it would meet the second element. The requirement to pay three times the conference’s operating budget does not appear to be related in any way to the actual amount of damages the ACC would suffer if a member withdraws. It just seems like an easy way to ensure that the exit fee continues to grow without having to continually vote on it. This makes it look like a penalty.
And the actual number that results from this provision, $52 million, is not a reasonable estimate of the ACC’s actual damages. For example, Maryland’s departure will not result in the ACC’s tv deal being reduced by $52 million. A good argument can be made that the ACC actually suffered no damage when Maryland left. Maryland’s departure allowed the conference to add Louisville. And the general consensus is that the ACC is now stronger athletically as a result (at least in the two sports that matter for tv revenue purposes, football and men’s basketball).
This is consistent with recent realignment history. Over the past two years the Big 12 lost Nebraska, Colorado, Texas A&M, and Missouri. Yet, after adding TCU and West Virginina, the Big 12 signed the most lucrative tv deal in the conference’s history this year. (The one exception to the no damage upon withdrawal argument would be the Big East. The defections in that conference have definitely hurt the value of its tv rights).
When a liquidated damages provision is determined to be invalid, the party attempting to enforce the provision is allowed to instead seek its actual damages from the breaching party. But, as discussed above, conferences often suffer minimal damage when a member withdraws, either because the member added little value to the conference or because the conference quickly replaces it with a new member of equal value (at least in tv executives’ eyes).
As a result, exit fees often leave conferences in a tough position. They have to be high enough to discourage a member from leaving the conference. But, if they are too high they could be declared an invalid penalty. And, if the exit fees are invalid, the conference would then have to prove its actual damages, which are usually much less than the amount of the exit fee. As a result, exit fee disputes have always settled without a court deciding the validity of the liquidated damages provision. Recent examples include the Big 12 settling with Nebraska, Colorado, Texas A&M, and Missouri for less than the mandated amount of exit fees.
So, what is the solution to the problems with exit fees? Grants of television broadcast rights. In these agreements, all of the conference members grant their television broadcast rights to their athletic contests to the conference for a certain period of time. If a member leaves the conference during that time, the conference retains the member’s television rights. Because the value of a school to a conference is the television revenue it can help generate, a grant of rights agreement makes the members essentially worthless to another conference that is looking for new members.
While grant of rights agreements do have potential issues (sovereign immunity issues being the biggest), they are not subject to a subjective test like liquidated damages provisions. Thus, they are much more likely to hold up in court as valid contracts.
Currently, only the members of the Big Ten, the Pac-12, and the Big 12 have executed grant of rights agreements. Other conferences that want to ensure stable membership would be wise to insist on their members signing similar agreements. (Yes, even the mighty SEC should have its members sign grants of rights). If the ACC had one in place, Maryland likely would not be joining the Big Ten.
BY: LAURA STRAUB
University of Miami fans might be content with the team’s 4-4 start this season, but problems off the field, in particular scandals within the booster program in the past two years, have the potential to plague the success of the program. As with most private universities, Miami’s sports programs are supported through financial support from alumni, professional players, professional businesses and fans, but this system of funding was rocked in the wake of the Nevin Shapiro scandal.
The scandal, which broke during 2010 and 2011, came in the form of a Yahoo Sports Report. The report, complied and written by Charles Robinson implicated over 70 current and former Hurricanes players and coaches for numerous NCAA violations including illegal recruitment tactics such as prostitutes, strip clubs and expensive dinners.
The epicenter of the scandal fell on former Miami University booster Nevin Shapiro and his Ponzi scheme. Through his Ponzi scam, he swindled investors out of over $900 million. Shapiro is now imprisoned and out of the picture; however, this situation has left many questioning whether Miami University will still be able to raise as much money for their athletic programs as they had prior to the scandal.
The University of Miami booster program, The Hurricane Club, has rallied in the face of this scandal and has not only surpassed the 2011 membership mark, but has reached its membership goal of 5,500. The Hurricane Club is celebrating its 40th anniversary with the additional goals of raising scholarship support to $10.1 million and upping participation in their 40/40 program to 40 percent.
Membership in the Hurricane Club can be attained through the purchase of priority seating for either the University of Miami football or basketball games or by an outright annual donation. The annual donation can be made at six different levels with dollar amounts ranging from $40 to $30,000. Annual donations come with an assortment of perks, including lapel pins and car decals, priority to purchase tickets for rivalry and bowl games, and priority seating.
Although Shaprio is currently in prison over his unethical involvement with Hurricane Club funds, the program has had a successful year in reaching their funding goals, evidently showing the significant impact a winning record has in terms of fundraising.
However, attendance at Hurricane’s home football games does not seem to compliment the team’s nor the booster program’s recent success. According to CBS Sports, attendance at the Hurricane’s home opener was 39,345 fans. Yet, a picture taken by Tim Reynolds of the Associated Press from the press box in the second quarter shows an unsettling ratio of empty orange seats to excited fans.
It seems only logical that the success of an athletic program could impact fundraising efforts. This money would go towards more program improvements. Nevertheless, the question of whether or not the fans are overlooking the success of the team because they are disenchanted by the Nevin Shapiro scandal remains to be answered.
BY: CAITLYN LAWRENCE
Duke is a school that prides itself on excellence in education, leadership opportunities, research, and athletics. In athletics, this excellence has been expressed by having won 12 NCAA championships. Now, in effort to continue this legacy, Duke has started the “Duke Forward” campaign, an initiative to raise $3.25 billion for the university from now until June 30, 2017. Of this $3.25 billion, the Duke athletics department is looking to raise $250 million that will help change the face of Duke Athletics by addressing the need for restructuring certain athletic facilities.
Perhaps these goals for change could not be coming at a better time as Duke is facing low attendance at their home football and basketball games. During the 2011 football season, an average of 24,393 tickets were sold per game, translating into only 71.87% of the stadiums full seating capacity. This was the lowest football attendance in the Athletic Coast Conference and ranked Duke 79th in attendance for the nation. Maybe this is expected, with the Duke Football program on the decline; they have not won a conference championship since 1989 and their last winning season was in 1994.
However, Duke’s basketball attendance should be a different story considering its success. Duke has reached the Final Four fifteen times, appeared in 10 championship games and has won four NCAA championships, the most recent being in 2010. Yet over the past five years, student attendance at their games has dropped, causing the athletics department to increase the sale of general admission tickets to fill the student section at Cameron Indoor Stadium. Is it possible that facility changes could increase the popularity of Duke athletics?
The changes planned are not only geared towards the high revenue sports, mainly football and basketball. Duke is hoping to help every student-athlete through these advancements. The first stage of the plan is to help Olympic sport student-athletes by building a new track stadium. This stadium will include a new track allowing them to remove the current track that surrounds the field at the Wallace Wade Football Stadium. This new facility will also include an infield with sport-specific throwing lines, grandstands, and a press box.
The development of a new track stadium will also help with the transformation of the Wallace Wade stadium. By moving the track to a separate facility, they can remove the track from around the football field, allowing them to lower the field and extend the stands closer to the action. The current press box will also be removed and a new tower will be built that will include premium seating. With these changes, it is expected that the capacity of Wallace Wade will increase from the current 33,941 seats to 43,915.
Since Duke is already having trouble filling the stands, they have said that they do want to wait to complete the expansion at Wallace Wade until they are sure that game attendance will consistently have almost 44,000 people. This will require immense football growth; growth that usually comes from Championship success. Perhaps Duke is looking to create that success this year. They are starting with a current record of 4-1, the best Duke start since 1994. Furthermore, they beat Wake Forest for the first time since 1999. Both of these are indications that there is a change in the atmosphere of Duke Football that could potentially boost its attendance and popularity.
As for the Cameron Indoor Stadium, no changes are being made to the seating. However, Duke plans to construct a connected grand entrance to the football and the basketball stadiums. This includes a three-story pavilion that will include ticket offices and a team store for the public, but also offices for the athletic department, new training rooms, and a weight room for Olympic sport student-athletes. In addition, Cameron will have new locker rooms and player/coach facilities, plus a new special access club room, and a Legacy Room.
The Duke Forward campaign is looking beyond facility enhancements and is also hoping to increase Duke’s athletic endowment. Currently, about 30 percent of their athletic scholarships are endowed, but there is hope that by the end of the fundraising campaign this percentage will rise to 35 percent. Duke is also hoping to raise $100 million for operating expenses to help cover a wide range of expenses, from un-endowed scholarships to equipment maintenance.
If these changes are made possible, will the face of Duke Athletics be changed? It is very likely! With the excitement associated with facility enhancements, it is possible that the school will see a renewed spirit. As the school grows not only on the athletic side, but also in the world of academics and research, new pride will be fostered and will hopefully be expressed by supporting Duke Athletics. This will hopefully lead to increased home game attendance and increased revenue for the institution. These changes may even lead to more NCAA championships. More student-athletes may look to attend this institution after seeing the emphasis put on success in athletics. The wait won’t be long to see if the changes will help move “Duke Forward” since they hope the first changes will be implemented in the spring of 2013.
Today’s news that Notre Dame is leaving the Big East for the ACC surprised many. Similar to its arrangement with the Big East, all of Notre Dame’s sports will compete in the ACC, save for its football program which will remain independent. The one difference from its membership in the Big East, though, is that Notre Dame football will be able to compete in the ACC’s non-BCS bowl games. Given that the Big East is the only conference of the six BCS AQ conferences that does not have a bowl set aside for its conference champions, this is a significant perk for Notre Dame. This perk, along with Notre Dame’s financials depict why the school’s transition from the Big East to the ACC is a logical move.
After months of watching the conference realignment carousel turn, there is no question that finances drive schools from one conference to another. There are several components to the finance issue at play when a school chooses to switch conferences. First, is how much money the school can bring in from the respective conference. Second, is how the respective school’s athletic department’s finances stack up against other athletic departments in the conference.
Notre Dame will undoubtedly reap more revenue from ACC membership than it does from its current Big East membership. The timing of Notre Dame’s decision is arguably not coincidental: Its current conference is in the midst of a 60-day exclusive TV rights negotiation process with ESPN. The outcome of those negotiations will shape how lucrative of a new television deal the Big East obtains. Given that Big East basketball powerhouses Syracuse and Pitt recently defected the conference for the ACC, the conference’s bargaining power has arguably decreased. Take away Notre Dame on top of that, and the Big East’s bargaining power has dramatically shifted. In contrast, Notre Dame is joining a conference which in May, negotiated a $3.6 billion year television rights contract through 2026-27. Prior to Notre Dame’s addition, it was expected that ACC members would capture $17.1 million per year from the television contract. The addition of Notre Dame, however, will likely increase that figure. It is likely that the recent television contract contains a term allowing it to be modified upon the addition of a new conference member. Given Notre Dame’s national popularity, this will likely drive the price of the contract up, and as such, put more money in each ACC school’s pocket. The realization that it will earn more per year in television revenue as an ACC member than as a Big East member was likely a driving factor in Notre Dame’s decision to move conferences.
As noted above, an athletic department’s financial health is another factor schools take into consideration when moving conferences. A school must be able to expend and bring in a similar amount of revenue as its competitors in order to remain competitive. In terms of the ACC, Notre Dame is on similar footing to its competitors. According to data submitted to the Department of Education, in 2010-11, Notre Dame had the sixth-highest net income of all Division I athletic departments. That same year, the ACC school with the highest net income was Virginia, whose net income was just over $13 million less than Notre Dame’s. The control of its budget puts Notre Dame on strong footing as it enters the ACC.
Similarly, Notre Dame’s spending is comparable to ACC members’ spending. Per data submitted to the Department of Education, in 2010-11, Florida State’s athletic department spent the most of any ACC institution at $86,946,503.00. While Notre Dame’s expenditures were more than $11 million less than that, the athletic department’s $75,360,209.00 worth of expenses were still sizable. In fact, Florida State was the only ACC institution that out-spent Notre Dame in 2010-11.
Overall, entering the ACC is a victory for Notre Dame. First and foremost, it achieved a coup by keeping its independent status in football. Secondly, it gained access to greater TV revenues by partnering with a conference that is home to a more lucrative television rights deal. Finally, Notre Dame will be on more equal financial footing with its ACC competitors than it was with other Big East members.
With the current BCS contract set to expire at the end of the 2013 season, the landscape of college football is set to change in the coming months. In the last few weeks, the SEC and Big 12 announced that they will be creating their own bowl game, in which each conference’s champion will play, beginning in 2014. While it is unclear what this new bowl game means to the Fiesta Bowl (in which the Big 12 champion currently plays) and the Sugar Bowl (in which the SEC champion currently plays), it is possible that both of those bowls could continue to exist after 2014. Additionally, the bowl would likely be joining the Rose Bowl (played by the Big Ten and Pac-12 champions) and the Orange Bowl (played by the ACC champion).
Furthermore, it is expected that in coming months, BCS commissioners will vote to approve a four-team playoff system as a modification to the current BCS system. This four-team playoff will pit the number-one and number-four seeds and the number-two and the number-three seeds in two playoff games before contending for the National Championship game.
Given that beginning in 2014, the SEC and Big 12 champions will meet in a bowl game as will the Pac-12 and Big champions, while four teams compete for the opportunity to play in the National Championship game, should the Big East and ACC join forces to create their own bowl game?
There are two real reasons for the ACC and Big East to adopt their own bowl game: 1. To ensure that their teams have a national stage to play a bowl game on and 2. To earn revenue.
In considering whether creating a new bowl game is necessary for the ACC and Big East to ensure that their teams play a bowl game on a national stage, one factor to consider is the likelihood of either team’s conference playing in the four-team playoff. A brief overview of the teams ranked number-one through number-four since the founding of the BCS in 1998 provides some guidance as to the likelihood of ACC or Big East teams competing in the four-team playoff set to begin in 2014.
|1998-99||Tennessee||FSU||Kansas State||Ohio State|
|2005-06||USC||Texas||Penn State||Ohio State|
|2007-08||Ohio State||LSU||VA Tech||Oklahoma|
The only current Big East member to have been ranked in the top-four in the college football regular season standings since the founding of the BCS is Cincinnati. Granted, Miami and Virginia Tech were both ranked in the top-four several times during their Big East tenure, however, those teams both play in the ACC now. Thus, when looking at the entirety of teams ranked in the top-four during the BCS’ history, it would appear that the Big East needs a partnership with the ACC, much more than the ACC needs a partnership with the Big East.
However, the fact of the matter remains, that in the last three years, Cincinnati was the only school out of either conference to be ranked in the top-four at the end of the college football regular season. Thus, by creating their own bowl game, the conferences would ensure that their respective champions would be on a national stage during a bowl game after 2014.
Thus, the next question to address, is can the ACC and Big East draw a positive amount of revenue from a bowl game? This question, unfortunately, is not as easy to answer. The ACC and Big East in recent years have been known more so for the talented basketball teams they field than their football prowess. That is not to say, that each team does not have football teams which fans would travel to watch. However, could the conferences find enough fans to travel to a bowl game to ensure its profitability?
Perhaps UConn’s appearance in the Fiesta Bowl in Tempe, AZ is an indicator as to if, and how far, fans are willing to travel for bowl games in which their teams appear. UConn was required to sell 17,500 tickets for the event. Six days before the bowl game, it had only sold 4,600. Reports indicated that the school would incur the cost of the unsold tickets. Would Big East fans be more inclined to travel to bowls closer to home? If so, could such an endeavor be a revenue generator for the Big East and ACC?
While the ACC and Big East could benefit from joining forces to create a new bowl game, they should only do so if it is held at a location in close proximity to the bulk of each conference’s largest fan base. Additionally, the conferences should only enter into a bowl agreement after surveys are completed determining each conference’s fan base’s commitment to paying for and attending the bowl game. If the interest is not strong and definite, then each conference would be better off attempting to compete for one of four-team playoff seeds.
Last week, the ACC and ESPN reached an agreement which extended the network’s television contract with the conference for 15 years. News of the agreement caused many to speculate that FSU would leave the ACC for the Big 12, under the assumption that the amount of money the school would earn under the ACC’s extended media contract was not sufficient and that FSU would be able to earn more under the Big 12′s yet-to-be-negotiated media contract.
However, in a memorandum released today, FSU president Eric Barron all but squashed any rumors of FSU leaving the ACC for the Big 12.
In the memorandum, Barron provided four reasons why alumni believe FSU should consider joining the Big 12: the Big 12 is more football-oriented than the ACC, the Big 12 would give FSU greater football competition, the ACC provides advantages to North Carolina schools, and FSU would earn more media revenue under the Big 12′s media contract.
In response, Barron nearly doubled the reasons why FSU should not join the Big 12, providing seven explanations. These explanations included his notations that the ACC is an equal share media revenue conference while the Big 12 is not, any additional money FSU would receive under a more lucrative Big 12 media rights deal would in turn be spent by FSU on further travel to play Big 12 schools, ticket revenue would decline as Big 12 fans would be less inclined to travel to FSU games, the sellout FSU-Miami rivalry would be lost, FSU would have to pay $20-$25 million to leave the ACC and the Big 12 is an “academically weaker” conference.
While many FSU fans may be disappointed in Barron’s response, his reaction is perhaps the most level-headed of any made during the past 18 months in which conference realignment has changed the collegiate athletics landscape. Barron’s response provided analysis of three of the key factors driving conference realignment: media contract revenues, travel and academics. However, it appears that for once, the lure of media contract revenues did not outweigh the costs posed by travel and academics resulting from conference realignment.
Over the past 18 months, fans of college athletics have watched as teams have realigned themselves with conferences in far away lands, under the auspices of joining the ranks of more prestigious academic institutions, better competition, and ultimately, earning higher revenues. However, in his memorandum, Barron indirectly called out many of these institutions on their bluff: How can you promote academics and earn more revenue, when you are requiring your student-athletes to travel further distances and expending more money to meet a growing travel budget?
In recent months, I have been given great access into top Division-I athletic department’s budgets. Across the board, the highest expense any athletic department incurs is for travel. Athletic departments that compete in localized geographic areas already shell out millions of dollars per year to pay for travel. Imagine how much the amount spent on travel will increase when schools join conferences with geographic reaches across the nation? Will it double? Triple? Will the possibility of earning $2 million more per year under a media rights agreement balance the additional travel costs incurred by the athletic department, while also negating the time lost to study by student-athletes required to travel further distances for competition? Only time will tell.
Today, many may be chastising Barron for his memorandum and apparent disinterest in moving FSU to the Big 12. However, ten years from now, it will be interesting to see what FSU has gained (and likewise, what it may have lost) by remaining in the ACC.
Previously, BusinessofCollegeSports.com showed you which schools spent the most on recruiting per data obtained from the Department of Education. In reporting this data, BusinessofCollegeSports.com noted that imperfections exist within the data, but that the Department of Education data was the only publicly available source listing recruiting expenses for public and private institutions.
After that report was published, BusinessofCollegeSports.com followed up with several schools in an effort to obtain more accurate records of their recruiting expenses. Georgia Tech Athletics’ Chief Financial Officer, Frank Hardymon, graciously detailed Georgia Tech’s recruiting expenses for BusinessofCollegeSports.com
Per data obtained from the Department of Education, Georgia Tech’s recruiting expenses were the 7th highest of all BCS schools in 2010-11. In that year, Georgia Tech had total recruiting expenditures of $1,489,599.00, spending $1,173,904.00 on recruiting for its men’s sports and $315,695.00 on its women’s sports. Georgia Tech’s total recruiting expenditures put it only behind those of Tennessee, Auburn, Notre Dame, Alabama, Georgia and Florida, when comparing data submitted to the Department of Education.
Hardymon was able to provide logical explanations as to why Georgia Tech’s recruiting expenses appeared higher than most other BCS schools. In simplest terms, every school reports things differently. Hardymon explained, “Everybody reports things differently. Every school has different ways of doing accounting, so they show expenses under different categories.”
Additionally, Hardymon explained that the items the Department of Education asks to be reported are not the same as what is required to be reported to the NCAA. Thus, it is possible that a school’s revenues and expenses may appear to be different on each report. “You can end up with two completely different bottom lines, which can lead people to question the quality of your accounting if you have two different totals,” said Hardymon.
Furthermore, according to Hardymon, the Department of Education does not want athletics departments to report losses. Thus, while the Department of Education report depicts many athletics departments having zero net income in 2010-11, it is possible that many of these athletics departments actually suffered a loss in 2010-11. “Their theory is, if you had a loss, you’re still an operating entity, so somebody must have covered it for you. They have us report the loss as if the school floated us the difference,” said Hardymon. For athletics departments like Georgia Tech, which are a separate corporation from their university counterpart, this presents an issue, as the athletics department is solely responsible for any losses it incurs.
Hardymon noted that Georgia Tech is “very inclusive on recruiting” in terms of what the athletics department shows as a recruiting expense on its reports to the Department of Education and NCAA. Part of Georgia Tech’s ability to inclusively report its recruiting expenses, is the result of the accounting system Georgia Tech uses. Hardymon explained, “We are able to code a lot of things as recruiting. So anything—even if it isn’t an immediate recruiting expense, but is going to turn into one, like buying envelopes, stationary and postage to be sent to recruits—is going to be listed as a recruiting expense.”
Georgia Tech’s inclusiveness in reporting its recruiting expenses is likely what made its expenses the seventh-highest of all BCS schools in the Department of Education report. While the Department of Education report only reports recruiting expenses as lump sum numbers, Hardymon provided BusinessofCollegeSports.com with an inside look of what some of the $1,489,599.00 spent by Georgia Tech on recruiting went toward.
First, the football program undertook an initiative to update the materials it distributes externally. “Football makes a pretty strong commitment to communicate in writing with potential recruits,” said Hardymon. According to Hardymon, “this initiative created $300,000.00 in expenses for the Athletic Association, which were categorized in football recruiting.” It is important to note that the entire $300,000.00 was expensed towards recruiting in 2010-11, although some of the materials will be used for years beyond 2010-11. Hardymon asserted that when “office-type expenses,” like the football program mailers were removed from Georgia Tech’s recruiting expenses, Georgia Tech’s recruiting expense total fell below $1 million. Hardymon believes that this number is a more accurate representation of Georgia Tech’s recruiting expenses when compared to those of other programs.
The bulk of Georgia Tech’s recruiting expenses went towards travel costs. In 2010-11, Georgia Tech spent $1,007,897.00 total on airfare, meals, hotels, entertainment, transportation, and development for on and off-campus recruiting. The big-ticket item in Georgia Tech’s travel expenses for recruiting, though, is airfare expenses incurred by both basketball programs and the football program. Hardymon said that while Georgia Tech does use a charter airline company, the company is relatively inexpensive and that the coaches also largely use commercial airlines to travel.
The numbers provided by Hardymon related to Georgia Tech’s recruiting expenses, along with his explanations as to why different athletics department’s expenses may seem vastly different, provided great insight into the budgetary concerns of a top athletics department.