Texas A&M Paying Tab for Ifedi’s Loss of Value Insurance

Schools pick up tab for insuranceLast year, Texas A&M discovered a new use of the Student Assistance Fund, a pool of money created out of revenue from the NCAA men’s basketball tournament and earmarked for student athletes with financial need. The fund has typically been used for expenses like trips home and clothing, but Texas A&M asked for a clarification last year regarding the insurance needs of student athletes and sparked a bit of a new trend when it spent $50,000-60,000 on a loss-of-value insurance policy for Cedric Ogbuehi.

Although disability insurance has been around for student athletes for quite some time, loss-of-value insurance is a newer phenomenon. Loss-of-value insurance pays out if a student athlete falls precipitously in the NFL draft due to an injury.

I wrote an in-depth piece for SportsBusiness Journal last year on this growing trend – which schools have purchased the policies, whether there’s any danger of depleting the SAF through the purchase of these policies and more – that you can read here (they’ve made it public, so you should be able to read even without a subscription).

Now Texas A&M is in the news again, with CBS Sports’ Dennis Dodd reporting the Aggies have purchased a loss-of-value policy for redshirt junior offensive tackle Germain Ifedi.

There are few cases of these policies paying out for student athletes, although former USC student athlete Marquis Lee is currently embroiled in a legal battle with Lloyd’s of London over his policy and the injury that led him to drop in the 2014 NFL Draft.

Want to learn more about loss-of-value insurance and how the SAF has been used previously to purchase policies, please read my article for SportsBusiness Journal.

College Athletics Construction Roundup: July 2015

College Athletics Construction RoundupThe “College Athletics Construction Roundup” is a monthly series on the construction of intercollegiate athletics facilities. Each month we’ll provide a list of announced, in progress and recently completed athletic construction projects from around the country. You can view previous editions of the “College Athletics Construction Roundup” here.

Master Plan

Louisville’s Board of Trustees approved a capital plan that includes a $55 million expansion of Papa John’s Cardinal Stadium. The capital plan is a wish list and does not necessarily indicate construction is imminent. The school is continuing to explore expansion feasibility for the stadium.

Several athletic projects are included in Bryant University’s $75 million capital campaign. The projects include a 78,000-square-foot indoor practice facility, 10,000-square-foot strength and conditioning center and a resurfaced outdoor turf and track.

West Virginia has several athletic projects in the pipeline, covering several sports. Projects include a new surface for the outdoor practice field, new turf for Mountaineer Field, concourse renovations, locker room renovation for men’s basketball and facilities for the new golf program. Continue reading College Athletics Construction Roundup: July 2015

Comparing Apparel and Licensing Contracts in College Sports

Comparing Licensing Agreements in College AthleticsIf you follow college sports at all, you probably noticed Tennessee’s move from Adidas to Nike last week. Many of you would probably be surprised to learn the cash value of Tennessee’s new Nike deal is less than the cash received under its Adidas deal. Why, then, would Tennessee make the switch? Is the Vols brand trending downward?

It’s definitely not the latter. Tennessee was ranked #12 in the nation on Collegiate Licensing Company’s last set of rankings. CLC represents over 200 collegiate properties, including the vast majority of schools in the Power Five conferences (although Fermata Partners has made a splash in the marketplace over the past year with the addition of Kentucky, Georgia, Oregon, Miami and, most recently, Notre Dame). At the end of the 2012-2013 fiscal year, Tennessee ranked #15 on CLC’s list, so the brand has, in fact, not degraded.

Revenue = Cash + Product + Royalties

The answer to the Tennessee question really lies in the differences between Adidas and Nike and their contracts. Continue reading Comparing Apparel and Licensing Contracts in College Sports

Moneyball Comes to Nebraska Athletics

Nebraska MoneyballIf you enjoyed Moneyball (and, yes, I liked it before Brad Pitt’s adaptation on the big screen) you may be in favor of Nebraska’s latest move: hiring a Director of Sports Analytics and Data Analysis.

According to a press release issued by Nebraska, Tucker Zeleny, a recent PhD grad from Nebraska, will don that title going forward. Zeleny is a Nebraska graduate, completing his doctorate in statistics this past May. His dissertation focused on weigh lifting data collected by the Husker football team.

Zeleny will head a new department within the Huskers’ athletic department, which will work with all 24 of Nebraska’s sports to “collect, analyze and summarize data related to team and individual performance.” The team will also spend some time collecting data and analyzing it in relation to how the athletic department operates as a whole.

“I am excited that Tucker has joined the athletic department and will be leading this newly created department,” said Steve Waterfield, Senior Associate Athletic Director for Performance and Strategic Research. “I have been impressed not only with Tucker’s analytical skills, but also with his ability to apply these skills in a practical, effective manner that gives Husker sports teams a competitive advantage.  Our sports teams and departments stand to benefit significantly from the information Tucker and his staff will provide.”

“I’m very excited to be joining the athletic department,” Zeleny said. “Sports analytics is becoming a hot area. There is a ton of data out there right now and with new sport technology being made available seemingly every day, there will only be more. Any additional information or advantage we can provide to the various coaching staffs, and to the department in general, is a huge positive.”

College Athletics Construction Roundup: June 2015

College Athletics Construction RoundupThe “College Athletics Construction Roundup” is a monthly series on the construction of intercollegiate athletics facilities. Each month we’ll provide a list of announced, in progress and recently completed athletic construction projects from around the country. You can view previous editions of the “College Athletics Construction Roundup” here.

Master Plan

UTEP will be installing artificial turf on three playing surfaces. Football facilities to receive the new turf are Glory Field, the football practice field, and the Sun Bowl. University Field, the soccer venue, will also receive new turf. All three surfaces should be installed before football begins practice in August.

Southern University began construction on its new Jaguar Park facilities. The $500,000 project is broken down into two phases. Phase 1 includes resurfacing the football field and is expected to be complete by August. Phase 2 includes a field house, concession stand and bleachers for the soccer program.

As part of a master building plan on the campus, Bryant University will build a new strength and conditioning center and indoor practice facility. The IPF will be a 78,000-square foot facility with a full 100-yard turf field. Continue reading College Athletics Construction Roundup: June 2015

College Athletics Construction Roundup: May 2015

College Athletics Construction RoundupThe “College Athletics Construction Roundup” is a monthly series on the construction of intercollegiate athletics facilities. Each month we’ll provide a list of announced, in progress and recently completed athletic construction projects from around the country. You can view previous editions of the “College Athletics Construction Roundup” here.

Master Plan

Ball State raised more than $20 million for use towards six projects benefiting nine teams. Upgrades and renovations will or have taken place at the following facilities: Ronald E. and Joan M. Venderly Football Team Complex, Worthen Arena, Ball Diamond and the golf practice facility at Delaware Country Club.

William & Mary released a report outlining what will be needed for future success of its athletic programs. Among the $125 million worth of facility needs are a new multi-sport indoor facility and the renovation or replacement of both the swimming facility and William & Mary Hall.

Sam Houston State will install new scoreboards in three facilities: Bowers Stadium, Johnson Coliseum and Bearkat Softball Complex. The Bowers Stadium LED scoreboard is expected to be the largest in FCS. All work should be completed in time for the 2015-2016 seasons.

Continue reading College Athletics Construction Roundup: May 2015

College Football Playoff Revenue Makes Every Conference Richer, Except One

College Football Playoff, College Football Playoff RevenueWhich conferences benefitted the most from the transition to the College Football Playoff?

It depends on how you look at it.

The Mountain West saw the largest percentage increase in revenue from $3.6 million to $23.5 million, a 553 percent increase. It was the Pac-12, however, who saw the largest increase in pure dollar and cents with a $41.4 million increase.

Click here to continue reading my piece on Outkick the Coverage on FoxSports.com.

Full conference-by-conference financials for the College Football Playoff vs. the Bowl Championship Series now available here.

College Athletics Construction Roundup: April 2015

College Athletics Construction RoundupThe “College Athletics Construction Roundup” is a monthly series on the construction of intercollegiate athletics facilities. Each month we’ll provide a list of announced, in progress and recently completed athletic construction projects from around the country. You can view previous editions of the “College Athletics Construction Roundup” here.

Football

Oklahoma regents approved a two-phase renovation to the Gaylord Family-Oklahoma Memorial Stadium. The $160 million Phase I will increase capacity to over 84,000. The new south end zone will feature additional suites, loge boxes and club seating.

Oklahoma Memorial Stadium Reno
Rendering for Oklahoma Memorial Stadium renovation : south end zone interior. See more at gmofs.com.

Iowa State will install a new LED video board and ribbon displays in Jack Trice Stadium. The video board will be 36’ high by 79’ wide. Work will be completed this summer.

Virginia Tech’s indoor practice facility remains on schedule for a July 1 completion. The $21 million facility will accommodate soccer and lacrosse in addition to football.

Nevada has begun its final push to raise $4 million needed for a new video board and sound system at Mackay Stadium. The school has set a May 1 deadline for the funds to be raised for the work to be completed in time for the 2015 football season. Continue reading College Athletics Construction Roundup: April 2015

College Athletics Construction Roundup: March 2015

College Athletics Construction RoundupThe “College Athletics Construction Roundup” is a monthly series on the construction of intercollegiate athletics facilities. Each month we’ll provide a list of announced, in progress and recently completed athletic construction projects from around the country. You can view previous editions of the “College Athletics Construction Roundup” here.

Football

Auburn trustees approved $13.9 million for a new video board and electronic ribbons along the upper deck of Jordan-Hare Stadium. The video board is expected to surpass Texas A&M’s as the largest collegiate video board in the nation.

Syracuse is exploring its options on the Carrier Dome. With local and state officials unable to agree on a new downtown stadium project, school officials will need to make a decision on the future of the dome: whether to replace the dome roof in the next 6 – 8 years (at an expected cost of $25 million), replace the roof while making other building improvements, or building a new stadium.

ULM football facility
Proposed ULM end zone facility

The University of Louisiana Monroe approved a new end zone facility at Malone Stadium. The 11,675 square-foot facility will house a new locker room for the football team and new coaches’ offices with patios overlooking JPS Field. Continue reading College Athletics Construction Roundup: March 2015

Obama Wants to End Tax Deduction for Donations to College Athletics

Obama wants to end tax deductionsThe new budget President Obama sent to Congress this week calls for an end to tax deductions for donations made to college athletic departments for season tickets or preferential seating, also known as seat-related contributions. Currently, 80 percent of these donations are tax deductible.

The administration claims people would pay an additional $2.5 billion in taxes over the next decade with this change.

No doubt, college athletics administrators will watch this development closely. Donations are the highest source of revenue in virtually every athletic department. Yes, even higher than those television contracts you hear so much about.

Here is a random sampling of schools throughout FBS to give you an idea of the revenue they generate from donations compared to their total distribution from their conference (television contract, championships, etc.) and the NCAA (March Madness):

School Donations NCAA + Conference Distribution
Alabama $34,233,035 $23,855,929
Louisville $28,935,662 $15,349,134
Michigan $31,285,461 $27,845,239
Texas $37,386,271 $21,740,373
Western Kentucky $3,379,547 $1,634,776
Utah State $2,962,548 $1,888,296
Central Florida $5,088,098 $3,333,291
Source: Reports filed by schools with the NCAA for the 2012-2013 school year
The numbers above include all contributions reported for the year, not just donations made as required for season tickets or preferential seating. However, those seat-related donations account for the majority of donations on a year-to-year basis according to the development folks I’ve interviewed.
Would fans still donate if they no longer received that 80 percent tax deduction? One athletic director told me for my book Saturday Millionaires a couple of years ago that he thought donations would drop by as much as half without the deduction.
Would fans really be willing to give up their seats and all the years of points they’ve built up if they weren’t getting the tax deduction? I’m sure there would be some at the lower end of the scale who might not see it as such a good investment anymore, but I’m not wholly convinced it would have a major impact on giving.  I’d love to hear from those of you working in development in the comments section!
As a side note, Obama’s budget plan also calls for an end to the use of tax-exempt bonds to build facilities for professional sports teams. The plan states debt to finance those facilities would be taxable if 10 percent or more of the facility is used for a private business (i.e., a professional sports team). Implementation is projected to be worth $542 million in tax revenue over ten years.
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