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BCS Payouts vs. March Madness Payouts

Quite frequently in the debate over the BCS there are comparisons to March Madness. Proponents of moving to a playoff system point to the approximately $771 million a year (beginning in 2011) March Madness generates in television alone (previously an average of $545 million). Meanwhile, the BCS bowls will generate just $125 million beginning in 2011 (previously$96.4 million per year ).

While it’s true March Madness generates more television revenue overall, that doesn’t necessarily mean more money for each athletic department. A total of $452,200,000 was distributed by the NCAA in 2010-2011, and less than half of all monies distributed went back into the athletic department with no strings attached (via the Basketball Fund). Here’s the breakdown:

Basketball Fund ($180,467,000): Monies are distributed based on a six-year rolling period. Institutions receive one unit for each appearance, not including the championship game. Each unit was worth $239,664 in 2010-2011.

Academic Enhancement ($22,461,000): Each Division I institution gets $66,000 to use for academic support service for student-athletes.

Conference Grants ($8,115,000): Each conference receives $261,744 less an agreed upon amount remitted to the regional officiating advisors program. Funds must be used to improve officiating, enhance conference compliance and enforcement programs, drug abuse education, enhancement of opportunities for ethnic minorities, and development of gambling education programs.

Sports Sponsorship Fund ($60,155,000): Each school’s share is determined based on the number of varsity sports sponsored. Points begin with the 14th sport (the number required in Division I), and $30,091 is distributed for each sport above thirteen. These monies may be directed to individual institutions or to the conference for distribution, as decided upon by each conference.

Grants-In-Aid Fund ($120,309,000): Each school’s share is determined based on the number of grants-in-aid awarded. These monies may be directed to individual institutions or to the conference for distribution, as decided upon by each conference.

Student Assistance Fund ($59,738,000): This fund also consists of the Special Assistance Fund and the Student-Athlete Opportunity Fund. For the Student Assistance Fund, all athletes are eligible to receive these funds, even if they have exhausted eligibility or no longer participate due to medical reasons. These monies are distributed to the conference who decides how to allocate. This fund is to be used to assist student-athletes with financial needs that “arise in conjunction with participation in intercollegiate athletics, enrollment in an academic curriculum or that recognize academic achievement. The Student-Athlete Opportunity Fund is distributed by conferences based on the formula used for sports sponsorship and grants-in-aid. The Special Assistance Fund is to be used to meet student-athlete financial needs of an emergency or essential nature for which other financial aid is not available.

Supplemental Support Fund ($955,000): Used to support campus-based initiatives designed to foster student-athlete academic success at eligible limited resource institutions.

At the end of the day, most conferences receive larger payouts from the BCS than March Madness when it comes to money going back into the athletic department with no strings attached. Below is a look at the payouts for the past four years. Totals in red reflect conferences who received a larger payout from basketball than football for the given year. You should also note the football payouts indicated for the non-AQ conferences (Mountain West, Mid-American, Sun Belt, C-USA and Western Athletic) are based on the payout from the BCS before the agreement between the conferences to split BCS money equally between all non-AQ conferences kicks in. Also, these numbers do not include payouts for non-BCS bowl games.

ACC 2006-2007 2007-2008 2008-2009 2009-2010
Football $18,088,675 $18,324,992 $18,672,725 $19,787,058
Basketball $14,149,120 $15,090,053 $15,863,538 $18,220,902
Difference  $3,939,555 $3,234,939 $2,809,187 $1,566,156
         
Big 10 2006-2007 2007-2008 2008-2009 2009-2010
Football $22,588,675 $22,824,992 $23,172,725 $24,287,058
Basketball $13,087,936 $13,561,946 $13,803,338 $15,332,222
Difference $9,500,739 $9,263,046 $9,369,387 $8,954,836
         
Big 12 2006-2007 2007-2008 2008-2009 2009-2010
Football $18,088,675 $22,824,992 $23,172,725 $19,787,058
Basketball $14,325,984 $15,663,093 $16,275,578 $17,109,871
Difference $3,762,691 $7,161,899 $6,897,147 $2,677,187
         
Big East 2006-2007 2007-2008 2008-2009 2009-2010
Football $18,088,675 $18,324,992 $18,672,725 $19,787,058
Basketball $14,856,576 $16,618,160 $19,365,880 $23,109,436
Difference $3,232,099 $1,706,832 ($693,155) ($3,322,378)
         
Pac 10 2006-2007 2007-2008 2008-2009 2009-2010
Football $18,088,675 $18,324,992 $18,672,743 $19,787,058
Basketball $11,849,888 $12,606,880 $13,391,298 $14,665,604
Difference $6,238,787 $5,718,112 $5,281,445 $5,121,454
         
SEC 2006-2007 2007-2008 2008-2009 2009-2010
Football $22,588,675 $22,824,992 $23,172,725 $24,287,058
Basketball $13,087,936 $14,708,026 $15,657,518 $15,110,015
Difference $9,500,739 $8,116,966 $7,515,207 $9,177,043
         
Mountain West 2006-2007 2007-2008 2008-2009 2009-2010
Football $3,529,600 $3,724,000 $9,788,800 $9,878,710
Basketball $3,183,552 $4,011,280 $4,120,399 $3,999,710
Difference $346,048 ($287,280) $5,668,401 $5,879,000
         
Mid-American 2006-2007 2007-2008 2008-2009 2009-2010
Football $1,964,800 $1,508,000 $2,094,400 $2,139,355
Basketball $1,945,504 $1,910,133 $1,442,140 $1,333,237
Difference $19,296 ($402,133) $652,260 $806,118
         
Sun Belt 2006-2007 2007-2008 2008-2009 2009-2010
Football $1,443,200 $2,062,000 $1,529,600 $1,559,570
Basketball $1,061,184 $1,146,080 $1,854,180 $2,222,061
Difference $382,016 $915,920 ($324,580) ($662,491)
         
C-USA 2006-2007 2007-2008 2008-2009 2009-2010
Football $2,486,400 $2,616,000 $2,659,200 $2,719,140
Basketball $7,782,016 $8,213,573 $9,064,879 $8,507,523
Difference ($5,295,616) ($5,597,573) ($6,405,679) ($5,788,383)
         
Western Athletic 2006-2007 2007-2008 2008-2009 2009-2010
Football $9,008,000 $9,170,000 $3,224,000 $7,798,925
Basketball $3,006,688 $3,247,227 $3,090,300 $3,110,886
Difference $6,001,312 $5,922,773 $133,700 $4,688,039

I think it’s interesting to note that AQ football conferences are bringing in more from March Madness than non-AQ football conferences. Some of that has to do with the smaller size of some of the non-AQ conferences, but it’s still rather sizeable disparity. Nonetheless, I imagine people still find the March Madness system more digestible because it is a playoff system and because payouts are based on number of appearances.

Special thanks to my research assistant Eric Heckman for helping me compile the data.

Appearance on WTSP re: USF Student Fees

Thanks to Noah Pransky (@NoahPransky) of WTSP for interviewing me for his piece on USF student fees yesterday! Here’s the video:

http://www.wtsp.com/video/default.aspx?bctid=931443933001

And here’s Noah’s well-written piece on the story:

TAMPA, Florida – For most, it’s been four years of hard work, studying, and sacrifices.  But one thing many of the 5,700 graduating seniors at the University of South Florida never learned was how much of their money was going toward the growing athletic department.

By the time the average senior walks across the stage to get his or her diploma this week, he or she will have paid more than $1,600 to the USF Athletics Department through student fees.

Each student currently pays $13.73 per credit hour to the athletics department, more than the $11.28 that goes toward student activities and the $9.30 that goes toward student health.  Undergraduates need at least 120 credit hours to graduate.

All told, student fees make up $14.5 million of the university’s $34.9 million athletics budget, or 42% in budget year 2010-2011.

In the 2009-2010 budget, student fees made up only 33%, but it was still the largest total of any school in the six major conferences:

  1. USF (33%)
  2. Virginia (15%)
  3. UConn (15%)
  4. Rutgers (13%)
  5. Miss St. (10%)

“This is not unusual,” said Kristi Dosh of The Business of College Sports.  “(Most) sports lose money and football and men’s basketball have to make up for it along with alumni contributions and student fees.”

But at USF, she said, the football and men’s basketball programs are only turning profits of $4 million and $1 million, respectively, so student fees have to balance the budget.

Dosh added that many Florida public schools in smaller conferences relied even more heavily on student fees in the last full budget year, 2009-2010 (student fees as percentage of total athletics budget in parenthesis):

  1. FIU (71%)
  2. FAU (55%)
  3. UCF (44%)
  4. USF (33%)
  5. FSU (9%)
  6. UF (2%)

At the University of Florida, the football program turns a $44 million profit annually – more than the entire USF budget for all sports.  Alumni donations were also plentiful at UF.

USF alumni contributions were minimal, Dosh said.

“I’ve talked to a number of different athletic departments in similar positions (as USF),” Dosh said.  “The hope is that in the future, as their program grows and their football team gets stronger, alumni will step up and shoulder more of the burden.”

Dosh said USF revenue has soared since joining the Big East and should continue to grow, potentially easing the reliance on student fees.

And officials at USF pointed out students that pay the fees have access to free tickets to all events, including the largest football allocation in the Big East. 

Dosh and university officials both said a successful athletics program helps boost a university’s reputation as well as its academics.

“If the university has certain accolades and is well-known across the country,” Dosh said, “it can apply for research grants and other things…it can lift the whole school up.”

Connect with 10 News reporter Noah Pransky on Twitter at www.twitter.com/noahpransky, Facebook at www.facebook.com/noahpransky, or on his Sports Business blog, Shadow of the Stadium.

I’ll only add a few things to his story. Although UCF funds their athletics budget with a larger percentage of student fees, they charge less per credit hour at $12.98 per hour. However, they have a larger student body and therefore take in more in terms of dollar amount and use it to fund a larger portion of the athletics budget. Students I’ve talked to at UCF have said they don’t mind. They point to the outstanding athletics facilities on campus and their hope that spending like a Big East program will one day make them a Big East program.

The other thing I wanted to touch on is something I wrote about yesterday in my Five-Year Snapshot of USF Athletics Finance.  USF has seen very little growth in alumni donations over the past five years at just over 8 percent.  I checked a couple of other programs in the conference and their increases in alumni contributions over the same time period was far more substantial: Louisville had a 45.82% increase and Rutgers had a whopping 116.34% increase. I also checked some other schools I had laying in front of me, both of which also had far more substantial increases than USF: UCF had a 58.11% increase and Memphis had a 64.38% increase.

The bottom line is that students are always going to be left to shoulder the burden when football profits and alumni contributions are not. The situation at USF is not unique, but it does more closely resemble the plight of non-AQ programs than the status quo of other AQ programs.

It’s my opinion that students will see a return on this investment if the program grows. When athletics programs are able to reach a national audience they attract more applicants to the school. Over time, this allows the school to be more selective. As the quality of the student population improves, the university garners more accolades and is able to improve academically by attracting better professors, qualifying for research grants and so on.

You can read more about finances around Conference USA here and see the entire list of top 25 student fee recipients here. Interested in what your school’s athletic department is taking in from students? You can find the SEC, Big Ten and Big 12 here, the Pac-10, ACC and Big East here, and the non-AQ conferences here.

Top 25 Recipients of Student Activity Fees in BCS

Student Section at UCF Football Game

Last week I showed you the top recipients of student fees in the AQ conferences. That list changes dramatically when you consider non-AQ schools. Here are the top 25 recipients of student activity fees in the BCS based on dollar amount:

1 University of Central Florida $17,466,918.00 44%
2 Ohio Univ $16,460,250.00 69%
3 Univ of Akron $16,199,911.00 67%
4 Florida Intl Univ $15,635,778.00 71%
5 Miami Univ (OH) $13,786,549.00 53%
6 University of South Florida $13,026,289.00 33%
7 University of Virginia $12,160,103.00 15%
8 Kent State $10,516,660.00 54%
9 East Carolina University $10,441,783.00 32%
10 San Diego State Univ $10,220,740.00 31%
11 Univ of Toledo $9,824,257.00 49%
12 Bowling Green $9,497,261.00 50%
13 Ball State Univ $9,221,400.00 46%
14 Florida Atlantic Univ $8,877,456.00 55%
15 University of Connecticut $8,626,506.00 15%
16 Rutgers University $8,441,092.00 13%
17 Northern Illinois Univ $8,333,419.00 38%
18 University of Memphis $7,666,067.00 19%
19 Univ of Buffalo $7,439,422.00 29%
20 Florida State University $6,919,449.00 9%
21 University of North Carolina $6,859,868.00 9%
22 Middle Tennessee State $6,848,065.00 33%
23 Virginia Tech $6,533,756.00 10%
24 Western Kentucky $6,437,652.00 28%
25 Univ of Southern Miss $6,056,608.00 31%

Only six on the list come from AQ conferences and all are either from the ACC or Big East. It’s also interesting to note that five Florida schools and four Ohio schools are in the top 25, which I’ll discuss more below.

Perhaps more interesting than the dollar amount, which is certainly influenced by size of enrollment and amount of student activity fees charged per student, is which schools top the list in terms of the percent of total athletic department revenue being generated by student fees:

  School Student Fees % of Total Revenue
1 Florida Intl Univ $15,635,778.00 71%
2 Ohio Univ $16,460,250.00 69%
3 Univ of Akron $16,199,911.00 67%
4 Florida Atlantic Univ $8,877,456.00 55%
5 Kent State $10,516,660.00 54%
6 Miami Univ (OH) $13,786,549.00 53%
7 Bowling Green $9,497,261.00 50%
8 Univ of Toledo $9,824,257.00 49%
9 Univ North Texas $5,007,059.00 49%
10 Ball State Univ $9,221,400.00 46%
11 University of Central Florida $17,466,918.00 44%
12 Northern Illinois Univ $8,333,419.00 38%
13 Univ Arkansas Little Rock $3,627,665.00 38%
14 Univ South Alabama $5,680,478.00 35%
15 University of South Florida $13,026,289.00 33%
16 Middle Tennessee State $6,848,065.00 33%
17 East Carolina University $10,441,783.00 32%
18 San Diego State Univ $10,220,740.00 31%
19 Univ of Southern Miss $6,056,608.00 31%
20 Arkansas State Univ $2,832,773.00 30%
21 Univ of Buffalo $7,439,422.00 29%
22 Western Kentucky $6,437,652.00 28%
23 San Jose State $4,683,122.00 23%
24 University of Memphis $7,666,067.00 19%
25 Utah State $3,700,874.00 19%

Seven schools get at least half their budget from student fees, with students at Florida International providing more than 70% of the total revenue for the athletic department! If you expand the pool to schools receiving at least a third of their athletic department revenue from student fees, you’re up to sixteen schools. This time only one AQ school makes it onto the list: South Florida. While there’s certainly a trend in the non-AQ conferences for requiring student fees to fund athletics, there’s a definite pattern in Florida and Ohio.

I spoke with Brad Stricklin of University of Central Florida Read the rest of this entry