The News Courier in Athens, Alabama

Sports

January 16, 2013

Study highlights spending gaps in NCAA

(Continued)

Perko said it's the growing subsidies most universities kick in to cover athletic department budgets that are especially alarming. The Knight Commission has been pushing for the NCAA to incentivize institutions to stay within certain ratios of athletic-to-academic spending, to no avail. The BCS, which is organizing the new college football playoff system separately from the NCAA, has committed to tying 10 percent of the lucrative payout from the new BCS playoff system to academic benchmarks, Perko said, but she wants more done.

While new TV deals will produce more revenue, they will also likely exacerbate inequality. If adopted, recent proposals to pay athletes a stipend would also fuel spending by athletic departments, as could the increased travel required by recent conference re-alignments.

Many big spenders like the SEC schools also have the most revenue to cover those costs. A few dozen or so actually turn a profit on their athletic departments, and on average the top half of FBS programs get by on a modest university subsidy, averaging between $3 million and $6 million. But schools in the bottom half of FBS rely on much bigger subsidies from the academic side to fund athletics. That money often comes from student fees paid by non-athletes. At those schools, the subsidies now total $11 million to $14 million annually, the study found.

"The data that really jumps are out are the serious financial divides among the 300-plus Division I schools with regard to where their money comes from," Perko said. "Those differences are really causing the Division I model to really rip apart at the seams."

But even at big-name schools, financial pressures are mounting. The University of Maryland recently bolted the ACC for the Big Ten in hopes the Big Ten could help it staunch multi-million dollar annual losses in its athletic program. The University of Tennessee's athletic department recently discontinued an annual $6 million contribution the athletic department had been sending back to the university — even as it hired a new football coach, Butch Jones, at more than $3 million annually.

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