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March 2009


The Price to Play

THE COST OF COLLEGIATE ATHLETICS
REACHES NEW HIGHS.

by Clint Shields

Average football game attendance rose across the state, including gains at UT-Austin, Texas Tech University, UT-El Paso, Rice, TCU, SMU and Houston. But tough economic times could make it harder for some fans to attend.

Texas is home to several nationally renowned athletic programs, and their hefty budgets help those programs keep pace in the ultra-competitive realm of the National Collegiate Athletics Association (NCAA).

The University of Texas at Austin’s fiscal 2009 athletic budget, for example, tops $125 million, making it one of the largest athletic budgets in the nation. Texas A&M University’s has pushed past the $69 million mark for fiscal 2009. Both schools compete in the Big 12 Conference, and both schools’ budgets are among the four largest in the conference.


Building on Success

Since the late 1990s, UT-Austin’s athletic budget has risen by about $100 million. But the 20-sport athletic program, riding national success from its football, basketball and baseball teams, also turns a profit, one of only a handful that can make that claim.

More than 20 percent of UT-Austin’s budget is tied to coaches’ salaries, but millions also are spent on athletes’ tuition, housing and fees, as well as tutors, mentors and hundreds of student employees. It also includes facility management and maintenance, from a 94,000-seat football stadium to the school’s outdoor tennis facility. Top-flight facilities allow the university to host NCAA regional events and state high school championships and graduations. All bring extra money into the community.

Visitor spending from UT-Austin athletic events will top $170 million in 2008-2009, according to the Austin Convention and Visitors Bureau. Football is expected to generate about $142 million in spending for its seven home dates, more than $20 million per home weekend.

Texas A&M University’s fiscal 2009 athletic budget tops $69 million for its 20 sports – nine men’s and 11 women’s. The school’s athletic budget has risen by about $4 million annually in each of the past three years.

Millions are spent on tuition and fees for scholarship athletes. Rising salaries, utility costs and moving teams from event to event are contributing to overall rising costs.

“We will not be raising prices. We’re going to try and be a good neighbor and keep things in line, and even reduce some things where we can.”

– DeLoss Dodds
athletics director, UT-Austin

“One of our biggest costs right now is travel,” says Joe Powell, A&M’s athletics chief financial officer. “Those costs have really gone up.”

Football receives the lion’s share of funding at A&M. It also generates the most revenue. In A&M’s case, the football program costs about $17 million in expenditures but generates about $39 million in revenue. Football is one of two profitable sports in the athletic program at A&M, and its revenue helps fund other athletics at the university.

The school is close to turning a profit on its athletic budget.

“We’re not there yet, but we’re close to being in the black,” Powell says.

Scheduling adjustments are helping ease some of the travel costs. In women’s soccer, for instance, the team plays several away games with schools near one another rather than taking subsequent trips to the same area later in the season. Powell says similar scheduling in women’s volleyball also helps.

Eye on the Ball

Recent economic fluctuations did not dampen fan enthusiasm in 2008. Average football game attendance rose across the state, including gains at UT-Austin, Texas Tech University, UT-El Paso, Rice University, Texas Christian University, Southern Methodist University and the University of Houston. But tough economic times could make it harder for some fans to attend. That does not go unnoticed, even at the highest levels of a multimillion-dollar athletic department. The exact effect will just have to play itself out, says DeLoss Dodds, athletics director at UT-Austin.

A Classic on the Move

cotton bowl

Dallas’ Cotton Bowl Stadium hosted its final AT&T Cotton Bowl Classic in January. The game will move to the Dallas Cowboys’ new home in Arlington in 2010. The game’s future surroundings could help position it in college football’s championship scene.

One of five post-season college football bowl games in Texas, the Cotton Bowl contributes more than $30 million in direct economic impact – and more than $90 million in indirect impact – to the area economy.

“We’re like everyone else in that we know there will be an impact, we just don’t know the size of it,” he says. “I’ve had conversations with other athletic directors around the country, and they’re concerned as well.”

Texas A&M’s Powell agrees, saying the school raised football ticket prices in 2008 for the first time in five years. But with fans’ interest and pocketbooks in mind, prices are not likely to rise in 2009, he says.

“We will not be raising prices,” Dodds says. “We’re going to try and be a good neighbor and keep things in line, and even reduce some things where we can.”

Bowls of Sharing

College football’s post-season bowl games are a longtime holiday tradition. Lucrative payouts and television exposure await the participating schools. But not all of that money goes into a university’s coffers. In fact, most of it does not.

“Primarily, teams get their expenses covered, but then the rest goes to the conference and is divided up 12 ways,” Dodds says.

The more conference teams that play in bowl games, the better it is for the remaining schools. But that does not lessen the costs for the participating schools.

“The expenses are huge for a post-season trip,” Dodds says. FN

Bowl Bonanza

Texas hosts five post-season college football bowl games, and all make significant economic contributions to their communities.

Cotton BowlAlamo BowlSun BowlArmed Forces BowlTexas Bowl
CityDallasSan AntonioEl PasoFort WorthHouston
Payout per team$3 million$2.2 million$1.9 million$750,000$612,500
Economic impact$30 million$42.6 million$15 million$20 million$25 million
Average five-year attendance72,74963,11050,06134,55057,153

Photo courtesy of Artie Limmer

Sources: Bowl Associations

Texas Tech fans await kickoff at the 2009 Cotton Bowl in Dallas.

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