NCAA Study Shows that Most Athletic Programs Lose Money

A recently released NCAA report concluded that most college and university athletic departments are losing money.  This study is given more credence by observers as it utilized an accounting method that separated institutional allocations from money earned through ticket sales and private donations.

Here are the highlights of the study:

• Only 17 of the more than 300 Division I athletic programs earned a net profit between 2004 and 2006
• Ticket sales and private donations accounted for more than half of all revenue
• 16 of the 17 profitable programs came from Division 1-A, also known as the Football Bowl Subdivision
• The fastest growing expenses in Division I sports programs are coaching salaries:  in Division I-A, the median salary for head football coaches grew by 47 percent between 2004 and 2006, rising to $855,500 from $582,000, while the median salary for men’s basketball coaches rose 15 percent, to $611,900
• In addition to rising coaching salaries, the construction of state-of-the art facilities is a significant expense for institutions

According to the database at indystar.com, the University of Connecticut may not be one of the 17 schools earning a profit (UConn’s figures for the 2005-2006 season are not available).  The database reports that UConn’s revenues, for the 2004-2005 school year were $47,195,392 and its expenses amounted to $47,359,002 – a loss of $163,610. 

Despite the apparent losses incurred by athletic programs, it is important to recognize that schools are more than willing to put money back into their programs to hire the best coaches, recruit the best players and ultimately win games.  UConn’s handling of the proceeds from the Meineke Car Care Bowl is demonstrative of this point.