When Saban’s Trickle-down Hits UH
Wednesday - January 10, 2007
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Del.icio.usNick Saban’s most recent multimillion-dollar dream job has sent a wave of concern through college athletics.
As it is, 41 coaches last season made at least $1 million, according to USA Today. Not included were private schools and their leading men like Charlie Weis, who part way through the 2005 season, turned a 6-1 record into a 10-year contract extension reportedly worth between $30 million and $40 million. Public university coach Joe Paterno’s salary has been a state secret for years, and that is now being challenged in court.
No question, the game is changing, and it’s not Saban’s fault. He’s just the latest in a long line of individuals and events that have pushed economic changes that will, in the not-too-distant future, lead to the creation of a fifth class of NCAA football - this one even smaller and more exclusive. Again, we’re not breaking new ground.
In the first few decades of the last century, college football was played at nearly every university, regardless of size. It’s why Notre Dame could play Wabash and Haskell ,and Michigan could test its mettle against Case and Mount Union. The unlevel financial playing field doomed the smaller schools as programs were dropped and those with bigger budgets and better facilities came to dominate nearly the entire sport.
In 1973, the separation of powers seemed to be complete as the NCAA created the three familiar divisions. Things were further divied up in 1978 when Div. I was split into I-A and I-AA.
If history is our guide, the financial-led division of athletics should continue. The only real question is whether the NCAA will be able to control it. For years, the scuttlebutt warned that the so-called BCS conferences would break from the NCAA to form their own super-funded league. This is the one concern that turns the proverbial overweight simian into a frightened schoolgirl. Without the huge pay days that these schools bring in, the rest of the NCAA, which gets to dip their toes in the financial fountain of youth, may very well find themselves in financial trouble.
One of the most disturbing trends facing the NCAA is that schools are losing money, and the huge contracts being paid to coaches are contributing to the problem. The NCAA’s latest biennial study, Revenues and Expenses of Divisions I and II Intercollegiate Athletics Programs, that was presented at the January 2005 convention, reported that both revenues and expenses had increased at a higher rate than was expected. This, however, was offset by member schools who in greater numbers are dipping into the universities’ general funds to support athletics - a practice that no doubt is a sore subject for English professors everywhere.
The study’s author, Daniel Fulks, director of the Accounting Program at Transylvania University, said, “Only about 40 percent of Division I-A athletic departments report excess revenues when institutional support is removed from the equation.”
Which means 60 percent of schools are unable to meet their budgetary requirements without help from their school’s general fund.
Moreover, with institutional support removed, overall expenses at Division I-A schools on average run $600,000 ahead of revenues. That number jumps to $3.7 million in Division I-AA. If another split takes place, schools in the Mountain West, MAC, WAC, Conference USA or Sunbelt will effectively become something similar to Div. I-AA or maybe even Div. II - a scary thought when you consider that for schools outside I-A, institutional support accounts for 49 to 61 percent of average revenues.
At universities such as Georgia, where student fees bring in $3 million for the athletic program, subsidies are the norm and may go unnoticed in a yearly budget that had grown to $45 million as of 2004. But for the schools that have to go at it alone, the ever-increasing Saban-type salaries mean a trickle-down effect that will press budgets and fundraising to their limits.
So what does that mean locally? June Jones pulls in $820,000 with a possible $130,000 in maximum bonuses - good enough for No. 2 in the WAC, yet below the Div. I-A average of $950,000. After a record-tying victory total and a WAC Coach of the Year award in 2006, what kind of bump could the university’s winningest football coach expect when his contract runs out in 2008? The market says Jones deserves a nice little pay raise, but how much can UH and its supporters raise to pay a competitive wage for a school with an entire athletic operating budget of only $21.8 million and a football program that has $2.262 million to spend? Coaches’ salaries are not included in these budget figures.
Call it the Reaganomics of the NCAA - a boon for the big boys, a problem for all the rest.
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