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WINNING

for

Just how much is difficult to determine.

Much of the expense and the revenue data from athletics is distorted by the involvement of booster clubs. According to the Wall Street Journal, in the

athletic departments of 119 Division I schools, 15 of the 17 men’s sports lost money. The most costly were baseball and track and field. Even fencing had a median loss of $114,000. Only basketball and football were profitable, with a combined annual profit of about $2.5 million. But for all sports, the typical athletic program lost almost $4 million. And that’s men’s sports only! New marketing ideas have produced bet-

ter revenues for a few college athletic pro- grams. One example is the “Chick-fil-A Kickoff Game.” It’s a regular season matchup of University of Alabama and Vir- ginia Tech. The University of Georgia recently signed an eight-year, $92.8 million contract with International Sports Properties, a marketing company that will own the rights to Georgia’s stadium signage, internet prop- erties, radio network and coaches’ shows.

2008 NET REVENUE PER SCHOOL NCAA MEN’S SPORT

Football

Basketball Baseball

Cross Country Lacrosse

Ice Hockey Soccer

Swimming Wrestling

Gymnastics

12 Today’sCampus

Track & Field,

+$1,950,000 +$518,000

STRATEGIES

GE REVENUE

NERATION

Auxilliaries

Auxiliaries as the New Financiers

University auxiliary divisions are becoming more sophisticated operations. North Car- olina State University bundled student centers, bookstores, copy services, campus cards, trademarks, licensing, dining, vending, concessions, convenience stores, catering and retail operations under the moniker Campus Enterprises and appointed a vice-chancellor level director. Sacramento State’s University Enterprises,

–$709,000 –$657,000 –$640,000 –$605,000 –$583,000 –$545,000 –$518,000 –$418,000

Inc. (UEI) has a similar service group with some novel initiatives. UEI owns an electronic outdoor board on Highway 50 which has pro- duced $225,000 in advertising revenue in two years. UEI also acquired the former CalSTRS building in 2007 for $3.53 million. Newly named Folsom Hall, it has 188,000 square feet of classroom and lab space for the school’s nursing students. UEI has also managed $300 million in research grants since 2003. The 501(c)(3) entity was created to separate certain revenue streams from state funding. Florida Atlantic University has a $123 mil- lion Public-Private Partnership (PPP) with British Balfour Beatty Capital Group for the development and management of “Innovation Village,” a recreation, residential and retail initiative for grad students. The PPP offers an alternative solu- tion for higher education insti- tutions which are looking to bridge the gap between neces- sary capital plans—for aca- demic facilities, classrooms and labs, athletic spaces, wellness centers and improved student housing—and the traditional financial resources needed to execute such plans.

Looming Threat

CFOs are squeezing more rev- enue from every available source. Yet the revenue

sacramento state’s electronic outdoor board generates $225,000 in advertising revenue.

increases would pale in comparison to a pos- sible loss of the tax exempt status historically afforded to educational institutions. “We’re having to look at the public serv-

ices nonprofits use and how we can ade- quately cover our costs,” says Matt Greller, executive director of the Indiana Association of Cities and Towns. “We can’t give services away for free any longer.” State and local governments have tried

rolling back various nonprofit tax exemptions in the past, with limited success. Churches appear the safest. Colleges may not be so favored. Some localities have negotiated PILOTS, or payments in lieu of taxes, from some nonprofit groups. Harvard, for exam- ple, paid the City of Cambridge $2.2 million in 2008, as well as $5.2 million for water and sewer service. Cash-strapped governments may not view college campuses as similarly afflicted. TC

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