UofM athletic department projecting surpluses for the next two years

Submitted by Blue in Paradise on

Highlights

  • The University of Michigan athletic department expects a budget surplus of $2.4 million for the current fiscal year and projects a $2 million surplus in the coming 2018 fiscal year.
  • Included in the department's projections is an increase in transfers to the university from $3.825 million in FY '17 to $7.875 million in FY '18.   
  • Conference distributions are projected to increase to $51.1 million in FY '18 from $36.3 million in FY '17 due mostly to a new conference media rights agreement. 
  • Football ticket sale revenues are projected to decrease due to a six-game home schedule in FY '18, compared with eight games in FY '17.  (Blue in Paradise: This means the surplus should increase starting in 2019 when we are back to 7 home games)

http://record.umich.edu/articles/michigan-athletics-reflects-solid-fina…

(edit: Rashan Gary looking like a football player and future All American / top draft pick - as a future B-school student, he is happy to hear about the budget surplus)

 

I thought this would be good to post as there had been some trolling by rival fan / national pundit types because of the debt owed by the Athletic Dept and the amount of money being spent on various athletic projects and compensation for the coaches. 

Of course, anyone with an ounce of common sense understood that the debt was incurred to finance investments in the end product.  Those projects and coaches are necessary to improve the fan / athlete / student experience which then drive the higher revenues.

Note: in 2018, the athletic department will transfer $7.875 million to the University.  This means that the revenue sports are able to not only pay for the non-revenue sports but also send a nearly 10 digit check back to the benefit of the school.  Great stuff all around - now if only the players can get a bigger piece of the pie...

 

 

 

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BoFlex

June 16th, 2017 at 1:15 AM ^

I'm a little confused with how they can project a $2 million surplus, but then transfer $7.875 million to the university... Wouldn't that give the athletic department a ~$5.875 million deficit in the end?

Edit: I was a little curious on how that compares to other large athletic programs, and found this USA Today chart. How does Texas A&M's athletic department have a $73.1 million surplus?! Holy heck!

Joined: 05/30/2011

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Blue in Paradise

June 16th, 2017 at 1:16 AM ^

and the other expenses.  This is gov't accounting not GAAP accounting where the shareholder distributions come after the reported P&L.

The surplus are funds that can be used to pay down the outstanding debt or reserved for future years.

 

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Blue in Paradise

June 16th, 2017 at 1:32 AM ^

I don't remember the specifics but I remember some discussion on those very numbers.  Either way, the Texas schools show huge numbers due to the sheer size of their alumni / fan base. 

Texas also has the Longhorn network.  OSU and UM will be up there once the new deal kicks in.

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BoFlex

June 16th, 2017 at 1:58 AM ^

I was moreso highlighting the absurdity of Texas A&M's figures compared to every other program in the top-10:

School

Total Revenue

Total Expense

Revenue-Expenses

Texas A&M

$192,608,876

$109,313,651

$83,295,225

Texas

$183,521,028

$173,248,133

$10,272,895

Ohio State

$167,166,065

$154,033,208

$13,132,857

Michigan

$152,477,026

$151,144,964

$1,332,062

Alabama

$148,911,674

$132,354,913

$16,556,761

Florida

$147,105,242

$125,384,443

$21,720,799

LSU

$138,642,237

$121,947,775

$16,694,462

Oklahoma

$134,269,349

$123,017,251

$11,252,098

Tennessee

$126,584,033

$113,413,325

$13,170,708

Penn State

$125,720,619

$122,271,407

$3,449,212
 
According to USA Today, most of the large programs hover around ~$10-15 million in "profit," but somehow Texas A&M has blown everyone else out of the water including Texas.

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Blueblood2991

June 16th, 2017 at 1:22 AM ^

$51.1m conference payout is insane. The funny part is Rutgers doesn't get a full payout until 2022. That's when it'll be time for the next B1G contract negotiations, and there's a strong chance the tv bubble will have burst by then.

Thanks for letting the rest of us get rich off your cable market in the meantime though.

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Sopwith

June 16th, 2017 at 12:00 PM ^

We don't let people cash in on their own likene... oh, wait. Yes we do. Except if you're a college athlete generating gobs and gobs of money.

I've been saying this forever. The schools don't have to actually do anything. Just let the free market allocate the value. Just don't actively step in and say "no, you can't have a job, a YouTube channel, or an endorsement deal."

Joined: 06/29/2010

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Blue in Paradise

June 16th, 2017 at 9:57 AM ^

The package you describe sounds great - but they have a market value that is much higher than $200,000 plus perks.  

You don't see anyone suggesting that coaches or administrators should have a hard cap on their compensation.

I am not suggesting that we open up college football to free agency or make it a free for all.  But why not inrease the cost of living stipend they get and boost it up to a reasonable wage.  At the same time, allow players to sign endorsements and get paid for their likeness.

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scanner blue

June 16th, 2017 at 7:47 AM ^

He /She stands there for 5.5 to 6 hrs and gets $25. Maybe Warde can use  some of that surplus on new Nike jackets for them that aren't nine years old, that are warm, and have functioning zippers.

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