What does football pay for at Michigan?
This is not a rhetorical question. Does football pay only for itself? For itself and other sports? For brining dinosaurs back to life in an underground terrarium that will only be accessible to Michigan grads who are also Masons? I don't know.
Why am I asking? Because I think it's at least reasonable to read President Schlissel's statements (discussed in a prior thread today*) as meaning he wants to dial back Michigan's emphasis on winning football games. And I'm curious what de-emphasizing winning would mean for the school's budget. I assume de-emphasizing winning would mean less revenue for the AD, but again, I don't know what that revenue goes to specifically.
*See the "Schlissel on academics and athletics (AD search related)" thread.
November 11th, 2014 at 5:38 PM ^
Of course his focus is going to be on academics, he's the president of an ACADEMIC INSTITUTION. If anything, all of his comments regarding the athletic department have been more of the "this is out of my wheel house, so I'm relying on other more knowledge people to help me" variety.
I get that having a new president, AD, and football coach all at the same time is a really unusual situation. But the football program has become so incestuous and inbred, there is a real opportunity to do some new things with it, which is desperately needed.
November 11th, 2014 at 6:14 PM ^
1. I intended to be self-deprecating, not sarcastic, when I said I was okay with your definition. That may not have come through.
2. I think the quotes below can at least reasonably read to show an attitude toward sports that (for good or for bad) is not in line with "this isn't my wheelhouse, so I'll defer."
“People have been saying all kinds of things about who I’m talking to about positions and this sports stuff, and they name names of people who I have no idea who they are,” Schlissel said. “I’ve really learned that this whole athletic sphere and the usual way you approach things just doesn’t work. It’s just a crazed or irrational approach that the world and the media takes to athletics decisions.
“It’s a time sink,” he added.
“We admit students who aren’t as qualified, and it’s probably the kids that we admit that can’t honestly, even with lots of help, do the amount of work and the quality of work it takes to make progression from year to year,” he said. “These past two years have gotten better, but before that, the graduation rates were terrible, with football somewhere in the 50s and 60s when our total six-year rate at the University is somewhere near 90 percent, so that’s a challenge.”
November 11th, 2014 at 4:12 PM ^
stay in the athletic department?
Or does some of the (direct) profit go to the academic side?
November 11th, 2014 at 4:23 PM ^
Here is some financial information from 2 years ago. It appears that no, the athletic department does not give money to the University general fund.
November 12th, 2014 at 2:36 PM ^
The info may be great but the interpretation is NOT.
Athletics absoltuely does may money to the University for the tuition of its scholarship athletes. Tuition for tendered athletes is not a write-off. The AD pays for it.
November 11th, 2014 at 4:25 PM ^
November 12th, 2014 at 2:37 PM ^
This runs counter to my understanding. Tuition payments are more than donations to the general fund.
November 11th, 2014 at 3:41 PM ^
it's ok for M to pay $7M (plus if needed) to a HC that will basically provide a guarantee to revenue.
November 11th, 2014 at 3:43 PM ^
Football and basketball generate net revenue, although you could remove the basketball revenues and barely notice the hit to the overall budget. Hockey is more or less break-even and made money in the Big Chill year because of that one game. No other sport at Michigan makes more than it spends.
But it's not quite that simple. Facilities are paid for mostly through donations. Some scholarships and coaching positions are endowed. Other revenue sources bring in a lot (BTN, donations, sponsors, etc.).
I do know that in the case of lacrosse the first few years of operating expenses were covered by donors. I know this because I'm one of them (although my check was pretty insignificant in the grand scheme of things).
November 11th, 2014 at 3:44 PM ^
November 11th, 2014 at 3:44 PM ^
Basketball is the major funder now, football pays for a lot though.
November 11th, 2014 at 3:47 PM ^
November 11th, 2014 at 3:47 PM ^
thats true. Football is still the top revenue generator.
November 11th, 2014 at 3:48 PM ^
Here's a link explaining the department's finances.
November 11th, 2014 at 3:53 PM ^
If you really want to be a journalist, things like fact-checking are important.
November 12th, 2014 at 5:49 PM ^
Fact-checking is overrated when you're 14.
November 11th, 2014 at 4:10 PM ^
Tickets are between $30-40.
UM football plays 7 games a year in a 113,000 seat stadium at $80 a pop.
This isn't to count all the merchandise UM football is responsible for selling. The Adidas contract came about because of football, not basketball.
November 11th, 2014 at 4:14 PM ^
Nice try. We aren't Duke. And even they probably have football paying for a majority of their budget.
November 11th, 2014 at 5:16 PM ^
The numbers for FY 2012-13 show department revenues of $144 million and football accounts for $82 million of it, so that couldn't be true anyway. I would imagine that thes figure are probably representative of most years in terms of relative contribution at least lately, or in other words, football is about 60% of the revenue. Interestingly, per and MLive piece on this subject that I remember, football only costs about $20 million or so to operate, so the program feeds a lot of money back into other sports.
I think that same piece said basketball brought in about $15 million - can't remember the operating budget number though, but basketball is also profitable at Michigan.
November 11th, 2014 at 3:49 PM ^
DB's buyout
November 11th, 2014 at 3:53 PM ^
Todd Flanders: "Daddy, what do taxes pay for?"
Ned Flanders: "Oh, why, everything! Policemen, trees, sunshine! And let's not forget the folks who just don't feel like working, God bless 'em!"
November 11th, 2014 at 4:03 PM ^
Was it exclusive for building the new facilities? I've heard Sam and Ira say that most of the new facilities and upgrades are done with donations.
November 11th, 2014 at 4:12 PM ^
November 11th, 2014 at 6:12 PM ^
I agree with your basic point (the university doesn't exist for sports), but I think you (or Schlissel) are underselling the importance of football and sports in general as a means to interact with the university. Sure, on the surface you can characterize it as just some silly or inconsequential thing people have fun with on Saturdays because in a lot of ways, that's what it is. But it's also the window into the university as a whole for a lot of alums and non-alums. Not only does it affect donations (I presume), but it affects people's overall interaction with the University. It's what brings people back for Homecomings. It's what out-of-state alums network around on Saturdays, and talk about at mixers. I just think it's more important than you're characterizing it. Athletics is a big part of what keeps people glued to the university.
November 11th, 2014 at 10:37 PM ^
And, don't get me wrong, I love that Michigan does it that way. I love football, I love that much of my family have had tickets for decades, I love that my future kids will experience it with me, but every other school that doesn't have football has alumni mixers and homecomings too. I went to Rice for grad school, they couldn't care less about football (and I actually wish they'd get rid of it because its a money sink). Instead, they have another tradition called Beer Bike (along with other things) that alumni participate in (though admittedly, I never attended Beer Bike so I can't be certain). My wife went to LaSalle, they have things like that too.
Football has little to do with academc donations, in fact, it might even take away money. Very few people who would endow a chair in the History Department or fund a lab in the Biology Department (or whatever science people do, I'm a historian) consider sports as a factor in their decision.
I agree with you in regards to non-alumni and it's the argument I make in defending colleges, at least state schools, having football programs. As the flagship university of the State of Michigan, the University of Michigan has the duty to encourage higher education in the state. I can attest to this because I experienced it, college football serves as a window into the academic and scholarly sphere for those who don't have parents who went to college. It gives people who just like the team a reason to come on campus and experience things like gigantic libraries, art, and architecture without feeling out of place. This is the biggest problem I had with Brandon making football tickets so expensive. By catering to the wealthier alumni base, he was going against one of the major missions of the university. Football is a tool to reach into homes that otherwise wouldn't think about Michigan specifically and higher education generally.
November 11th, 2014 at 4:15 PM ^
My understanding is "pretty much all of them", though I do believe basketball and (maybe) hockey break even most years.
November 11th, 2014 at 4:26 PM ^
President Schlissel knows ( I think) that the de-emphasizing athletics ship has sailed. Maybe that is something he could do at Brown where they don't have a fraction of the athletic infrastructure that Michigan has - and will have.
It will be interesting to see if you can focus on academics, limit time dedicated weekly to the sport and still compete on a national level. I think a successful Michigan team, both financially and athletically, will have a mix pf players where some love football, are good at it and want an education at a great institution and others who have an eye on the facilities and coaching that will give them a shot at the NFL. Afterall, isn't that why many of us chose Michigan, to give us a better chance at succeeding after college?
November 11th, 2014 at 5:00 PM ^
isn't that why many of us chose Michigan, to give us a better chance at succeeding after college?
Not true for me, I just really like yellow block Ms.
November 11th, 2014 at 4:59 PM ^
November 11th, 2014 at 5:03 PM ^
Are you just stating a fact or trying to make a point? What is the "so what"?
November 11th, 2014 at 7:05 PM ^
November 11th, 2014 at 5:07 PM ^
Marching Band also turns a high profit, if you're measuring it in AWESOME DOLLARS
November 11th, 2014 at 5:26 PM ^
which breaks down the sources of revenue and the major areas of expenditure.
http://www.regents.umich.edu/meetings/06-14/2014-06-X-14.pdf
November 11th, 2014 at 7:00 PM ^
The PSD's are a VERY big impact on this budget. If the luxury boxes and club seats had never been built, we would be in a world of hurt, budget wise. Actual tickets would need to double, or AD staff cut in half. Saving this document. With DB buyout and coaches buyout and higher costs for Harbaugh---we will be in the red for 2015.
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November 12th, 2014 at 1:08 AM ^
We'll be in the red either way, but tickets are gonna plummet if they keep Hoke. The only thing that could save us, is a "home run" hire. People are not gonna buy tickets if we hire someone like Schiano.
BTW-Take a listen to this season ticket holder(starts at 27:45) on the Jamie Morrris show:
http://www.stationcaster.com/download.php?file=http://cdn.stationcaster…
November 11th, 2014 at 6:43 PM ^
But if the AD wants to pay for Jim Harbaugh and a G6 for Kate Upton to fly in as our new recruiting coordinator, and does it with its own budget, why does he care?
He'll sound silly saying "don't spend that BTN money on what it's for (a team worth showing on the air) do nothing with it or set it on fire"
November 11th, 2014 at 7:35 PM ^
November 11th, 2014 at 9:16 PM ^
November 11th, 2014 at 11:30 PM ^
November 11th, 2014 at 9:38 PM ^
Second, the AD budget is a fraction, less than 3%, of the university operating budget. Which doesn't include investments and certain joint ventures and unusual large donations. Tell me Schlissel should wake up in the morning worrying about whether football is going to pay for something. He's exactly right to say the undue attention it receives is a "time sink". Changes in, for example, Medicare and Medicaid reimbursements will have enormous impact on the fiscal status of the university. Football? Come on.
I think he's doing exactly what he should be doing, delegating to a competent, connected, man who will fix this mess under his guidance. Balance? Great, last time we had a president who talked about such balance we won multiple B1G championships. Not like Schlissel is messing with a recent tradition of winning, is he?
November 11th, 2014 at 10:07 PM ^
Considering that only 20 or so universities actually consistently run their ADs for a profit suggests that most presidents don't require ADs to be self supporting. Otherwise, there would be a lot of fired athletic directors each year. As you say, 3% is quite small. The recent decision to reduce student tickets may result in 8,000 more students(back to previous numbers). Just this one change will likely cut the 2015 profit projection in half.
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November 11th, 2014 at 11:08 PM ^
November 11th, 2014 at 11:13 PM ^
This isn't an exact answer but remember that the Ivy's don't allow athletic scholarships, so that takes a huge expense off the books of the AD and either turns it into cash for the school or a financial aid expenditure.
The Ivy's also endow head coaching positions like crazy (I believe 8/8 head football coaches are endowed), which is another way to keep expenses down.
November 12th, 2014 at 7:30 AM ^
At most schools, the athletic department takes money from the academic side, usually in the form of mandatory fees. Michigan is one of a tiny number of universities that isn't diverting money from its core mission, education and research, to fund entertainment. (It always surprises students at Iowa when I show them the budgets when the AD doesn't break even and they realize their tuition subsidizes Ferentz's salary.)
The AD gives nothing to the university directly, unless you count the scholarhip tuition payments, which may or may not cover the cost of instruction.
The research is mixed on the topic, but a world-class nationally prominent educational institution like Michigan will usually have no trouble raising funds from, for example, business, law and medical school alums. AD donors, in general, with spectacular exceptions, don't give to the general fund--they may sign on for a capital initiative, but usually their money stays in the AD. (Think for a moment: what universities have the largest endowments?)
In terms of recruiting high-end academic students, especially grad students, or world class faculty, the football team means nothing at all. (An anecdote: I was recruited to play football by the Ivy League and Indiana. I decided to go to UM for academic reasons. The first time I saw the Michigan helmet was the 1970 OSU game on television. That's when I realized UM was good at football.)
Schlissel has no control over how much or how little the AD emphasizes football. All he can control is whether or not the academic side cuts corners on athletes. I don't think UM is UNC, and I don't believe that UM is worse than Stanford in this regard, Harbaugh notwithstanding.
The only thing that he can do to piss people who are fans of Michigan sports, but not the school as a whole, is take his time with the AD hire. I love Michigan football because I love the university as a whole, not the other way around.
I say let him do his job.
November 12th, 2014 at 3:00 PM ^
I've said this downthread, but I think it deserves a main-level comment.
Contrary to what has been claimed, Athletics pays $$ to the University's academic enterprise.
Athletes with full scholarships get what we call a "free ride" but it's not that the University is just waiving the tution fees. The University still charges them--it's just that Athletics picks up the tab. Just like if a rich uncle did.
Now, I have seen arguments that this is not meaningul because it happens "in the system" (as opposed to athletics carrying bags of cash over Fleming, presumably) or because tuition is some arbitrary figure that may or may not cover the cost of instruction or whatever, or because athletes are just a small sliver of the student body. That's beside the point. The point is, the money flows from athletics to academics, not the other way around. Tuition payments are made on the same basis as they would be for any other enrolled students at the U (that is, athletes don't get some special rate or some agreed-upon deal between the U and the AD).