Column: Should Students Be Funding the College Arms Race?December 17, 2015

Column: Should Students Be Funding the College Arms Race?It takes lots of money to field college athletic teams. But few college athletic programs are generating their own funding.

To support their programs, college athletic departments have received $10.3 billion in student fees and other subsidies in the past five years, with student fees accounting for nearly half that total. Those numbers come from a joint study conducted by The Chronicle of Higher Education and the Huffington Post. The study reviewed financial data submitted to the NCAA by 201 public schools in Division I (most private schools are exempt from filing such information). The authors of the study found that students at some schools pay as much as $1,500 annually to help finance athletic programs.

Subsidies for athletic programs have climbed steadily during the period covered by the study as the arms race in Division I has escalated. Over the past five years, all subsidies have increased by 16% and the portion attributable to student fees has increased by 10%. Athletic fees are tacked on to other costs of attendance, in some cases disguised to the point that students are unable to discern where their money is going.

One of the most outrageous examples of student subsidies is at Georgia State University. In 2014, student athletic fees at the urban Atlanta institution totaled $17.6 million, approximately three-fourths of the entire athletic budget. To add insult to injury, the GSU student population is among the poorest in Division I. Nearly 60% of the students who attend GSU qualify for Pell Grants, the federal aid program created to support low-income students. In other words, the athletic program is dependent on financial support from those who are least able to afford it. Apparently, that “involuntary” financial support hasn’t endeared the program to the GSU student body. Last year average attendance at Georgia State football games was among the 10 worst in Division I.

Lest you think Georgia State is alone in tapping students for the lion’s share of athletic funding, The Chronicle/Huff Post study found that in 2014 athletic departments at 47 other public colleges – nearly a quarter of those reviewed - received more than 75% of their funding from student fees and other institutional support.

The allure of bigtime athletics can be intoxicating to colleges desperate for visibility and the increased enrollment and donations that can follow. But unless teams are successful on the field – Georgia State’s record since upgrading to Division I is a staggering 3-29 – exposure is limited and donors are unlikely to write big checks.

The subsidies come at a time when the revenue spigot in college athletics is a veritable geyser. According to The Chronicle/Huff Post analysis, in the past five years $26 billion in revenue has flowed into the coffers of Division I public college athletic departments. But half of that amount is shared among a mere two dozen colleges, leaving the rest reliant on substantial subsidies. Most of the “have” schools are in the power five conferences, the Big Ten, SEC, Pac 12, ACC and Big 12. By conference, the Big Ten has the lowest reliance on handouts; only 2% of its revenue comes from subsidies. At the other end of the spectrum is the Big South Conference which only earns 16% of its revenue; the remaining 84% comes from subsidies.

Although football is the big elephant in the room, soaking up the highest percentage of revenue – and subsidies – of any other sport, it should be noted that other sports are solely dependent on subsidies for their very existence. Without that support many non-revenue sports, which includes almost all women’s teams, wouldn’t survive.

Once on “welfare,” the likelihood of improving the balance between generating revenue and relying on subsidies is slim. The Chronicle/Huff Post study found that in 2010, 127 public universities subsidized more than half of their athletic departments’ budgets. Five years later, only five of those schools had flipped that equation and were generating more than 50% of their revenue from outside sources. And none of them had become self-sufficient.

Don’t expect the athletic welfare system to disappear any time soon. Like politicians and taxes, athletic departments have become dependent on subsidies – it’s easy money that’s too difficult to pass up. And those who are burdened the most have the least to say about the system.