WaPo: Playing In the Red

[dcpony]

Washington Post
Playing in The Red
Big-time College Athletic Departments Are Taking More Money In Than Ever -and spending just as fast. These 28 schools operated at a loss in 2014

http://www.washingtonpost.com/sf/sports ... the-bills/

In September, Auburn University’s football stadium debuted one of the largest video boards in North America. At just shy of 11,000 square feet, the high-definition screen is roughly the size of a five-story building. During a test one night this summer, the glow was visible in the skies over the rural plains of eastern Alabama nearly 30 miles away.

When he announced the purchase, Auburn Athletic Director Jay Jacobs said the new board would help recruit star athletes and sell tickets. This convinced Auburn’s board of trustees to approve the $13.9 million expense even though the athletics department posted a deficit of more than $17 million the previous year, an analysis of financial records shows, one of the worst fiscal years in Auburn athletics history.

The same month, about 1,000 miles away in the crowded suburbs of northern New Jersey, another Rutgers University football season began with much less fanfare. There was no new video screen to celebrate, just a football team that has struggled to keep up with powerhouses like Auburn — on the field and financially — for more than 30 years.

Six years had passed since Rutgers’s last big athletics purchase — a $102 million expansion of the football stadium, which the former athletics director said would help finally make the program financially self-sufficient. That plan hasn’t worked yet. In 2014, Rutgers’s athletics deficit topped $36 million, an amount equivalent to losing $1, every second, for a year.

Big-time college sports departments are making more money than ever before, thanks to skyrocketing television contracts, endorsement and licensing deals, and big-spending donors. But many departments also are losing more money than ever, as athletic directors choose to outspend rising income to compete in an arms race that is costing many of the nation’s largest publicly funded universities and students millions of dollars. Rich departments such as Auburn have built lavish facilities, invented dozens of new administrative positions and bought new jets, while poorer departments such as Rutgers have taken millions in mandatory fees from students and siphoned money away from academic budgets to try to keep up.

To examine why so many big college athletic departments struggle to profit, The Washington Post reviewed thousands of pages of financial records from 48 public universities in the “Power Five,” the five wealthiest collegiate conferences. All 2004 figures are adjusted for inflation.

[Pony_Law]

Old news, this is a well know issue. The only thing that these accounts miss is the value to the university for increased exposure. Also I'm fairly certain that success athletically leads to more alumni engagement and giving to the school generally (not just to the athletic department).