France was adopted a month after Fairleigh Dickinson, a small private university in New Jersey, announced in January its intention to sponsor a men’s volleyball team starting in the 2021-22 academic year. The school also plans to add a women’s lacrosse program next year, and the search for a lacrosse coach will begin this spring. Only four other Division I schools have announced plans to expand the number of sports they sponsor since the implementation of COVID-19.
Fairleigh Dickinson’s plans to expand from 19 to 21 teams came at a time when cancellations and postponements resulted in millions of dollars in lost revenue for many schools. Since the NCAA canceled the men’s basketball tournament in the first days of the pandemic last March, 35 Division I colleges have announced that they will close, indefinitely suspend or demote a total of 115 programs (22 of these teams have since been reinstated through fundraising from alumni and/or legal pressure on them). The last reduction in the number of academic teams took place when the financial crisis of 2008 forced schools to tighten their belts.
Fairleigh Dickinson is not immune to the current budget crisis. However, the Knights have noticed a shortcoming in what many see as the balance of the university’s athletics department and how it fits into the university’s broader finances. Looking at it from a different angle, they argued that adding teams – even those that don’t get TV deals or fill stadiums – could help the school.
The Knights recently announced their intention to expand from 19 to 21 teams. Boyd Ivey/Icon Sportswire
Fairleigh Dickinson, like most Division I athletic departments, is counting on the big money from the annual NCAA Madness tournament in March to make ends meet. In addition, the school usually receives a few hundred thousand dollars a year from the big schools in the form of guaranteed matches. Last year, the Knights received only 20% of the money they normally receive from guarantee games.
We looked at our finances, and like everyone else, it was sad, said Brad Hurlbut, FDU’s athletics director. We had to come up with a plan to allay the fears of the university and the athletics department.
Hurlbut joined Fairleigh Dickinson in February 2019 after serving as assistant director of athletics at Sacred Heart University, which sponsors 33 sports. He hired assistant athletics director Jason Young, formerly of the University of Vermont and more or less a specialist in college sports philosophy. Both had hoped to add to the Knights’ roster, but last spring they began to fear that the pressure of the pandemic would push them in the other direction. They decided they needed to change the conversation before order elimination became an option on the table.
With the help of a California economist, Young has noted what he sees as flaws in many sports accounting schools. If you look at the athletics department as a separate organization, they lose money in most sports they sponsor. Supporting the team, paying coaches’ salaries and funding scholarships costs more than revenue from ticket sales, media rights or donations. Yet Young and Hurlbut were able to convince their bosses that these teams did make money by looking at them from a broader perspective that included their impact on the university as a whole. The lists also represent tuition for athletes without or with partial scholarships who would not otherwise attend college.
According to Andy Schwartz, a California economist who first suggested Young and Fairleigh Dickinson think differently about the financial impact of adding or eliminating athletics, eliminating the cost of scholarships and factoring in additional tuition can often move average schools millions of dollars closer to financial balance. Schwartz has spent the last two decades studying the business model of college sports and communicated with Young after sharing some of his thoughts on the industry on social media.
Young calculated that a men’s volleyball team would cost the athletics department $350,000 a year, but would bring in an additional $470,000 in tuition, which would mean a net profit of $120,000 for the school. The women’s lacrosse team will cost approximately $500,000 per year, but will ultimately provide a similar net return of just over $100,000 to the university’s budget. The initial proposal by athletics directors was met with skepticism, but Young said it quickly found supporters among university administrators.
I presented it to university leadership in June, Young said. This allowed us to take a close look at the financial structure of our sports department and really dig in. For us, it was a tailor-made start.
Math works at Fairleigh Dickinson because the candidates and dorms are understaffed. It’s not like that everywhere. Schools like Stanford and Clemson, which are eliminating sports this year, will have no problem filling the places of former athletes in dorms and classes with other students who don’t play sports and may be more willing to pay full tuition.
Schwartz said adding athletics makes sense for schools that have the space to accommodate more students without investing much in additional buildings or staff. Hurlbut said volleyball and lacrosse were chosen as the new sports because neither require major construction or renovation work and both sports are popular in the area, which can reduce future travel costs. The school also received a grant from the First Point Volleyball Foundation to cover start-up costs.
Black compares this approach to a cruise ship offering last-minute discounts to fill empty staterooms. A team made up of partial scholarships is the equivalent of a voucher, he says. If you have a product with a limited shelf life, for example. B. an empty seat on a departing ship, or an empty seat in class – it makes sense to accept a discount rather than leave that seat empty. Most athletics directors don’t think like economists, and in the often insular world of higher education, most universities don’t see the full accounting value of adding sports.
Schwartz said he’s not sure how many schools that have cut sports are unaffordable, but he found plenty of examples where the athletics department cut teams last year and did more harm than good to the school’s overall score.
Schwartz said schools are unlikely to view athletic scholarships as vouchers unless someone advocates for them, which is the best way to look at it. They don’t think it’s inbound marketing.
College sports have long been seen as a marketing tool for the university, a figurehead for the colleges they represent. Marketing is usually about media coverage and name recognition through good results on the field or court. However, Young believes that the most sustainable and effective form of marketing that sport has to offer to medium and small schools is that of convenience – students choose to play sport for the sake of playing sport.
And like cruise ships, the pandemic has left many more schools with empty seats. About 60 percent of U.S. colleges and universities in a recent Chronicle of Higher Education survey failed to meet their enrollment goals last year. The same survey found that two-thirds of these schools had not met their revenue targets.
At Division I schools without football, athletes make up more than 5% of the student body on average. This figure is even higher in the lower divisions – 18% in Division II schools with a football team and 27% in Division III schools with a football team.
It’s getting harder and harder to be broad. For small schools, the savings [from cutting sports] may be negligible or even go the other way, said Tom McMillen, who heads LEAD1, a professional organization for athletics directors at the FBS level.
McMillen said that while more and more schools in the lower divisions are showing interest in adding new sports, this approach has not yet taken root with athletics directors at the FBS level in LEAD1. Some of these schools, particularly those in the G5 conference with a larger regional reach, face similar problems of under-recovery and would benefit from expanding their sports programs rather than reducing them.
Men’s volleyball is one of 11 programs Stanford is considering eliminating from its athletics department. AP Photo/Nam I. Ha.
The decline in enrollment nationwide has greater implications for small schools than for large, brand-name universities, which have no trouble attracting an inordinate number of applicants. At a school like Stanford, which announced the elimination of 11 of its 36 sports this summer, adding or retaining sports is unlikely to have the same positive effect on the university’s budget as it did at Fairleigh Dickinson.
Rather, Stanford’s decision to split nearly a third of its department – to which its talented alumni responded with dismay and protest – reflects the priorities that determine how the athletics department will allocate its revenue to provide each of its teams with the financial support it deems necessary. According to the school’s president, provost and athletics director, the financial model that supports 36 sports is not sustainable with a budget of about $140 million a year. In the 2018-19 academic year – according to the most recent data available – the Cardinals spent $56 million on non-athletic expenses, $44 million on their football and basketball teams and $40 million on 33 other teams combined.
The Stanford Cups also saw the participation of the prestigious men’s volleyball program. The decision sent shock waves through the sports community, including coaches like Carl France who had hoped to one day run their own program. If Stanford can’t survive this budget crisis, then logically, smaller schools looking to expand sports can.
France, who was an assistant coach with NYU’s AVCA Division III men’s team last year, said he remains optimistic about his chances of becoming a head coach one day. But due to pandemic-related budget cuts, he wasn’t sure when such an opportunity would arise.
According to France, the sport felt like it was taking two steps forward and three steps back. Everyone was scared. We should all be tired of it.
Then, in January, Fairleigh Dickinson announced her intention to start a new program from scratch. France said he went from pleasant surprise to euphoria when he received a call from Gurbut in early February telling him he had been chosen to build the new team.
I was delighted. … It will create great opportunities for many young people, France said. I think there are progressive people here who believe in their vision of leadership through sport. FDU is in a good position to do so.
Hurlbut and Young say they wondered why more schools weren’t considering the same approach as Fairleigh Dickinson. They believe that one of the main reasons for these missed opportunities is the lack of proper communication between the athletics department and those who manage the university’s budget. They hope their decision to add more sports can inspire other schools to think about the benefits of developing their athletic departments.
We want others to think the same way, Hurlbut said. This is great for the growth of all these sports. This shows the value of Division I high school athletics. I hope this can turn the tide of sports competition and make people think differently.
Hurlbut said that since the announcement in January, he has received several calls from other schools evaluating their options for adding programs. However, the Knights remain a rarity in college sports this year.
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