Lack of revenue leads to deficits for WSU athletics

0

Lack of revenue leads to deficits for WSU athletics

Our reporters closely watch your tax dollars. For past stories on Wright State University and other I-Team stories see MyDaytonDailyNews.com.

Wright State spends less per athlete than any Ohio public university offering Division I sports, but paltry revenue totals have caused its athletic department to operate at a deficit for nine straight years.

The Dayton Daily News examined the athletic budget in the wake of the financial struggles that are causing the university to cut nearly $20 million from its two-year operating budget.

Some faculty members have called on the administration to scale back its commitment to the athletic programs, which have received subsidies from the university totaling $104.6 million since 2002.

Enough is enough, says Rudy Fichtenbaum, a retired WSU economics professor and current president of the American Association of University Professors, the faculty union.

In a letter to WSU Vice President of Finance Jeff Ulliman, Fichtenbaum said: “It is absolutely an outrage that the administration is cutting positions that are going to directly affect the quality of the academic programs that we offer to students while continuing to shovel money into the bottomless pit known as intercollegiate athletics.”

Wright State administrators defend the spending on athletics, saying it’s a huge benefit to the university.

“We’re very responsible in terms of budget,” said Dan Abrahamowicz, WSU Vice President for Student Affairs. “The athletics program brings so much to this university that is hard to quantify with dollars and cents. The value goes well beyond the cost, it seems to me.”

Subsidies are common

The practice of subsidizing college athletics through student fees or general funds is not unusual. In fact, Ohio State is the only self-supporting university in the state — and one of just two-dozen across the nation — that operates without subsidies, according to a USA Today database of athletic finances at public universities.

But the boost Wright State provides is significant. About 78 percent of its athletic revenue comes from the institution, according to WSU’s most recent annual report, and in the last decade those subsidies have increased by 34 percent.

Statewide, only Cleveland State University sports are more reliant on cash infusions from the administration. Wright State doesn’t have football, which drives revenue — and spending — at many schools.

Not everyone wants to cut the athletic budget, which this year is $10.3 million. That’s less than what it was two years ago.

Professor emeritus Lawrence Prochaska chaired the University Athletic Council for three years and headed up a committee that reviewed the athletic department budget last year. He said Wright State compares favorably with fellow Horizon League members and other Ohio universities when the expensive sport of football is taken out of the equation.

“We told the academic senate that we thought the (budget) overrun is due to under-funding of athletics,” Prochaska said. “It’s not due to capricious financial expenditures.

“We concluded that they should give (WSU athletic director) Bob Grant a hard budget and make him live with it. They have to decide what that budget is.”

Other Ohio schools

All the athletic programs in the state are dwarfed by Ohio State, whose $167 million athletics program is carried on the backs of its football and basketball teams. OSU is part of the so-called “Power Five” conferences that enjoy lucrative television contracts. Even after OSU spent $9.8 million on team travel, $1.9 million on recruiting, $28 million on coaches’ salaries and $27.6 million on support staff in 2015, it still made enough money to send $38 million back to the university’s general fund.

But it is a different story elsewhere in Ohio. The state’s other 10 Division I college athletics programs collectively received about $160 million in university subsidies in 2015, according to state audits. The University of Cincinnati had the lowest percentage of revenue coming from its administration — 41 percent of the $52.5 million it took in.

The University of Akron provided the most money to athletics — $22.1 million — followed closely by Cincinnati ($21.7 million) and Miami University ($21.2 million).

The University of Toledo operated at a deficit in 2015, going $3.8 million in the red. Toledo and Wright State ($985,520) were the only Ohio Division I schools to report deficits.

Value vs. cost

Wright State did match OSU in one respect: It was the only other Ohio Division I school to shrink per-athlete spending, cutting expenses by 4 percent since 2009 and spending an average of $38,747 per athlete in 2014.

WSU offers 16 varsity sports.

Wright State’s athletic budget was about $10.7 million in the fiscal year ending in June 2015, the most recent figures available from the state. That accounted for about 3 percent of the university’s total budget.

An NCAA report released two years ago found that non-football Division I schools spent, on average, 6 percent of their overall budgets on athletics.

Abrahamowicz said last year’s athletics budget was $10.2 million, and the proposed budget for the fiscal year that began this month is $10.3 million.

Grant points out that WSU’s 300-some student-athletes paid $1.3 million in tuition to the university last year. Only athletes in men’s and women’s basketball and volleyball receive full scholarships.

“From the time I took over eight years ago, my charge has been to spend as little as possible while delivering as successful as possible a mid-major program as we can,” Grant said. “I think we’re doing fine. We want to do better; we need to do better.”

Martin Kich, president of the faculty union at Wright State, said there is a double standard at the school, with the academic units asked to cut their budgets while athletics is merely pressured to not overrun its budget.

“That’s ludicrous. Absolutely ludicrous,” he said. “You’re sending the message that athletics is more important than academics. Very clearly.”

‘Crucial draw’

The push and pull between those who want more athletic spending and those who want less is not unusual for a mid-major school like Wright State.

Abrahamowicz said the university needs to define exactly what it wants from its athletics program, and fund it accordingly.

“Certainly, athletics overspends its budget, and something’s got to be done with that in the long-term,” Abrahamowicz said. But, he said, “There is no sentiment around here to not be Division I, except among some who aren’t happy with athletics.”

Koty Johnson, a WSU senior majoring in accounting and finance, said Division I sports are crucial for students seeking the quintessential college experience.

“Me and a group of my buddies go to just about every home basketball game and try to make it out to a couple of soccer games and baseball games each year,” said Johnson, vice president of the Wright State student body.

He acknowledged, though, that he isn’t aware of the cost: “I’m not 100 percent sure, honestly, about how much of my tuition goes to intercollegiate athletics.”

Grant is counting on new men’s basketball coach Scott Nagy to provide a revenue boost for the university, saying, “Our best chance for success financially really starts and ends with men’s basketball.”

Men’s basketball ticket sales, donations and corporate sponsorships accounted for more than $600,000 in 2015. That did not even cover the cost of the team’s scholarships and its $275,000 travel tab.

While the Nutter Center seats 10,500, on average just 4,355 fans attended the Raiders’ home games this past season, which is slightly below the national average of 4,744 for Division I programs.

WSU fired its coach, Billy Donlon, after the season and hired Nagy away from South Dakota State, paying him more than twice what it paid Donlon.

‘Day of reckoning’

University administrators and boosters often insist that sports programs drive enrollment, add to campus life, provide valuable opportunities for student-athletes, and help fundraising and marketing, said Ohio University Associate Professor of Sports Administration B. David Ridpath.

But athletic success can both be fleeting and expensive, said Ridpath. Perhaps the worst scenario is to be the Cinderella team in the NCAA basketball tournament because boosters, fans and administrators believe that such success can be repeated and pressure mounts to spend and build more, he said.

“That’s what drives a school like Wright State. They tend to think that being a Division I program and having that chance of getting on the cover of USA Today and being on ESPN will somehow enhance the entire university,” Ridpath said. “Really, research is pretty clear that while there might be some short-term gains in enrollment, fundraising, brand recognition, it usually trickles off after a year or so.”

Because of the costs involved, Ridpath believes the “day of reckoning” is here and more schools will do what the University of Idaho did and drop out of Division I.

“I think other schools should really consider that,” he said. “I think they’ll find it will have not one iota of the negative effect on the university. In fact, I think net gains will be positive.”

View Comments 0

Weather and Traffic