Athletic Dept deficits

[Mr.G.Spot]

Maybe those people at the game go spend money doing something else fun in the State?

Highly unlikely since 6-7 home games are one-off events.

What is the DM/Ames corridor going to create to replace the revenue/money multiplier of 180,000 less attendees that would have attended 6 collegiate games? I am excluding the decrease in attendance for 40 (??) home men's/women's basketball games.

Increase the sin tax to preserve a cultural item in Iowa that has existed and grown over the past 130 years in the best/simplest thing to do.

Now if your position is "let's dismiss college sports in Iowa because we're going to create "XYZ" to replace that without any government involvement or subsidy" is a different conversation. I am interested what u would do to replace the economic impact of the 180,000 spenders without any municipal, county or state support for such new activity. If your answer is "let's let nature take its course to replace these economic activities," then, imo, this would takes years or even a generation to produce such results. Especially, without any government support to get these new activities started.

 

[simply1]

Utah State trying to increase student fees, but state government doesn’t seem on board.

Concerned about athletics, Utah State proposed charging each student $290 to keep the program afloat

The Utah Board of Higher Education said it was “unsustainable” for Utah State University students to cover that much of the cost for sports.

www.sltrib.com

In total, that would have meant each USU student paying $290 each year just in sports fees. That’s on top of the growing cost of tuition, now just more than $9,000 annually for the average student.

The board called it “unsustainable.”

“All of this is just band-aids. It’s band-aids on a gushing wound,” said board member Steve Neeleman, a USU alumnus who played football during his time there. “Sorry to be so graphic … but we’re going to be back here every single year having this same conversation unless we fix this model.”

 

[AuH2O]

Highly unlikely since 6-7 home games are one-off events.

What is the DM/Ames corridor going to create to replace the revenue/money multiplier of 180,000 less attendees that would have attended 6 collegiate games? I am excluding the decrease in attendance for 40 (??) home men's/women's basketball games.

Increase the sin tax to preserve a cultural item in Iowa that has existed and grown over the past 130 years in the best/simplest thing to do.

Now if your position is "let's dismiss college sports in Iowa because we're going to create "XYZ" to replace that without any government involvement or subsidy" is a different conversation. I am interested what u would do to replace the economic impact of the 180,000 spenders without any municipal, county or state support for such new activity. If your answer is "let's let nature take its course to replace these economic activities," then, imo, this would takes years or even a generation to produce such results. Especially, without any government support to get these new activities started.

I would like to think this analysis has been done to some level by ISU athletics and has been run up the chain. Obviously there are unknowns, but I'd think someone could look at several scenarios of attendance impact and see potential ROI for money to close the revenue sharing gap. Figuring out the math and ROI is easy. The hard part is agreeing on what ranges of lost attendance are realistic if there is a Rev sharing shortfall.

If I recall, total ticket revenue was $23M last year with FB being $17M and MBB being $4.8M. Then there would be some additional revenue from concessions, etc. but I would say that net is fairly small.

Saying $5M will prevent a 25% drop in ticket revenue might be reasonable. That case for a break even or slight ROI can probably be made. Trying to claim ticket revenue cuts in half if we don't get $10M to plug the hole is probably not a reasonable case.

Let's keep in mind years ago Branstad, BoR were all on board with funding the regents institutions based on in-state students, which of course makes complete and total sense considering the state subsidizes in-state students. But our idiotic legislature killed it because the massive gap of funding per student that U of I was getting would shrink. And the justification most frequently repeated was "...but U of I hospital..." even though it was clear a million times that U of I Hospitals had nothing to do with this specific BoR funding.

If ISU is going to get any favors from this legislature, particularly when the state is bleeding money, they have to make a pretty compelling case for ROI. And in some cases that won't even work. Our state is run by morons drawing up bills to entice the Bears to move to Iowa.

 

[HouClone]

Link?

Not sure exactly where, maybe 365 Sports, but it was shortly after NIL Go, basically last summer. Paraphrasing but what Pollard said was that he believed that NIL Go would allow the schools to be equal footing with each other. When the interviewer said that NIL Go was not 100% certain it could enforce collectives, Pollard doubled down on it, basically a cheerleader for NIL Go. That surprised me hearing him so confident. 365 Sports guys and Full Ride in the morning were skeptical. And they turned out to be right as NIL Go reversed themselves enforcing collectives.

Best link I could find is https://www.kcci.com/article/iowa-s...ay, we are helping,with Deloitte and NIL Go."

"We have aleady had five or six athletes go through NIL Go since July 1, and not one was over $5,000," Pollard said. "What was happening in the past was the donors were giving money to the collective, and then the collective was entering into an NIL deal for a million dollars for a student-athlete. That is not going to happen because it will never pass the litmus test with Deloitte and NIL Go.

A lot changed since Pollard's interview so he may have done a 180° and believe it won't work now.

 

[Mr.G.Spot]

I would like to think this analysis has been done to some level by ISU athletics and has been run up the chain. Obviously there are unknowns, but I'd think someone could look at several scenarios of attendance impact and see potential ROI for money to close the revenue sharing gap. Figuring out the math and ROI is easy. The hard part is agreeing on what ranges of lost attendance are realistic if there is a Rev sharing shortfall.

If I recall, total ticket revenue was $23M last year with FB being $17M and MBB being $4.8M. Then there would be some additional revenue from concessions, etc. but I would say that net is fairly small.

Saying $5M will prevent a 25% drop in ticket revenue might be reasonable. That case for a break even or slight ROI can probably be made. Trying to claim ticket revenue cuts in half if we don't get $10M to plug the hole is probably not a reasonable case.

Let's keep in mind years ago Branstad, BoR were all on board with funding the regents institutions based on in-state students, which of course makes complete and total sense considering the state subsidizes in-state students. But our idiotic legislature killed it because the massive gap of funding per student that U of I was getting would shrink. And the justification most frequently repeated was "...but U of I hospital..." even though it was clear a million times that U of I Hospitals had nothing to do with this specific BoR funding.

If ISU is going to get any favors from this legislature, particularly when the state is bleeding money, they have to make a pretty compelling case for ROI. And in some cases that won't even work. Our state is run by morons drawing up bills to entice the Bears to move to Iowa.

Gas, hotels, restaurants, tailgating food, lost wages of employees, tax revenue, etc are all part of the equation, plus the multiplier effect.

 

[BCClone]

I would like to think this analysis has been done to some level by ISU athletics and has been run up the chain. Obviously there are unknowns, but I'd think someone could look at several scenarios of attendance impact and see potential ROI for money to close the revenue sharing gap. Figuring out the math and ROI is easy. The hard part is agreeing on what ranges of lost attendance are realistic if there is a Rev sharing shortfall.

If I recall, total ticket revenue was $23M last year with FB being $17M and MBB being $4.8M. Then there would be some additional revenue from concessions, etc. but I would say that net is fairly small.

Saying $5M will prevent a 25% drop in ticket revenue might be reasonable. That case for a break even or slight ROI can probably be made. Trying to claim ticket revenue cuts in half if we don't get $10M to plug the hole is probably not a reasonable case.

Let's keep in mind years ago Branstad, BoR were all on board with funding the regents institutions based on in-state students, which of course makes complete and total sense considering the state subsidizes in-state students. But our idiotic legislature killed it because the massive gap of funding per student that U of I was getting would shrink. And the justification most frequently repeated was "...but U of I hospital..." even though it was clear a million times that U of I Hospitals had nothing to do with this specific BoR funding.

If ISU is going to get any favors from this legislature, particularly when the state is bleeding money, they have to make a pretty compelling case for ROI. And in some cases that won't even work. Our state is run by morons drawing up bills to entice the Bears to move to Iowa.

With the speed that concessions moves, it may be breakeven, especially in Hilton.

 

[NetflixAndClone]

 

[Marcelason78]

Surprisingly, this passed without much fanfare.

 

[aeroclone]

When a big money B1G school is getting that level of support from the university, you just can't deny that we are in a race to the bottom.

The whole point of all of this was for the athletes to get a piece of the revenue that they help generate. Tax dollars and university funds are not revenues that the athletes help generate. This should have been the mechanism that kept the payments in check. When the athletic departments run out of cash, the payments stop growing. Instead, they are going back to the taxpayers for a handout. This is all so stupid.

 

[Drew0311]

When a big money B1G school is getting that level of support from the university, you just can't deny that we are in a race to the bottom.

The whole point of all of this was for the athletes to get a piece of the revenue that they help generate. Tax dollars and university funds are not revenues that the athletes help generate. This should have been the mechanism that kept the payments in check. When the athletic departments run out of cash, the payments stop growing. Instead, they are going back to the taxpayers for a handout. This is all so stupid.

I agree. No way we can keep competing with this. They really need a salary cap on this stuff. I am not an expert on how they could do that. If congress needs to get involved. I can't even imagine some of the big boys will even be able to keep up with this. Kansas, UNC. It's basically going to end up being schools with a billionaire investor.

 

[ZorkClone]

Stuff like this makes it easy to see why the NFL can get states to foot the bill for billion dollar stadiums. Sports make some folks absolutely stupid with money.

 

[MartyFine]

 

[Cyhig]

Just shows college sports has a spending problem

 

[intrepid27]

Alabama doesn't have a deficit thanks to football.

I hope the "Bring back ISU Baseball !!" crowd reads this table.

 

[1SEIACLONE]

I hope the "Bring back ISU Baseball 111" crowd reads this table.

Like most colleges the only two sports that brings in more money than what it spends is football and MBB, all the rest lose money, the only question is how much. If you are in the B10 or SEC your media money from the networks brings in a lot more cash then schools in the B12 and ACC.
ISU could not afford to run a baseball program even if everyone wanted one without a large donation of tens of millions of dollars to make it happen,

 

[Challenger06]

Like most colleges the only two sports that brings in more money than what it spends is football and MBB, all the rest lose money, the only question is how much. If you are in the B10 or SEC your media money from the networks brings in a lot more cash then schools in the B12 and ACC.
ISU could not afford to run a baseball program even if everyone wanted one without a large donation of tens of millions of dollars to make it happen,

Even Penn State needed big donor Pegula to totally pay for construction of their new arena to start Div I hockey - and to endow hockey scholarships.
Over $100 million.

 

[VeloClone]

Plenty of teams with a lot of money aren’t in the conversation, plenty of teams with minimal money have been in the conversation.

College sports have always been the haves and have nots even when all the money was just dirty SEC under the table money

Yes, it was only the SEC that had that dirty under the table money...

 

[AuH2O]

Surprisingly, this passed without much fanfare.

Well, WI is running something like a $2.4 billion annual surplus, has a real GDP of like $350B and has one big state school to worry about.

Compared to a state like Iowa for example. Running a $1B deficit annually for a couple years, real GDP of like $200B and two power conference athletic departments.

In some states it’s a fairly small impact to the budget and they are in a great position to do it. Some are not.

 

[StPaulCyclone]

Maybe those people at the game go spend money doing something else fun in the State?

What about all the local and regional businesses that depend on the ADs of the three state schools? I don't recall the exact number but a single home game in Ames is worth something like ~$2MM to the local economy. There is a broader impact beyond the AD/University, who will also be negatively impacted. The greater economic ecosystem should be a consideration, as well.

 

[StPaulCyclone]

Not sure exactly where, maybe 365 Sports, but it was shortly after NIL Go, basically last summer. Paraphrasing but what Pollard said was that he believed that NIL Go would allow the schools to be equal footing with each other. When the interviewer said that NIL Go was not 100% certain it could enforce collectives, Pollard doubled down on it, basically a cheerleader for NIL Go. That surprised me hearing him so confident. 365 Sports guys and Full Ride in the morning were skeptical. And they turned out to be right as NIL Go reversed themselves enforcing collectives.

Best link I could find is https://www.kcci.com/article/iowa-state-sports-jamie-pollard-how-paying-players-works-cyclones/65448779#:~:text=That way, we are helping,with Deloitte and NIL Go."

"We have aleady had five or six athletes go through NIL Go since July 1, and not one was over $5,000," Pollard said. "What was happening in the past was the donors were giving money to the collective, and then the collective was entering into an NIL deal for a million dollars for a student-athlete. That is not going to happen because it will never pass the litmus test with Deloitte and NIL Go.

A lot changed since Pollard's interview so he may have done a 180° and believe it won't work now.

Yeah, I thinks it's fair to assume he believed that NIL Go would be able to enforce and it wasn't. His position has to have changed with the environment.