'Slumping' Economy Hits Athletic Departments

Just 14 of the 120 schools in the Football Bowl Subdivision made money from their athletic departments in the 2009 fiscal year, a 44 percent decline from the previous year, according to an August 17 NCAA  report. Duke is not among the 14, said Chris Kennedy, deputy director of athletics.

The schools, formally known as Division-IA and colloquially known as Division I, also spent more money to maintain their athletic programs, with the median amount rising to $10.2 million from about $8 million last year, according to the data complied by Transylvania University faculty member Dan Fulks. NCAA Interim President Jim Isch, who was previously the organization's chief financial officer, said institutions tend to set their expenses two or three years in advance, and revenue is a "more real-time budgetary phenomenon."

“While some might be quick to claim that the increases are the result of runaway spending, the more likely scenario is that due to the economy, institutions did not realize anticipated revenue to keep up with fixed costs,” he said.

The Associated Press reported that Fulks confirmed Texas, Missouri, Alabama, Florida, Ohio State and Tennessee were among the 14 profitable athletic departments. It is "very hard" to compare different athletic departments because they each have their own ways of accounting for revenues and expenses, Kennedy said in a phone interview. Out of Duke's 24 sports, two make money, and the department ended the year with its budget, which includes a subsidy from the university "in the black," he said.

The median generated revenue (dollars earned directly by the athletics department from sources such as ticket sales and media contracts) by the FBS as a whole increased by  5.8 percent, down from a 17 percent  increase during the 2008 fiscal year. At the same time, median total expenses increased by 10.9 percent,  compared with 5.5 percent in 2008.

Coaches’ and staff salaries and athletic scholarships continued to make up nearly half of total expenses for the FBS, with salaries accounting for 33 percent and scholarships 15 percent. The Chronicle reported in July that Iron Dukes, the athletic department's fundraising arm, donated about $10.7 million out of a total $13.3 million directed to athletically related student aid, according to the Equity in Athletics Disclosure Act form.