Is the trade off "fair"/equivalent? (Money side of College Football)

Salary is a component of Operating Expenses, ONE function in the equation of Operating Income or EBITDA.

Regardless, I still see no convincing argument that any monies derived from the playing of successful football should somehow result in a guaranteed income for pine riders after they obtain a degree.

 

Though it is "one" function it is a MAJOR "one" function in most businesses. Labor cost is "one" component that if not kept under control by a department manager will get you fired quicker than you can imagine. Labor cost is one of the primary reasons we pay more for products. Businesses (as you well know) pass cost down to the consumer to keep their same profit margin.

I wouldn't either if so many people weren't getting financially set for life because of it, yet after they earn their degree they aren't promised crap. In my opinion the equation is severely unbalanced.

 

He's right. My boss is an Irish alum and let tell you he has one of the sharpest accounting minds I've been around. The education he received at ND truly prepared him to make a lot of money.

His stepdaughter (funny enough) goes to Alabama. He told me he looked at some of her assignments she had to do and said it was a joke compared to what he had to do at Notre Dame. Sad thing is he's right and I know it. It is very hard to get THE BEST athletes and also have them be scholars. People aren't perfect and most people aren't great athletes and highly intelligent as well.

 

The players receive meals, tons of clothing, tutoring, and a free education while in school and then after school will forever receive benefits, whether small or large, for being football players. Whether it is a free meal or a leg up in job interviews, the benefits of playing college football for a large program are definitely worth the income that those players generate

 

First of all, the stats I'm using are from the reports on '04-'05. The figures from '06-'07 have yet to be released.

A few notes about this...

Last year, the Ath. Dept did contribute to the University. The gave a check for 1 million to the general scholarship fund in one situation, but that doesn't consider the number of times monies from athletic events go to that fund. As example, with every game there is a contribution to the fund in honor of the player of the game. In '05, the Chevy award for the "Game-breaking Performance of the Week/Season" put 125K in that fund.

However, besides that 1 million...the rest is just gravy (translated: tax deductions for company's like Chevy )

Now, as to how the revenue is spent...and this report covers all the sports, not just football. (I can list football alone if you wish).

The total operating cost for these fiscal years mentioned is a hair under $57 million. Salaries account for about 25% of that. HOWEVER, when I say salaries you have to understand that includes everyone...clerical help, work-study, janitors, landscaping/grass cutting crews...all the way up to the HC's.

Other areas of expenses are Student Aid, travel expenses, equipment, recruiting, camps, spirit organizations...this list is extensive. Just the game day expenses (gas for buses, etc.) runs about 650K per year.

By comparison, when you look around the SEC you'll find a handful of programs that literally, scrape by. South Carolina, as example, isn't allowed to spend any money right now. Granted, they have their game day stuff in the budget but they are operating on a zero budget. (a profit of around 500K) Both MS schools are the same.

In terms of a strong (financially) Ath. Dept., Alabama ranks in the top 10 in the nation continually. We did so, even with the loss of millions during the recent probationary periods. That allows the program to spend the money it does.

HOWEVER, pointing to the revenue and trying to link it directly to the players in relation to the coaches salaries...it just doesn't go hand in hand. Heck, a good friend of mine was called in Dec for contributions to the coaching search. He wrote a check for 250K and told the two AD's he was meeting with if we signed 1 of 2 different coaches he'd give another 250K. (we did, he did).

Last, but not least, you'll find as many examples of kids graduating after playing 4 years of football and finding their "careers" as prison guards as you will those who are successful in business. The figures aren't any different than your normal college kids, unless, the players have the where-with-all to translate their experiences in college as a reason for a company to hire them.

 

I agree with you. Labor costs are a constant battle between bean counters and labor management (not in the union sense). But here's what happens when you try to maintain profit while keeping labor costs "in line". Accounting tells manager, your cost per widget produced is $5 and needs to be $4.50. Manager cuts corners to meet cost projection given to her by bean counter and product on the shelf sucks in terms of quality. Customer has to complain, return, or be unhappy with product, all of which lead to increased costs. Point being, accounting formulas are a necessary measurement of a company's health and well being but don't always tell the whole story.

On your other point, are you saying that coaches, etc are getting financially set for life while players aren't promised anything? If so, then so what? Many coaches are former pine riders themselves and likely have put in years of work including constant hirings/firings and relocations to continue their career. Athletes contribute for 3 or 4 years and then they're gone WITH a degree, connections via alumni, and a foot in many doors simply because of who they are and what they've done. They've had expert medical attention, top notch trainers and facilities, traveled, access to academic support, stipends to pay for food and clothes, and exposure to winning systems and a teamwork philosophy. Why should they be promised anything on top of that? At that age and relative inexperience, why should the equation be balanced for the player's sake? It's not like that in the real world and the sooner they become part of the real world the better. A suckling pig has to be weened eventually even if they are tomorrow's bacon.

 

Just so I'll follow correctly where does the AD draw most of it's operating funds from? What's its main source of "income" I guess you could say?

 

See above bolded text.

 

No offense meant by bean counter. It's a term we operations/mgmt people use with the utmost affection. :hihi: We've always referred to a meeting called by Accounting as going before the hanging judge. :lol:

I'm still unmoved by the thought of schools gaining revenue through the football program while the student/athletes leave under much better auspices under which they arrived and with far more opportunities than they would otherwise have had. Just a difference in perspective is all. :thumb:

 

1) Contributions.
2) Ticket Sales (which, btw, include donations made to booster org's like Tide Pride, IE: other donations)
3) Media Rights- for UA
4) NCAA/SEC Distributions
5) Student fees (none of this money is used for football or basketball)

There is very little difference in the $ figures from the rest, IE: concessions, 3rd party support, advertising/sponsership, and so on.

There are no monies received from Gov. support, direct or indirect institutional support either.

FWIW, the biggest expenses is facilities/maintenance and just something to chew on...Arkansas spends, on average, 3X more than any other SEC team on the same thing.