Temple faces league revenue drop

[MeanGreen61]

Philadelphia Inquirer story from the MUTS board.

Owls face drop in league revenue

Most of the schools in the Mid-American Conference are losing millions on football. But the Temple athletic department hopes to increase revenue in other ways.

By Frank Fitzpatrick

Inquirer Staff Writer

The promise of athletic riches was not what lured Temple football to the Mid-American Conference.

When the Owls officially enter the MAC in 2007, the drop-off may be more noticeable on their financial ledgers than on the field. They will be trading their roughly $1.5 million share of Big East Conference revenue for about a tenth of that in a league in which 10 of 14 football members lost a total of $22.8 million on football in 2003.

"We realize that our conference revenues will be declining and that our expenses won't be changing significantly," said Eric Roedl, Temple's associate athletic director for business and finance, not long after the Owls' May 17 announcement about joining the MAC. "But we're hoping to make up for that with increases on the revenue side."

According to figures filed with the U.S. Department of Education for 2003-04, among the 10 MAC schools reporting football deficits were Toledo ($3.3 million), Akron ($2.8 million), Bowling Green ($2.2 million) and now-departed Central Florida ($3.6 million).

Although those numbers showed that three MAC members (Ohio University; Miami, Ohio; and Central Michigan) broke even and one (Marshall) made a profit, league administrators said those four teams also received substantial university support.

That's because there are no standard accounting guidelines for filing under the Equity in Athletics Disclosure Act (EADA) with the federal government. Money that athletic departments get from the university to pay football bills often shows up as football-related revenue.

As a result, Roedl explained, Temple did not really break even on football in 2003, even though its EADA filing listed revenues and expenses of $7.9 million each.

To find a better reflection of the Owls' financial state, it's necessary to look in an EADA category called "non-gender-allocated revenue," which indicates how much money the athletic department got from sources not directly related to sports.

Temple listed $4.86 million there and, according to Roedl, its total subsidy to athletics was $14.6 million, a not-uncommon figure for public universities.

"The vast majority of them [public universities] lose a huge amount of money," said Temple president David Adamany. "There are only a handful that actually can fund their athletic programs out of the athletic programs."

And that, MAC school officials said, is normally how it works in their league, too. Still, the MAC isn't alone when it comes to football deficits.

In 2002, according to an Orlando Sentinel survey, 41 Division I-A schools posted football losses, most of them from the five I-A conferences, including the MAC, that aren't affiliated with the Bowl Championship Series. And in Division I-AA, conferences such as the Patriot League and Atlantic Ten rely on substantial institutional funding to sustain the sport.

The bulk of the BCS schools - Notre Dame and teams from the Atlantic Coast, Big East, Big Ten, Big Twelve, Pacific Ten and Southeastern Conferences - don't have that problem. Football pays the bills. The average BCS school budget is $30 million.

Those universities tend to have stadiums that are larger, fuller and more laden with amenities.

Though Marshall (which is leaving the MAC) earned less than $1 million for its appearance in 2004's PlainsCapital Fort Worth Bowl, BCS-affiliated bowls pay out as much $13 million to each team (a total then shared with league members).

For example, Ohio State of the Big Ten had overall sports revenue of $103 million. Ohio University of the MAC made $12.9 million.

That kind of earning power allows Ohio State and elite programs at universities such as Penn State, Texas and Alabama to support their entire athletic programs without school aid and still turn a profit. In the 1990s, the University of Florida's athletic program amassed $146 million in profits.

On the other hand, the average athletic revenue for MAC schools was between half and a third of that $30 million figure. They required significant institutional subsidies to operate football and the rest of their sports programs.

That money typically comes in the form of direct support from the university's general fund or from student fees levied for that purpose. Some schools get it from both sources.

"The majority of our funding is derived from the institution," said Kenneth L. Brown, the associate athletic director for business services at the MAC's Ball State, which spent $13.3 million on sports in 2003.

The EADA contains no specific category detailing how much money colleges redirect toward athletics. But several MAC business administrators said that the category of non-gender-allocated revenue was where to find that amount.

"The bulk of our non-gender-allocated revenue is in fact general-fund support," said Mike Malach, Eastern Michigan's associate athletic director for administration.

For MAC schools, those figures ranged from $3.5 million at Eastern Michigan to $16.5 million at Buffalo. Overall, the conference's 14 members in 2004 listed a total of $123.5 million in non-gender-allocated revenue.

Thanks to its various television deals, the NCAA distributes about $500,000 a year to Division I-A schools, not enough to get conferences such as the MAC off Poverty Row.

To wean themselves from reliance on university funds, league administrators noted, MAC schools would have to earn ticket and merchandise sales, fund-raising, and advertising and licensing agreements.

Or they could play more road games in hostile stadiums overflowing with supporters of their opponents.

In their quest for revenue, many MAC schools have been eager to make one-time appearances on the home schedules of BCS teams such as Penn State. Since 1998, the Nittany Lions have played seven MAC teams, all at Beaver Stadium.

The numbers were mixed. Penn State beat up on them, winning six of the seven games by a combined score of 266 to 108. But each of the cash-starved MAC schools earned guarantees as high as $425,000.

Edited June 21, 2005 by MeanGreen61