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Today's Wall Street Journal ran a story on the revenue football provides to 45 Division I big boys. It is an interesting read but I will mention that I do not see any former Valley members listed in the article. The article further highlights the disparity of the haves and the have nots.
When Football Is an Economic Strategy .Article Interactive Graphics Comments (6) more in College Football | Find New ».
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By RACHEL BACHMAN
Monday's matchup between No. 1 LSU and No. 2 Alabama in college football's national-championship game has sparked a mild debate over whether these two teams—whose meeting earlier this season resulted in a grindingly dull 9-6 LSU victory—are the best possible pairing.
LSU and Alabama are definitely the nation's top programs in another regard—how much football matters to a school's bottom line.
Based on information from NCAA financial-disclosure forms from 45 major-conference schools, which were reviewed by The Wall Street Journal, LSU and Alabama also rank No. 1 and No. 2 in the nation in the percentage of total campus revenue that's derived from football.
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.At LSU, for instance, the school reported annual football revenue of $69.4 million in 2009-10, a sum that includes everything from ticket sales and fan donations to conference TV payments. LSU also reported that its Baton Rouge, La., campus generated a total of $488.9 million in revenue from all sources, tuition included. By these figures, football accounted for 14% of LSU's gross income.
Alabama, which reported football revenue of $72.8 million in 2009-10 (the highest for any school sampled) and total campus revenues of $660.8 million, earned a final mark of 11%.
Though other teams—most noticeably Oklahoma State—have been in the hunt for the national title this season, LSU and Alabama have no real competition in the revenue game. Their percentages are far above the average for all schools (6%) and are significantly higher than the 9% figure posted by Arkansas and Tennessee, the next two teams down the list.
Other schools which had football teams playing in elite bowl games had far lower marks: These include Clemson (5%), West Virginia (3%) Wisconsin (2%) and Michigan (1%).
LSU chancellor Mike Martin said the school's 14% mark may actually understate the football team's financial impact. It doesn't capture, for instance, academic donations from alumni that were largely inspired by a connection to the football team. "I've never been at a place where people love it as passionately as the people at LSU," said Martin, who also has worked at universities in the Big Ten and Pac-12 conferences. "I do believe that donors and others put their money where their mouth is."
Alabama said school officials were unavailable for comment.
The Journal's ranking is based on standardized financial reports that the NCAA requires each Division I school to file annually using an outside, independent auditor. The NCAA uses the data to track financial trends.
Ben Jay, chief financial officer for Ohio State athletics, said these reports are a big improvement from previous practices—and are the best method available for making school-to-school comparisons.
That's not to say they're perfect. School officials say accounting practices can vary, and campus quirks can also skew the results. Private schools aren't required to release financial information because they aren't subject to public-disclosure laws. Universities that don't have medical schools, or those with medical schools located in another city, tend to show less campus revenue than schools with local medical campuses. LSU's medical school in New Orleans, which is on pace to generate $361 million in 2011-12 plus an additional $97 million in state funds, is not counted in LSU's campus total. If it was, the school's football revenue would fall to 7% of its total revenue, which would be only slightly above average.
The Revenue Bowl
The Journal looked at the total annual campus revenues reported by 45 major-conference schools and determined how much of that was generated by football. Here's a breakdown of the schools in the sample.
..In some ways, the revenue rankings mirror what's happening on the field. The Southeastern Conference, which includes LSU and Alabama—and will claim its sixth consecutive Bowl Championship Series title Monday—fills out eight of the nine spots in this football revenue ranking. At the same time, schools from the Big Ten and Pac-12, which have fallen off the pace, cluster toward the bottom.
The numbers also suggest schools that are rich in football aren't necessarily rich in all things. In its report, LSU said football earned $26.4 million in ticket sales, $25.7 million in contributions from fans and nearly $14 million in payments from the NCAA and SEC. Those revenues reflect both the relative size of LSU's following—Tiger Stadium seats over 92,000—and its fans' willingness to support it with donations that include priority seating. The Tigers generate about $4 million from each home football game, Martin said.
At the same time, LSU generated less than $500 million in revenues in 2009-10, one of the lowest totals on the Journal's list. Michigan, the school with the highest revenue in the sample, reported just over $6 billion in revenue.
LSU has embraced the idea and the reality of football as an economic engine for what Martin calls an "underfunded" university. In an open letter to fans posted online Tuesday, LSU athletic director Joe Alleva noted the contributions of his department to LSU's academic side in the midst of a $92 million plunge in state appropriations to LSU over three years. LSU athletics, driven by football, has contributed $5 million in sidewalk replacement and landscaping and $4 million in classroom repair, among other things.
Andy Schwarz, a San Francisco-area-based economist with the firm OSKR who tracks financial issues in college sports, said there's such a "high correlation" between big schools and big football programs that "an exception like LSU stands out dramatically."
Not that a low football revenue mark is always a sign of institutional perspective. Maryland ranks near the bottom of the list with a total football contribution of about 1%. But that number is less a function of its overall revenue than the $12 million it earns from football—dead last on the Journal's list.
According to Schwarz, these football revenue figures may understate the contribution football makes to the collegiate bottom line. He noted that many top football schools also list millions of dollars under "unallocated revenues" for athletics—at least some of which could be attributed to football.
Schwarz notes that while Alabama allocates 67% of its broadcast rights revenue to football, LSU attributes none of its reported $7 million in broadcast revenue to football.
Copyright 2011 Dow Jones & Company, Inc. All Rights Reserved
This copy is for your personal, non-commercial use only. Distribution and use of this material are governed by our Subscriber Agreement and by copyright law. For non-personal use or to order multiple copies, please contact Dow Jones Reprints at 1-800-843-0008 or visit
When Football Is an Economic Strategy .Article Interactive Graphics Comments (6) more in College Football | Find New ».
Email Print Save ↓ More .
.smaller Larger
By RACHEL BACHMAN
Monday's matchup between No. 1 LSU and No. 2 Alabama in college football's national-championship game has sparked a mild debate over whether these two teams—whose meeting earlier this season resulted in a grindingly dull 9-6 LSU victory—are the best possible pairing.
LSU and Alabama are definitely the nation's top programs in another regard—how much football matters to a school's bottom line.
Based on information from NCAA financial-disclosure forms from 45 major-conference schools, which were reviewed by The Wall Street Journal, LSU and Alabama also rank No. 1 and No. 2 in the nation in the percentage of total campus revenue that's derived from football.
View Interactive
Getty Images (2)
.At LSU, for instance, the school reported annual football revenue of $69.4 million in 2009-10, a sum that includes everything from ticket sales and fan donations to conference TV payments. LSU also reported that its Baton Rouge, La., campus generated a total of $488.9 million in revenue from all sources, tuition included. By these figures, football accounted for 14% of LSU's gross income.
Alabama, which reported football revenue of $72.8 million in 2009-10 (the highest for any school sampled) and total campus revenues of $660.8 million, earned a final mark of 11%.
Though other teams—most noticeably Oklahoma State—have been in the hunt for the national title this season, LSU and Alabama have no real competition in the revenue game. Their percentages are far above the average for all schools (6%) and are significantly higher than the 9% figure posted by Arkansas and Tennessee, the next two teams down the list.
Other schools which had football teams playing in elite bowl games had far lower marks: These include Clemson (5%), West Virginia (3%) Wisconsin (2%) and Michigan (1%).
LSU chancellor Mike Martin said the school's 14% mark may actually understate the football team's financial impact. It doesn't capture, for instance, academic donations from alumni that were largely inspired by a connection to the football team. "I've never been at a place where people love it as passionately as the people at LSU," said Martin, who also has worked at universities in the Big Ten and Pac-12 conferences. "I do believe that donors and others put their money where their mouth is."
Alabama said school officials were unavailable for comment.
The Journal's ranking is based on standardized financial reports that the NCAA requires each Division I school to file annually using an outside, independent auditor. The NCAA uses the data to track financial trends.
Ben Jay, chief financial officer for Ohio State athletics, said these reports are a big improvement from previous practices—and are the best method available for making school-to-school comparisons.
That's not to say they're perfect. School officials say accounting practices can vary, and campus quirks can also skew the results. Private schools aren't required to release financial information because they aren't subject to public-disclosure laws. Universities that don't have medical schools, or those with medical schools located in another city, tend to show less campus revenue than schools with local medical campuses. LSU's medical school in New Orleans, which is on pace to generate $361 million in 2011-12 plus an additional $97 million in state funds, is not counted in LSU's campus total. If it was, the school's football revenue would fall to 7% of its total revenue, which would be only slightly above average.
The Revenue Bowl
The Journal looked at the total annual campus revenues reported by 45 major-conference schools and determined how much of that was generated by football. Here's a breakdown of the schools in the sample.
..In some ways, the revenue rankings mirror what's happening on the field. The Southeastern Conference, which includes LSU and Alabama—and will claim its sixth consecutive Bowl Championship Series title Monday—fills out eight of the nine spots in this football revenue ranking. At the same time, schools from the Big Ten and Pac-12, which have fallen off the pace, cluster toward the bottom.
The numbers also suggest schools that are rich in football aren't necessarily rich in all things. In its report, LSU said football earned $26.4 million in ticket sales, $25.7 million in contributions from fans and nearly $14 million in payments from the NCAA and SEC. Those revenues reflect both the relative size of LSU's following—Tiger Stadium seats over 92,000—and its fans' willingness to support it with donations that include priority seating. The Tigers generate about $4 million from each home football game, Martin said.
At the same time, LSU generated less than $500 million in revenues in 2009-10, one of the lowest totals on the Journal's list. Michigan, the school with the highest revenue in the sample, reported just over $6 billion in revenue.
LSU has embraced the idea and the reality of football as an economic engine for what Martin calls an "underfunded" university. In an open letter to fans posted online Tuesday, LSU athletic director Joe Alleva noted the contributions of his department to LSU's academic side in the midst of a $92 million plunge in state appropriations to LSU over three years. LSU athletics, driven by football, has contributed $5 million in sidewalk replacement and landscaping and $4 million in classroom repair, among other things.
Andy Schwarz, a San Francisco-area-based economist with the firm OSKR who tracks financial issues in college sports, said there's such a "high correlation" between big schools and big football programs that "an exception like LSU stands out dramatically."
Not that a low football revenue mark is always a sign of institutional perspective. Maryland ranks near the bottom of the list with a total football contribution of about 1%. But that number is less a function of its overall revenue than the $12 million it earns from football—dead last on the Journal's list.
According to Schwarz, these football revenue figures may understate the contribution football makes to the collegiate bottom line. He noted that many top football schools also list millions of dollars under "unallocated revenues" for athletics—at least some of which could be attributed to football.
Schwarz notes that while Alabama allocates 67% of its broadcast rights revenue to football, LSU attributes none of its reported $7 million in broadcast revenue to football.
Copyright 2011 Dow Jones & Company, Inc. All Rights Reserved
This copy is for your personal, non-commercial use only. Distribution and use of this material are governed by our Subscriber Agreement and by copyright law. For non-personal use or to order multiple copies, please contact Dow Jones Reprints at 1-800-843-0008 or visit
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