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Sunday, April 18, 2021

College athletes are their schools’ most expensive costs. Why?

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Is college sports elitist? Perhaps. Does spending millions on the likes of a quail-hunting millionaire student-athlete waste millions on relics such as intercollegiate lacrosse teams? Possibly. But all these questions need to be seen in the context of the totality of college athletics.

In the U.S., college sports combine a business model that is economically sustainable, offers generations of students unparalleled exposure to world leaders and the world of college sports, and also offers enormous recreational advantages. It is largely this latter aspect that has drawn massive subsidies from alumni and institutions of higher education.

Perhaps this is a necessary part of college sports, but the dynamics of the subsidy are rather complex. (See a few brief overviews on these topics.) The overwhelming cost of college athletics is quite simply the teams themselves. Each team can support itself with its own facilities, students’ fees, financial aid, and institutional endowments, but that doesn’t mean the other costs are absorbed internally. A professor at some school might be a football and men’s basketball coach but he also coaches the tennis team. After athletics budgets, faculty budgets are the next-largest line item. Because universities are able to assign faculty salaries to other departments’ positions, athletics does not directly absorb much of the faculty’s expenses.

Here is another reality.

Prior to college athletics, many students viewed scholarships as illusory, after all athletes were competing against the supposed more skilled children of select athletes. Now sports have largely turned athletes into the most experienced and competitive students in their classes, and these students are given free admission to college just for their athletic achievements.

At the same time, these students — some of whom may have not fit the traditional mold for college entrants — need access to college sports to fit in with their classmates.

In a narrow sense, athletes need to play sports to fit in and distinguish themselves from their counterparts. But they also need access to sports to engage with their peers and make friends. College sports have become an important social and intellectual outlet — along with those other nearly universal college institutions, the a cappella groups.

See how soccer, the new hot thing in college athletics, is heading for peak popularity.

But what is the real cost of college sports? Where does one look?

For many schools the answer is as much about the field. The average athletic field size at a public university is 58,000 square feet, more than half the size of a football field. And this is just one end of the funnel.

The average baseball stadium (also shown in the chart below) also reaches 60,000 square feet, or almost four times the size of a typical college football stadium. At the University of Illinois — one of the country’s most populated public universities — each field house hosts a full-service cafeteria, the home locker rooms can fit more than 200 players, a weight room, gymnastics equipment, and cardio equipment, and an indoor batting cage. Many schools will allocate more than $50 million to athletic facilities, even for soccer teams.

According to a 2014 study by the Penn Wharton Budget Model, at the average four-year public school, campus athletic facilities cost upwards of $275 million, more than three times more than the average endowment of a private university. So the average university sports facility costs as much as the average university student.

The actual cost to universities of running and maintaining athletics is quite small. Schools like LSU and Michigan work for years to cover the operational costs of sports, and even then, these are not necessarily high.

Consider this startling statistic: Over a 10-year period ending in 2011, LSU spent $137 million on athletics, while $50 million went to its general operating budget. Similarly, Michigan spent $264 million on athletics, while its operating budget was only $130 million.

In the 20th century, school sports were free for everyone, but as college athletics became less free, it became increasingly priced for those of limited means. This means both institutions that find a cost-effective model to support an athletics program, and those that want to emphasize sports as a priority in their curriculum, will require the wealthiest of alumni to support athletics on campus.

As with other large public institutions, private universities like Stanford, Harvard, and Northwestern are not subject to the expenses of campus athletics. They do not have this problem. When it comes to athletics, they value the benefits.

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