In 2001, Major League Baseball voted to eliminate two teams on the grounds that the Minnesota Twins and Montreal Expos had, in the words of the baseball commissioner, “a long record of failing to generate enough revenues to operate a viable major league franchise.”
The so-called “contraction” plan got called out on strikes by the courts. A quarter-century later, the Twins are still very much around; the Expos were sold (twice) and are now the Washington Nationals.
These days, Major League Baseball is looking at expanding, not contracting, at some point in the relatively near future, but the contraction plan is a reminder that sometimes even professional teams just don’t make it. The Cleveland Barons of the National Hockey League fell through the financial ice in 1978. Sometimes whole leagues fail, as fans of the late, lamented Virginia Squires of the American Basketball Association remember all too well.
This column isn’t about whether baseball should be played with a French-language public address system or whether the ABA’s red, white and blue basketball should still be bouncing; it’s about whether college sports can make money.
On one level, that question seems ridiculous. College sports are awash in dollars. The question, though, is where those dollars come from.
When this year’s 12-team College Football Playoffs got underway — with one of those teams being James Madison University — I looked at the revenue sources of those teams (and others). JMU stands out because of how much of its athletic budget (73%) comes from mandatory student fees. Looked at in dollar terms, JMU gets more of its athletic funding from mandatory student fees than any other college in the country.
The defense of requiring students to foot the ball for college sports that most of them don’t play generally falls into two categories.
The first is marketing — the contention that intercollegiate athletics make a school more attractive to potential students, intercollegiate athletics are good for maintaining alumni collections and intercollegiate athletics are good for a school’s name recognition. After all, 7.2 million people tuned in to watch JMU play Oregon, nearly 7.2 million more than those who would tune in to watch, say, one of the school’s chemistry professors lecture on the periodic table.
The second is some variation of “everybody does it” — that JMU (and other Virginia schools) get dinged for their high mandatory student fees simply because they’re more transparent in their accounting, while other schools hide those fees in some way.
The first point is a matter of opinion based on what you think the role of sports at a college should be; the second is more amenable to an objective determination. The Knight Foundation, in partnership with the Newhouse School of Public Communications at Syracuse University, has put together a database on college sports finances and takes into account whether some schools simply mask student fees under more general “institutional support.”
The short version: No, not everybody does it. Many schools don’t give much “institutional support” to their athletic programs, and some give none at all. These are often some of the best-known college sports programs in the country that you might think are subsidized by their schools, but aren’t. Instead, they rely on two things JMU doesn’t have: a big TV contract and a big donor base.
I’ve made that point before, so today I’ll explore a different angle: How many college sports programs in the country are truly self-supporting? To use the language that baseball’s Bud Selig once did, how many “generate enough revenues to operate a viable” college athletic program?
That answer is easy: none.
Every Division I college athletic program relies on donations — usually millions of dollars worth of them. It’s common to say that colleges are running professional sports programs, except that nobody is forking over millions in donations to the billionaire owners of pro sports franchises. In 2024, donors gave the University of Texas athletic program $137 million — more than any other school in the country collected. That accounted for 41% of the Longhorns’ athletic budget.
(The University of Virginia took in $38.8 million, or 25% of the athletic budget. Virginia Tech’s haul was $31.8 million, or 23% of the athletic budget. At JMU, donors ponied up just $5.68 million, covering just 7% of the budget, which forces the Dukes to look elsewhere — to the wallets of students.)
If colleges had to operate their sports programs the way the pros do, they couldn’t — not without donations.
That doesn’t really get at the point I’m trying to make, though. If donors want to give their money so their alma mater can pay more name, image and likeness money for the long snapper and not give it to the Little Sisters of the Poor, that’s their business. Instead, let’s look at what would happen if schools could not charge mandatory fees to students or rely on some kind of “institutional support” in any way. In other words, what if college sports programs were forced to be financially independent of their schools? How many college sports teams would we have then? (I’m not going to get into the teams playing at stadiums that the schools built and own. I’m just looking at the annual budget as documented in the Knight-Newhouse database.)
The answer is … 16.
That’s how many (or perhaps, how few) college sports programs appear to get zero support from their school, either through mandatory student fees or “institutional support.” All the rest are subsidized to some degree by one of those revenue streams or the other, usually both.
Here are the only college sports programs that stand on their own financially.
The Big Ten supplies exactly half of our fiscally independent schools: Iowa, Michigan, Nebraska, Ohio State, Oregon, Penn State, Purdue and Washington.
On the other end of the scale, the most heavily subsidized Big Ten program is newcomer UCLA, where 26% of the athletic budget comes either from institutional support (25%) or mandatory student fees (1%).
The Southeastern Conference sends six teams to our Sweet 16: Arkansas, Kentucky, Louisiana State, Mississippi State, Texas and Oklahoma.
The most heavily subsidized SEC program is Missouri, where the institution covers 16% of the cost of the athletic program.
Why do these two conferences dominate our Financial Independence Bowl? Because these are the conferences with the two biggest TV contracts — and then donors at those schools are especially generous when it comes to sports.
The Big 12 gives two surprise qualifiers: Kansas State and Oklahoma State. They’re not typical powerhouses on the field, but they make a go of it financially without forcing their students to pay or their institutions.
If, in some mythical world, we insisted on a strict separation of sports and school, we’d have just those 16 teams. However, many schools come close enough that if that really was the rule, they’d surely figure out some way to qualify. The eight that come closest: Alabama, 1% (all institutional); Georgia, 2% (all student fees); Iowa State, 1% (all student fees); Kansas, 1% (all institutional); Michigan State, 3% (all institutional); Mississippi, 2% (all institutional); Texas A&M, 2% (all institutional); and Wisconsin, 2% (all institutional).
That’s not a bad 24-team league, which underscores the point: The more athletically successful teams can afford to be financially independent. It’s all the other colleges that want to be at that level that have to find ways other than the free market and donors to fund their athletic programs.
You’ll notice one major conference conspicuously missing: the Atlantic Coast Conference. The private schools in the ACC don’t disclose their financial data. As private schools, they also have more leeway on how they spend their money in general. Among the state-supported schools in the ACC, Florida State is the least subsidized by students or the school, with 5% of its athletic funding coming from student fees (and none attributed to “institutional support). Clemson comes in at 7% (all institutional) and Louisville at 8% (7% institutional, 1% student fees).
For comparison, Virginia Tech gets 12% of its athletic funding from school-related sources (2% institutional, 10% student fees). Virginia is at 17% (6% institutional, 11% student fees).
James Madison, meanwhile, covers 75% of its athletic budget from school-related sources (2% institutional, 73% from student fees). That’s more in line with its fellow schools in the Sun Belt Conference, but it’s still on the high side. Only one other Sun Belt school is more dependent on school-related funding: 80% of Coastal Carolina’s athletic budget comes from the school in some way (64% institutional, 16% fees).
The other Virginia school in the Sun Belt, Old Dominion University, gets 61% of its athletic budget from student fees, with no institutional support listed.
Reality check: If Virginia were to ban those mandatory student fees (but keep “institutional support”), Virginia Tech would lose 10% of its athletic budget, Virginia 11%. Those schools could probably recover that in other ways — more donations, higher ticket prices and so forth. JMU, though, would see its athletic budget whacked by 73%, ODU by 61%. Those athletic programs simply could not survive in their present form.
JMU right now has the biggest budget, by far, of any school in the Sun Belt Conference — $76.3 million to Old Dominion’s $53 million and Appalachian State’s $51.9 million. As we’ve seen, though, the JMU and ODU budgets are propped up by mandatory student fees. Appalachian’s is, too, just not as much (fees cover 30% of its budget).
If the General Assembly eliminated those mandatory student fees, both the JMU and ODU budgets would fall to $20.6 million. They’d be at about half the funding of most Sun Belt schools, although just above the least-funded Sun Belt school, Louisiana-Monroe, at $18.2 million
That’s where the free market — as defined by conference payouts, ticket sales, corporate sponsorships and donations — says JMU and ODU should be. Those institutions want to compete at a higher level, though, and state law allows them to charge their students to do so. As a matter of state policy, the question is whether it’s in the public interest for JMU and ODU to make their students pay so those schools can have the best-funded athletic programs in the Sun Belt — or whether it’s in the public interest to reduce tuition even if that means reducing some schools’ athletic ambitions.
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