College Athletic Departments: The Business Behind It All

Brittany JacobsCorrespondent INovember 12, 2009

AUSTIN, TX - NOVEMBER 07:  Cornerback Curtis Brown #3 of the Texas Longhorns practices before a game against the UCF Knights on November 7, 2009 at Darrell K Royal - Texas Memorial Stadium in Austin, Texas.  Texas won 35-3.  (Photo by Brian Bahr/Getty Images)
Brian Bahr/Getty Images

We've all heard complaints of athletic departments losing money, about football and Men's basketball teams having to support the "non-revenue" sports and failing. 

According to the NCAA, colleges and universities paid about 3.6 billion dollars to support their teams last year.  With the vast majority of collegiate athletic departments being subsidized by their respective university, we often overlook the handful that are breaking even, if not creating mass amounts of revenue.

According to the Equity in Athletics Disclosure Act documents filed by each school to the U.S. Department of Education, the top five grossing collegiate athletic departments are as follows:

1. The University of Texas- $120 million (72.9 of which was football revenue)

2. Ohio State University - $117.9 million

3. The University of Florida - $106 million

4. The University of Michigan- $99 million

5. The University of Wisconsin- $93.4 million

The top three grossing teams in the land, The University of Texas, Ohio State University, and The University of Florida, all flourish within self-sufficient, almost completely autonomous athletic departments.  Although they fly the flags and wear the logos, the athletic departments of many "big name" Universities are no longer truly related to the school.

The problem with self-sufficient athletic departments (or should I call them corporations?) is that the university has very little authority over them.  The athletic department at UT (University of Texas) grosses $120 million and gives back $1.5 million to the school, they also contribute 5% of licensing and merchandising revenue.  The athletic department itself is leery about giving money back to the school stating. "We have to be careful," said Nick Voinis, associate athletics director for communications. "You don't want to give money to, say, the business school, because then the engineering school will ask for money."

The same premise holds for Ohio State.  According to their athletics website "The Department of Athletics is completely self-supporting and receives no university monies, tax dollars or student fees. In Fiscal Year 2009-10, the Department of Athletics will transfer back to the University more than $29 million in assessments, including $14.5 million in grant-in-aid costs." 

This sounds like quite a hefty sum, however, when you consider that the Athletic Department is still making at least $88.9 million, you have to stop and question where the remaining funds are allocated.  Is it really necessary to spend almost 90 million dollars EVERY YEAR on a collegiate athletic program?

Even the University of Michigan athletic department (which is not a self-sufficient or considered a separate entity) has a sports website that is flooded with advertisements.  From AT&T to CBS, State Farm to Bank of America; college sports and their athletic departments are becoming a business.

I'm not saying that it's right or wrong. Personally, I wish that I would have thought to turn the athletic department of a Division I school into a profitable business (Hook em' Horns!!).  But I do believe that athletic departments are first and foremost a part of the University. Giving back and supporting the academic aspects of the school should be a must.

In the future, there may need to be some checks and balances in order to prevent the exponential growth of university athletic departments and to ensure that these sports teams are not becoming professional teams with a collegiate title.  Afterall collegiate athletics are supposed to be "Amateur" sports.