The problem with measuring net athletic revenue

The Department of Education's Office of Postsecondary Education just released its Equity in Athletics report for the 2008-2009 season. (On the Banks has extensively covered the OPE data in past posts). This week Brett McMurphy (who I generally enjoy, going back to his days covering USF) has posted a three part summary of the report on Fanhouse. The third part compares basketball to football spending. The first part about football expenditures is fair enough, although not nearly as interesting as an athletic department's net revenue. That's where part two is supposed to come in, although it ends up being highly misleading and not all that informative.

The reason why has to do with the way that the OPE compiles its data. If you go to the report url linked above, and search for information on any particular program, you'll notice that looking at an athletic department's programs revenues and expenses does not specify whether or not any so-called revenue comes from a direct institutional subsidy, meaning that the money came from a payment from a university's general fund. Rutgers in particular is shown as breaking even in every sport except men's basketball (which generates a small profit due to its low costs.)

There are some advantages to the OPE report, in that it breaks down some data for each program by sport, and includes private schools and Pennsylivania's "state-related" institutions (Penn State, Pitt, and Temple.) Those are the two main flaws of USA Today's rival database, which launched earlier in the year after a round of public records requests (targeting revenue and expense reports submitted to the NCAA, which has different requirements than the OPE). As glaring as those problems are, USA Today's compilation is still far more informative owing to its inclusion of the institutional support data. The DOE reports are compiled for the purposes of measuring gender equity, not athletic subsidies. One still cannot say with any confidence whether or not, say, Rutgers football made a profit or lost money last year, but it is clear that the athletic department budget as a whole was heavily subsidized (non-revenue sports are called non-revenue for a reason.)

I haven't studied the methodology of the reports in detail, but clearly something must be up when Texas is reported as making $65 million dollars with its football program in one, and and $11 million for the entire athletic department in the other (one guess for the discrepancy is how USA Today measures booster support). Ideally, the flaws in both would be addressed and there would be one uniform and transparent research tool available to the public to break down college athletic spending. IIRC the Knight Commission's recent report included remarks to that effect. Until that happens, the institutional support oversight is just so glaring that I can only trust USA Today's figures.

Again, I'm a fan of McMurphy, but he really did his readers a disservice by not including a disclaimer to that effect in giant, red, bolded flashing letters. Likewise, kudos to journalists like Adam Zagoria and Brendan Prunty who have cited the USA Today's figures in recent weeks, placing emphasis on the topic of direct institutional support. Sorry to be so pedantic and repetitive on this topic, but it's sort of a personal crusade of mine to see the college football community and sports media do a more comprehensive and intellectually honest job quantifying the financial aspects of sports, college or otherwise.

Update: for reference, this aggregate NCAA report is a great sports-specific breakdown.

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