Rutgers Athletic Finances, Part 1: And just how are we turning that corner?

Part 1

Like every other school, Rutgers filed its 2015 (2014-15 school year) NCAA finance report.  And we obtained it through an Open Public Records Act request.  As we reported, the news was pretty good. The "subsidy", the direct institutional support as the NCAA report calls it, for Rutgers athletics had declined by almost 35%. And the Rutgers administration was quick to say that this was a sign of things to come.

I think what it does is it confirms what folks here have been saying for a while and that is the trend is going to continue. You are going to see the institutional support decline as we move toward full participation in the Big Ten"

--- Athletic Director Pat Hobbs

But how did that happen?  Less money from the University, but where did the money to support the program come from?  And how does it compare with other schools in the Big Ten?

Student Fees

One of the concerns/complaints around Rutgers has been that too much is taken from student fees to support athletics.  Of course, part of student fees goes to letting students into contests for free.  And people might argue that it isn't fair for those students who don't attend contests. But student fees also support other activities, such as buses and non-athletic student activities. Not every student takes advantage of those. It's a wash, so let's focus on how much.

One of our Big Ten peers, Purdue, has been used as an example of a school that actually "makes" money, or at least minimizes how much it takes from the school in support of athletics.  Or how much it doesn't takes from student fees.  And then there is the extreme Big Ten "peer": Ohio State.  Those are our comparisons for this discussion.

In its first year in the Big Ten, Rutgers provided athletics with just under $11 million in student fees.  Compare that with zero dollars at Purdue or OSU.  And, in all honesty, the amount at RU has increased over the last three years.

So is there good news on funding?  That's a resounding yes.  Because in almost every area of revenue, Rutgers' participation as a Big Ten school has benefited the athletic budget. Both donations to athletics and ticket sales increased significantly as a Big Ten member. The numbers show an uptrend, including the last year in the AAC when people knew the Big Ten was on the horizon.

Ticket Sales

Rutgers charges admission for only nine of its 24 sports: Football, Men's and Women's Basketball, Men's and Women's Soccer, Men's and Women's Lacrosse, Gymnastics, and Wrestling. For wrestling and gymnastics, charging for tickets is only a few years old. But in both cases, it has been a positive and has not hurt attendance.

By comparison, the other two peers we are looking at are at opposite poles.  Rutgers did about $4 million better than Purdue with ticket sales.  Purdue charges for only eight sports, but it only sponsors 20 compared to RU's 24.  Of course, tOSU did better....than both Rutgers and Purdue combined.  Ohio State's $63.1 million in tickets was almost three times the total for Rutgers and Purdue. The Buckeyes only charge admission for nine of their 34 sports.

In looking at the chart, one starts to question whether Rutgers will ever (or at least in my lifetime. . . .maybe my children's, too) catch up, or be close, to Ohio State.  On the other hand, becoming an "equal" with Purdue seems far more realistic.

Donations

The recent announcement by Rutgers of a targeted $100 million campaign to build/renovate athletic facilities focused on the need - the absolute requirement - that it be accomplished with gifts, not state or University money.  How realistic is that?  Well, it had better be realistic or the construction won't take place.  But, that hasn't been the pattern at Rutgers, although it needs to be from this point forward.  And what has Rutgers accomplished with donations in the past? It has gotten better, as shown in the chart below, but those numbers are a far cry from $100 million..

As far as growth goes, it isn't too bad.  Until you see how the other half -- or, in our study two-thirds -- live.  Again, Ohio State is in its own universe.  But even the Boilermakers outpace Rutgers by a considerable amount.  In 2014-15, Purdue took in almost twice as much as Rutgers did.  Ohio State donors more than doubled the other two schools' contributions.

The numbers are better for Rutgers today than they used to be, and the trend is upward. But the schools we're chasing have a head start and are already doing better in fundraising. What's an athletic department to do?

Up next we'll look at some details of the Rutgers financial report; who giveth and who taketh away