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March 28, 2010 - Colleges in Iowa weigh impact of athletic funding changes

In late March, the Iowa Board of Regents voted to consider eliminating or reducing the use of general fund money (revenue from taxpayers and students) for intercollegiate athletics.  The Des Moines Register reported on the debate as athletic departments in the state's three largest public universities -- the University of Iowa (U of I), Iowa State University (ISU), and the University of Northern Iowa (UNI) -- are responding to increasing pressure to become self-sustaining.  The resolution from the Regents asked for each school's president to provide in September an assessment of whether such a reduction is feasible. However, critics noted that such a proposal may lead to more external control over the athletic program by commercial interests and the likely reduction of non-revenue teams.

David Miles of West Des Moines, the regents' president, said the value of athletic programs to the universities may have changed.  "There is an educational value, and there is a value to the universities," Miles said. "But there is a real question as to whether that value is sufficient given the challenging financial times that we face to justify ongoing taxpayer support. I would prefer that we find other sources of revenue."

Over the last ten years, the amount of tax and student money going into college athletics in Iowa has been reduced.  In 2001, the University of Iowa's athletics department received 6 percent of its revenue from the U of I general fund. Iowa State University athletics received about 10 percent; UNI received 52 percent. Now, the U of I receives $882,000 for tuition reimbursement, with help from $10 million annually that U of I athletics receives from the Big Ten Network. ISU now receives about $1.6 million from the school's general fund. However, institutional support at UNI remains significant with general fund money now makes up 42 percent of the UNI athletic budget. UNI offers 18 sports programs and has just over 400 athletes. UNI athletics is to receive $4.6 million from the university's $155.7 million general fund.

Hans Isakson, a professor of economics at UNI, has helped push two resolutions through the Northern Iowa Faculty Senate urging reduction of the amount of money spent on athletics and other auxiliary enterprises.

"I am not against intercollegiate athletics," Isakson said. "But when a university is going through budget cuts and salary cuts, we need to protect the integrity of our core academic mission, then hack away a little more around the edges and make more cuts that won't affect our educational mission."

"There are only 25 schools that actually make money at their sports programs," said Daniel Fulks, an accounting professor at Transylvania University in Kentucky and author of the NCAA's biennial report on revenues and expenses for all NCAA schools.  The average profit for those 25 schools is $4 million, compared with the average deficit of $8 million for the rest of the division, Fulks' study found.

Christine Grant, former women's athletic director at the University of Iowa, said those who dispute the influence of outsiders on athletics need only look at how men's and women's basketball games are played at times picked by television executives, not school officials or conference officials.

"We at the institution should be controlling everything within the athletic program for the protection of the student-athletes," Grant said. "We are talking about using student-athletes and their skills to bring in money to help fund a program.  But where is the line? When you start catering to external sources, there are decisions that get made that aren't in the best interests of our student-athletes," she said.

Grant conducted an analysis of intercollegiate athletic finances among NCAA members over the past 20 years which showed the net loss of nearly 300 men's sports programs, even though spending on athletics at Division I schools has skyrocketed.  At the same time, schools competing in the NCAA's Division II and Division III have added men's sports - 146 in Division II and 346 in Division III.

"We have sold everything that it is possible to sell to try to keep competing with each other, but what has it gotten us in Division I?" Grant asked. "Fewer men's sports and football coaches who are paid as if they are chief executive officers of major corporations.

The presidents of the three institutions were asked to develop plans to eliminate or reduce substantially general fund subsidies to their athletic departments.