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July 2, 2012 - Maryland athletics’ financial woes reveal a broken college sports revenue model

A recent Washington Post article examined the financial situation in the University of Maryland’s athletics program in light of its recent decision to eliminate seven of its 27 varsity athletic teams next year.

The article notes that “athletic departments at nine out of 10 public universities that compete in big-time sports spent more money than they generated last year…” and that “many are grappling with the question of whether dropping some sports is the solution.”

William E. “Brit” Kirwan, chancellor of the University System of Maryland and a co-chairman of the Knight Commission on Intercollegiate Athletics is quoted: “Quite frankly, I think we’ve gotten ourselves in a terrible situation with intercollegiate athletics, with the cost of running a program really out of proportion to the basic purpose of our universities.”

In describing the factors behind the “escalating financial pressures” in athletics, the article cites Knight Commission research showing that athletics spending is rising at nearly twice the rate of spending on academics.

The section titled “Where to go from here?” highlights the Knight Commission’s 2010 report:

“So what’s the remedy for college sports’ spending compulsion?

The Knight Commission, a group of university presidents, trustees and former athletes who advocate for reform in college sports, offered a road map in a 2010 report, “Restoring the Balance: Dollars, Values and the Future of College Sports.” In it, the panel recommended the NCAA require colleges to publish the true cost of their athletic programs in comparable, complete terms, reflecting not only revenue and expenses but also the often-hidden debt service on facilities and subsidies from their universities’ general funds.

It also proposed that the NCAA cap the number of “non-coaching” jobs on certain teams — an expense that has ballooned in football, for example, with the addition of directors of football recruiting, operations, player development and strength-and-conditioning coaches for every position. And it recommended the NCAA reduce the number of football scholarships allowed by at least 10 from the current 85.”