University Financing - If you want to educate yourself

[Go Canes!!]

I understand everything you said but in a more reasonable manner, let me ask you again a previous question. If an athletic department has been mediocre for over 15 years, primarily due to hiring low level coaches and not paying very much, and truly wants to adequately compete, how do they not properly plan the budget and reassess annually? More so, knowing current salaries and properly planning in case of failure, to pay a contract (even worse after not learning from 4 premature extensions) that they negotiated in advance?

College football today is not the same game it was 15-20 years ago. The Adidas deal, the latest football and basketball TV deals and the upcoming ACC Network have put us the closest we've ever been to equal footing financially to other big time programs.

But even with that the gap is still huge. We started way behind and other schools have been spending bigger numbers than ever.

 

[duke4heisman]

College football today is not the same game it was 15-20 years ago. The Adidas deal, the latest football and basketball TV deals and the upcoming ACC Network have put us the closest we've ever been to equal footing financially to other big time programs.

But even with that the gap is still huge. We started way behind and other schools have been spending bigger numbers than ever.

I get that too but I'm more concerned with their salaries being paid and contracts negotiated in advance without properly planning ahead and updating annually as a buffer for possible failure. I do hope the increase in the aforementioned areas and especially the ACC Network money will allow them to begin to allocate more in advance to compete much better in the future. However, it doesn't seem like they're doing that now, with current and prior situations

 

[CashMoneyCane]

+10.

Nice work and well laid out.

Much thanks for the love on this. It needed to be said.

 

[CashMoneyCane]

I h


I honestly don’t know the specifics beyond you are open to the tax is you have more than 500 students and an endowment of more than $250k or 300k per student (forget which). So it is a pretty sizable number of universities that are susceptible to it. I think this is the reason behind NYU giving med students free tuition and similar stories. It was part of last year’s tax reform.

Pretty sizable number that are susceptible ASSUMING they generate investment income not spent on the institution, which will be very few and far between (except any Trump U).

 

[CashMoneyCane]

Here's an article showing estimated expenses by school. Most ACC Schools reported about $11-$14 million in expenses with another showing ACC schools receiving $27 million each. And that's before the launch of the ACC Network.

Revenues have really exploded in that sport in the last decade or so.


https://www.midmajormadness.com/201...ics-college-basketball-2016-gonzaga-mid-major

https://www.foxsports.com/college-f...r-boost-with-2019-launch-of-tv-channel-082918

Thanks for this insight. Not going to disagree. Regardless, the point is that most athletic departments ultimately break even.

 

[CashMoneyCane]

I understand everything you said but in a more reasonable manner, let me ask you again a previous question. If an athletic department has been mediocre for over 15 years, primarily due to hiring low level coaches and not paying very much, and truly wants to adequately compete, how do they not properly plan the budget and reassess annually? More so, knowing current salaries and properly planning in case of failure, to pay a contract (even worse after not learning from 4 premature extensions) that they negotiated in advance?

My response to this would be that the Trustees are cheap (as they reasonably should be given the overall financial situation and prioritization of academics over sports) and held on to the belief for WAY too long that they could continue to hire on a budget, given the success from the 80's to the early 00's.

You have to view all of this in the context that college football, from a revenue/arms race standpoint, only exploded since roughly 2000.

 

[OptimusCreampie]

The death of UM football was when they joined the ACC, guaranteed revenue they didnt have to work for it no more. That was the nail

Oh yeah made a similar thread earlier this year

 

[CashMoneyCane]

Plus we’re the only university in America that has to rent a **** stadium.

Honestly, not sure how much of a financial burden this really is vs. owning. It might be a blessing for us. I don't know.

 

[CashMoneyCane]

So if Manny would've stayed and we ponied up 1.5 mill could we also pay for an OC.
Yes or No.
In other words do we have the financing to pay the same amount that the teams in the playoffs pay for their staffs.

Either 1) No, we don't, or 2) We're not willing to. I'd go with option 1. Can we move around $500K? Sure. Can we staff like Bama, Texas, OSU, etc etc? Absolutely not.

 

[CashMoneyCane]

I get that too but I'm more concerned with their salaries being paid and contracts negotiated in advance without properly planning ahead and updating annually as a buffer for possible failure. I do hope the increase in the aforementioned areas and especially the ACC Network money will allow them to begin to allocate more in advance to compete much better in the future. However, it doesn't seem like they're doing that now, with current and prior situations

I think you're honestly starting to see this for the first time with the Richt hire. Say what you will about him as a coach, but it was a huge step for the University to finally acknowledge and accept they need to pay more for football coaches.

Thank Blake James for that, at least.

 

[duke4heisman]

My response to this would be that the Trustees are cheap (as they reasonably should be given the overall financial situation and prioritization of academics over sports) and held on to the belief for WAY too long that they could continue to hire on a budget, given the success from the 80's to the early 00's.

You have to view all of this in the context that college football, from a revenue/arms race standpoint, only exploded since roughly 2000.

Good response and kinda confirms my line of thinking. Don't agree and don't like it but I understand. At least it finally seems they have realized these are different times and they must prepare for success and possible failure if they truly want to compete.

 

[Empirical Cane]

Plus we’re the only university in America that has to rent a **** stadium.

You might want to rethink that.

 

[CashMoneyCane]

The death of UM football was when they joined the ACC, guaranteed revenue they didnt have to work for it no more. That was the nail

I think you're on to something, but this is not the whole story. The Coker hire was DISASTROUS. Following with Shannon was worse. Then Shapiro. Then Golden.

The move to the ACC was a big part of it but there were many factors.

Let's also not forget the Big East doesn't exist anymore, so it was probably the right move. We could not survive as an independent anymore.

 

[Empirical Cane]

Was not aware of this but not surprising considering Harvard's endowment has it's own management COMPANY and could probably fund the operations of the school as it stands today for decades.

My guess is this would only apply to the few truly huge endowments.

For more perspective...

"Harvard Management Company returned 10 percent on its investments during fiscal year 2018, bringing the total value of the University's endowment to $39.2 billion..."

If memory serves, they have the largest endowment of any University in THE WORLD.

I think I read Miami's endowment was $1.1 billion.

 

[Fluffhead]

Pretty sizable number that are susceptible ASSUMING they generate investment income not spent on the institution, which will be very few and far between (except any Trump U).

Disagree on that point. Almost every university (and many large not for profit as a whole) has alternative investments for endowment funds. I honestly don’t know how they are going to define or enforce any of this. Honestly, from the stuff in tax reform affecting my employer, the IRS has no idea how they are going to enforce this either.

 

[Go Canes!!]

So if Manny would've stayed and we ponied up 1.5 mill could we also pay for an OC.
Yes or No.
In other words do we have the financing to pay the same amount that the teams in the playoffs pay for their staffs.

It's not just salaries. On top of those expenses, other programs are investing tens of millions of dollars in facilities and stadium upgrades.

It's a massive arms race out there everywhere.

https://www.businessinsider.com/top-football-program-unveils-new-facilities-2018-9

 

[423Hurricane]

Enlightening thread OP.

As far as "renting" the stadium is concerned, I can't speak to the agreement between the U and HRS.

My father was the Orange Bowl Stadium Manager from 1960 to 1979. The City of Miami owned the stadium and the U didn't rent or lease the stadium per se. The City received a portion of the gate and a percentage of the concessions after expenses. The specific percentages were never shared with me.

When the Dolphins came to town in 1966, the U benefitted somewhat in the sense that the expense of operating the stadium could now be spread between 2 entities.

HRS is obviously owned by the Dolphins, however I would say that a similar agreement would be in place for the U. If the university is renting or leasing the stadium, they're more than likely leaving money on the table - of course dependent upon attendance.

 

[SFbayCane]

@CashMoneyCane - Correct me if I'm wrong but didn't donna make it so that no one could donate directly to the football program? (aside from existing programs like Living Scholar, etc.).

 

[S.CarolinaCane]

This is not necessarily a terrible idea. No idea how NCAA legalities would impact it, but I could see a way that fans donate to a general fund that is ultimately used to solicit recruits.

Get the donations rolling and I'll manage it.

Keep the NCAA away by making sure the correct percentage of the funds donated, go to the correct percentage, of the correct things.

Its not illegal, and it's all in the fine print, but that's the very simple explanation withput details of how to keep the foundation rolling.

Still have to have someone heading up the 'fundraising'

 

[Go Canes!!]

Enlightening thread OP.

As far as "renting" the stadium is concerned, I can't speak to the agreement between the U and HRS.

My father was the Orange Bowl Stadium Manager from 1960 to 1979. The City of Miami owned the stadium and the U didn't rent or lease the stadium per se. The City received a portion of the gate and a percentage of the concessions after expenses. The specific percentages were never shared with me.

When the Dolphins came to town in 1966, the U benefitted somewhat in the sense that the expense of operating the stadium could now be spread between 2 entities.

HRS is obviously owned by the Dolphins, however I would say that a similar agreement would be in place for the U. If the university is renting or leasing the stadium, they're more than likely leaving money on the table - of course dependent upon attendance.

They definitely are sharing revenue, but by the same token they just received a $500 million dollar facilities upgrade for nothing.

Imo the stadium was more of an issue when we were paying to play in an outdated, cavernous dump.