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Mismanaged Money, Not Covid, Killed ‘Non-Revenue’ College Athletics

University of Minnesota officials called men’s gymnastics coach Mike Burns last week and gave him the news: The school was cutting his program. He knew. It’s been happening to college non-revenue sports all across the country, alleged victims of the schools’ lost revenues from Covid-19.

Since the Big Ten wasn’t going to play football this fall, Burns’ program — as well as men’s tennis and track and field — had to go. But then this week came the miracle! The Big Ten will play football after all! And you know what that means to Burns, and all of his athletes, as well as tennis and cross country? 

Nothing. 

Their programs were still dead. Forever. Just like the programs recently cut at Iowa. And if the Pac-12 decides to play football, Stanford’s 11 programs won’t come back, either.

“My job is to protect my athletes,’’ Burns told me the other day by phone. “I felt that I failed them.’’

No, Burns was mistreated, victimized by ineptness. I’m calling BS on schools that keep dropping non-revenue sports, saying it was an economic necessity from Covid-19.

I stole that line from myself. I wrote it here last week and I’ll do it again. The bubble is bursting on college sports’ bloated business model. School administrators are taking advantage of a pandemic as cover to hide from their mishandling of the billions of dollars generated by football and basketball the past two decades. 

It’s time to restructure college sports.

The current model is to take those revenues and use them to pay for all the other sports. But here’s the dirty little secret:

“If you’re accounting properly and counting all the costs,’’ said Andrew Zimbalist, a highly regarded sports economist at Smith College, “you’d probably get only about a quarter of football schools in FBS generating a surplus. They totally mismanage the money.’’

Athletic departments and universities are outspending themselves and hiding the losses in bookkeeping tricks. Then they take the hot air that is supposed to be surplus and pretend to fund the Olympic sports with it. So they lose more and more money with more and more hot air until — POP!

The bubble bursts. There needs to be a new model. I proposed one last week and Zimbalist now helped me to refine it. Last week, I got help from economist Andrew Schwarz. In other words, I’m doing the work school presidents should be doing rather than firing coaches and destroying athletes’ dreams.

I’m going to fix college sports. Not to set my sights too high.

“I have mixed feelings about it,’’ Zimbalist said, throwing a little cold water. “Before you throw in the towel on the collegiate model, you might try to reform it.’’

This is what I think: Take football and basketball out of athletic departments and make them their own pro sports department, College Sports, Inc. Let them live within their means, pay for their own stadiums and stadium debt service out of their revenues, not the college tuition revenue. Pay the players, who then must pay income tax. Don’t charge students an athletics fee. Don’t take subsidies or other tax money. Pay your own bills.

Meanwhile, the non-revenue sports can have their own model with much smaller scholarships, where athletes pay much of their own way and their tuition dollars pay for the program. It doesn’t do a university any good to fill a tennis team with kids from Spain, let’s say, who don’t pay a penny to the school and then go home when they graduate.

“It’s a reasonable idea,’’ Zimbalist said. “And your College Sports Inc. doesn’t have to be owned by the university. It can be owned privately. Or, maybe the university can own 40 percent and (sell) stock for 60 percent.’’

Stock. Great idea. Let people buy it in College Sports Inc. Then, as Zimbalist points out, stockholders will pressure management to make profits. Boosters only pressure schools to win, so they overspend. Even before Covid, these departments had massive debts.

Zimbalist said that with athletic departments propped up by “subsidies and Uncle Sam’’ as well as stadium debt service being on the backs of universities and not on football revenues, the surpluses are fake and the coaches are paid millions of dollars based on surpluses that don’t really exist.

“This is an artificial market,’’ he said. “The coaches are being paid the value of the players they recruit.’’

Meanwhile, non-revenue sports are left to beg for scraps that don’t exist. I’m the tennis coach at Roosevelt University in Chicago, a small college. My players get academic scholarships and only small tennis scholarships. I don’t have access to the books, but I believe the team brings more money into the school than goes out.

It would take big concessions for major programs to do it that way. 

“Everything is evolving and it’s not going to go back,’’ Burns said. “If you’re clinging to the stuff you like, you’re not evolving.’’

Minnesota was projecting a $75 million loss, though and Burns said his team budget was $725,000, including everything. That shows you the BS: Minnesota would have to cut more than 100 gymnastics programs to cover that loss. No, it needs serious restructuring.

So non-revenue sports are fading away. There are just 12 men’s gymnastics programs left.

Burns said all the men’s gymnastics coaches had a Zoom meeting a few weeks ago to see if they could agree on cost cuts.

“We couldn’t agree on one thing,’’ he said. “At the end of the day, all we really need is a coach, a gym and people who want to train. People don’t want to give up what they’ve gotten used to. 

“But it’s like we’re on an airplane and it’s going down. And we’re hanging on to our backpack with our computer because it’s been so critical to our lives. At some point, you have to say `The plane’s going down, F— the computer. I’m grabbing a parachute instead.’ ‘’

Written by Greg Couch

Greg earned the 2007 Peter Lisagor Award as the best sports columnist in the Chicagoland area for his work with the Chicago Sun-Times, where he started as a college football writer in 1997 before becoming a general columnist in 2003. He also won a Lisagor in 2016 for his commentary in RollingStone.com and The Guardian.

Couch penned articles and columns for CNN.com/Bleacher Report, AOL Fanhouse, and The Sporting News and contributed as a writer and on-air analyst for FoxSports.com and Fox Sports 1 TV. In his journalistic roles, Couch has covered the grandest stages of tennis from Wimbledon to the Olympics, among numerous national and international sporting spectacles. He also won first place awards from the U.S. Tennis Writers Association for his event coverage and column writing on the sport in 2010.

6 Comments

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  1. GREAT ANALYSIS, Greg…and I said that last week, too…lol.
    Seriously good dive into the middle of the pool. Not sure you’d ever get out if you went into the deep end…pretty sure there’d be some strong hands holding you under ’til you tapped out of this line of inquiry. Stay with it, please…and thanks again for your great analysis!!!

  2. Well written Greg. Back when all the Athletic Departments started to cry poverty I wrote to some friends questioning what the Business Departments were teaching at these Colleges.

    Some of these Schools consider their MBA programs to be elite and yet they never looked at their own Athletic Departments. Stanford, Duke, Harvard, Michigan et al missed the train when it was still sitting at the Station. Just maybe all the Athletic Directors should be told to attend their Schools MBA programs and learn how to run a business.

  3. Great article and comments.

    Maybe it was Greg who said it previously but, what about non-revenue sports following an inter-mural/club model that subsidizing themselves via charity events, donations, and good ol’ mom & dad. The school supplies the facilities and uniforms. That’s it.

    Following on the great point above, wake these business professors out of their academic coma and have them put their lectures into action as case studies for athletic departments exposing waste, negligence, fraud, etc.

  4. I think this model will have lots of unintended consequences that will make it just as problematic as the existing model. One of them is the non-revenue sports will disappear in a couple years and if they are actually played, only rich kids will participate. We want the best competition in sports, not aristocrats playing lawn cricket. This goes against the idea of sports in America.

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