UConn athletics having success on the field, but are financials sustainable?
UConn #UConn
With its men’s and women’s basketball and ice hockey teams all in the national rankings, its football team rising from a dismal decade to play in a bowl game, perennial success in field hockey and the baseball team slugging to within one game of the College World Series, there is no doubt UConn had a successful 2022 on the athletic fields.
But with Tuesday’s release of the department’s budget, with a $53-million operating deficit, questions are again raised about the sustainability of high-level athletics in Storrs. Though the loss of its arbitration case with former men’s basketball coach Kevin Ollie tacked on a one-time cost of $13.4 million, the costs of competing nationally in various sports — without the revenue that comes with belonging to one of the national “power five” conferences — continues to outstrip UConn’s revenue.
The deficit was covered by a $46.5 million subsidy from the university and $6.5 million in student fees,
“If you remove the [Ollie] settlement piece, which was not a part of our budget planning, we saw the biggest one-year reduction in the overall support to the annual operating costs of athletics that we have seen in some time,” said David Benedict, UConn’s athletic director since 2016. “So we had a very good year as it relates to that. … Some schools are receiving a similar size check in media rights that we are getting from our university. We don’t happen to be in one of those conferences and are not getting those revenues. If you look at the other revenues we generate in corporate sponsorship and ticket sales, we are very much on line with the lower half of the power five. The area in which we are not is media rights. UConn, since I have been here, has made the decision to backfill that so we can remain competitive on a national level. Without that, we wouldn’t be.”
In 2020, Benedict was given the task of reducing the subsidy to athletics by 25%, or $10 million, by 2023. That June, a plan was announced to cut four sports, men’s cross country, women’s rowing, men’s swimming and diving and men’s tennis. Plans to eliminate men’s golf were canceled when alumni contributed enough money to save the program. The women’s rowing program was reinstated after settlement of a suit alleging title nine violations in cutting it.
UConn athletics reported a $43.5-million deficit in 2020, and $47.2 million in 2021. Minus the money paid to Ollie, who won the $11.3 million coming to him via his contract when the university fired him, contending “just cause” in 2018, and $3 million to settle other lawsuits related to the matter, the deficit for 2022 would be roughly $40 million, a decrease of $7 million year to year.
This, however, is still a high number, noted Andrew Zimbalist, longtime professor of economics at Smith College, who has written 24 books, most dealing with the economics of sports.
“This is one of the largest operating deficits in Division I college sports,” Zimbalist said. “The vast majority of Division I programs run deficits. The last year for which we have reasonably representative data is 2019, before the pandemic. The average Division I program with FBS [football] school in 2019 had an $18.8 million deficit. Connecticut is in worst shape than other schools because it doesn’t have a strong football program and football is the largest generator of revenue in college sports by a large margin.”
UConn’s football program, with new coach Jim Mora, was more successful in 2022 than it had been, but as an independent FBS program, it does not bring in the vast sums of TV money that FBS schools playing in the Big Ten, SEC, ACC, Pac-12 or Big 12 bring in, or national power Notre Dame as an independent. There is no power five opportunity for UConn on the horizon.
“Connecticut is in a structurally disadvantaged position and the bad news is, it’s very hard to see a path out of that situation,” Zimbalist said. “The only thing that would begin to help is if it got into a power five conference and it’s highly unlikely. It’s not a sustainable path, it’s not going to become a sustainable path, and what is going to happen is you are going to get pressure on increasing tuition and increasing student athletic fees, and more effort to squeeze more money out of the state legislature, but that’s going to be a difficult sell.”
Radenka Maric, who became UConn’s president last September, said she plans to study the university’s athletic costs going forward, but believes in its value.
“When I was faculty, I didn’t clearly see the value of athletics, I thought that this was a huge expense for the university,” Maric said. “But I have a completely different perspective now that I am president, because I see that this is an opportunity for alumni and donor engagement. It’s a huge connector for many people. I also see the economic impact it has on the state and the national exposure. I see tremendous value. … I see how, for students who play sports, it builds resilience and builds the character. That’s something I didn’t see when I was a professor.”
According to UConn, philanthropic donations reached $23.6 million, the third-highest total in UConn athletics history and a 12% increase from 2021. Ticket prices for athletic events rose considerably in 2022, though attendance, especially in the first part of the year, was still affected by the lingering concerns over COVID.
Much of the money spent by athletics is in the form of scholarships, tuition paid back to the university. Some is paid back to the state in the form of rent for playing at the XL Center and Rentschler Field, and other services.
“We get money from the university and then we pay it back to them,” Benedict said, “and that also happens with our relationship with the XL Center. The state gives money to the university, the university allocates it to athletics and then we give it back to the state and that shows up as an increase in our subsidy. I’m of the opinion the state should just keep their money and we’ll play there, or we can make decision to play on campus and reduce the overall expenses and then recover revenues that we don’t get either. It would obviously make that picture look differently.
“We have to continue to do the best we can and manage and reduce the subsidy and reliance on the university, and part of it is taking a hard look at some of the things we do. Part of it is spending money to play [in Hartford], which is not a requirement because we have facilities on campus. But it’s a relationship that is important and has been for a long time. There is certainly a reason we play downtown.”
Maric noted that recent UConn games in Hartford brought significant economic impact for the small businesses near the XL Center. “It’s not only for UConn, but for the small business when we play in the Hartford community,” she said. “I hear from the restaurants and business how huge an impact it has on them.”
Zimbalist said the argument does not take into account that money paid back to the university or state is for goods and services probably offered at a rate below what they are worth.
“That rent is probably a below-market rent and the state is giving them the football stadium,” he said. “They’re paying for it because they are getting a service and they are probably underpaying for the likely market value of what they are getting.”
Success in athletics comes with several proliferating price tags. Coaches’ salaries rise as they win and get opportunities to go elsewhere, and there is always demand for added staff, services and amenities for recruiting, in order to keep pace with what Power Five schools are doing. Cost-cutting measures fly in the face of this. For instance, UConn created 11 new full-time positions to support football, but Mora said much more will be needed to keep improving the program.
UConn has, in recent years, raised the money and built new facilities for baseball, softball, women’s lacrosse and soccer. The $70 million Toscano Family Ice Forum opened for men’s and women’s hockey last weekend.
“The NCAA has announced lots of changes in opportunities to add coaches in almost every sport,” Benedict said. “There is an expansion of opportunities to support your athletics programs. Whether or not we’re going to choose to do that at UConn remains to be seen, but those are all things that would increase the budget. Where do those dollars come from? The challenge is, there are increases I don’t control for salaries, for tuition and fees.”
Former UConn president Susan Herbst often called athletics “the front porch” of a university, meaning that success in athletics creates many benefits, tangible and intangible. One often argued is that success in sports means more applications, enrollment and a high-caliber student body.
“There has been a lot of empirical work on it and there is no just no evidence that says the quality of the student body goes up if you have a good athletic program,” Zimbalist said. “It is often argued that it encourages state legislatures to give more money. There is some evidence that happens to a small degree, but it’s not something to be relied upon.
… If your goal is to simply accept this as part of the university and part of the culture, then what you have to do is find policies to reduce your costs, don’t sign contracts with coaches that give them $5, $10, $15 million in severance pay. They either have to decide, we really don’t need to play at the top level in Division I and cut back, go to Division II or Division III, or if you absolutely need [high level sports] as a part of your identity, then find a way to economize on your costs.”
So UConn’s path forward leads mainly to a decision, perhaps a decision to be perennially revisited, on the cost of doing business, at least this kind of business, a choice to believe in the value of athletics and keep investing, or not.
‘I’m fairly certain there is no other Division I program that competes at a national level in as many sports as we do,” Benedict said, “and when you’re trying to compete at a national level, that requires resources, and when you have success at a national level, that requires even more.”
Dom Amore can be reached at damore@courant.com
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