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Friday, April 28, 2017

Athletics: Follow the Money

Two weeks ago, I blogged about "Papa" John Schnatter's widely publicized comment that "Until you fix athletics, you cannot fix this university." As I wrote, local journalists and University of Louisville leaders reacted to that remark as if they did not see any problems with Athletics -- and could not conceive of them.

For example, in today's Louisville Courier-Journal, Athletics Board member Bill Stone was quoted offering "praise and support for [Athletics Director Tom] Jurich's leadership and said that other areas of the university are what needs fixing."
'Oh my god, our athletic department is the envy of the country," Stone said. "... We need to put our effort into University Hospital and bring that health care facility back to where it was, where it was the place of choice. That's where we need to spend our attention, not on what works.'
Local radio personality Terry Meiners was also puzzled: “'His comments at the board meeting made zero sense to me,' Meiners said. 'And I mean zero-point-zero.... Everybody’s a little baffled with this one.... I grew up here,' Meiners said. 'I’ve seen the difference in the growth of the school starting Day 1 with Jurich. It’s as if he’s built an entire civilization that we were thirsting for in our community.'”

Despite the apparent bewilderment of local elites, my post referenced some potential areas of concern and linked to several of my previous posts on the topic. Additionally, in the interim between the first story and today's, reporter Tim Sullivan did some research:
Stephen Clark, a tenured professor who has spent 18 years at U of L, perceives Jurich not as “invisible” but “untouchable.” 
Athletics is truly untouchable at this university,” Clark said via e-mail. “It has a different set of rules than all the schools within the university. That goes for things such as ‘conflicts of interest’ particularly. 
“... While athletics means so much to a university, the athletic director and coaches should be under the control of the administration of the university and should operate under parallel guidelines. I don't think that's true at U of L.” 
Student Body President Aaron Vance, whose office entitles him to a seat on the Board of Trustees, seconded Schnatter’s vague statements in a post-meeting tweet: “Papa gets it,” Vance wrote. “Something we have all been thinking here for years.”  
...The U of L Athletics Association operates independently of the university’s general fund and boasts at least 15 straight years of balanced budgets, but its spending patterns could be seen as extravagant in those departments with tightening belts and by those students dealing with rising debt.  Monday, Vance's Twitter feed included a copy of a 2011-12 student government resolution urging U of L to abolish its $50-per-semester student athletics fee.
This week, Athletics is firing back. Yesterday, as the C-J reported, Associate athletics director Kevin Miller "presented an information sheet detailing the amount of money the athletics department provides to the university and vice versa." First, Athletics did recognize that some of their costs are borne by the rest of the University:
According to the document, the athletic department receives a total of $7.344 million in benefits from the university and U of L student fees. Those benefits are $3.263 million in expenses, mostly related to the costs of utilities at the sports facilities; $1.323 million in gender-equity funding; $829,900 in assistance to boost student-athlete academics; and $1.928 million in student fees ($50 per student per semester). 
What about the other side of the relationship?
In turn, athletics reportedly accounts for $30.6 million in tuition, room, board and books for the university due to the presence of student-athletes, managers, spirit groups and the pep band at the school, according to the information sheet.   
The athletic department also provided $4 million to the U of L general fund ($2 million in 2013-14 and $2 million in 2016-17), according to the document.
I have previously mentioned the relatively paltry sums (a few million dollars) that Athletics has provided during particularly difficult years for the University. In reality, those mostly offset the student fees they collect.

The $30.6 million is a more interesting question. Does Athletics subsidize education for all of those students, or does this figure include funds paid by students enrolled in the University? I suspect the latter since the 2014 and 2015 Athletics audit posted online revealed only about $13 million in total athletic scholarships.

So what is missing from the figures Athletics provided yesterday?

First, if the discussion is going to consider revenues collected by one institution thanks to the spending of the other institution's students, then UofL should receive credit for ticket sales to students (and alumni). I haven't seen a breakdown focusing only on students and alums, but UofL athletics collected about $27 million in ticket sales in 2015. For 2016, media reports placed those revenues at just under $30 million.

Not all students or alumni attend games, of course, but many watch those events on television or listen on radio. UofL Athletics has been collecting significant sums from direct TV deals and shared payments from the Atlantic Coast Conference: about $13 million in media rights fees and $7 million from the ACC. That's $20 million more thanks to students, alumni and other fans of the University's teams.

UofL Athletics also collects about $29 million in contributions from donors. As I've blogged previously, some academic research suggests that those donors might otherwise give to the University if Athletics was not asking them for cash.

Finally, there is the matter of the University of Louisville name. When individual UofL athletes depart the campus, a few become stars in the NBA or NFL and help their franchises collect big profits. Presumably, the players are rewarded with lucrative salaries.

However, the largest portion of former UofL basketball players (which is UofL's most lucrative sport) toil in relative anonymity in development leagues or foreign leagues. The players are presumably more skilled and experienced once they leave campus, but they no longer generate nearly the same revenues for their new programs. UofL fans cheer these players, and pay for tickets, sweatshirts, and TV ads, precisely because they wear the cardinal red of the local sports team and perform their feats on local courts and fields.

Does UofL Athletics pay the University for this association? No. Instead, Athletics collected $23 million in licensing and royalties in 2013.

Literally, Athletics rakes in tens of millions of dollars annually thanks to its affiliation with the University.


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Thursday, April 20, 2017

Notice something odd in the recent news?

Yesterday, former New England Patriot football player Aaron Hernandez apparently committed suicide in prison. His family and their lawyer have already called for an investigation because they do not believe Hernandez would have killed himself. After all, a few days ago, he was acquitted of some serious charges. And they presumably knew him best. On the other hand, Hernandez was serving life in prison without parole and his ex-teammates visited the Trump White House yesterday.

This news seemed especially unusual to me because a number of other prominent -- even notorious -- convicted killers and sex offenders have been found dead in prison in recent days and weeks. Locally, an 86-year old ex-priest convicted of sexually abusing 29 children died in prison in early March. 

That death seemed like natural causes given the age, but a series of recently reported prison deaths seems weird...perhaps statistically improbable:

Remember the Washington (state) mall shooter? He died earlier this week. April 17, BBC:
A man accused of killing five people at a shopping mall in Washington state has been found hanging inside his prison cell, say officials. 
Arcan Cetin, 20, who had been awaiting trial for the mass shooting in 2016, was found dead in the Snohomish County Jail on Sunday night.
Remember that Utah doctor who killed his wife, the former beauty queen? Washington Post, April 10:
61-year-old MacNeill was found unresponsive and declared dead at the Olympus Facility at the Utah State Prison in Draper, where he was doing time for his 2014 conviction of first-degree murder, second-degree obstruction of justice and second-degree forcible sex abuse. 
Prison officials said in a statement that MacNeill’s death is being investigated, though there were “no obvious signs of foul play.” 
This next case did not involve prominent killers or offenders, but it did involve multiple deaths. Thus, it made the national news less than two weeks ago. CNN, April 7:
Four inmates were found dead at a South Carolina prison, a spokesperson for the Department of Corrections said. 
Guards found the four men at 10:35 a.m. in a dorm at Kirkland Correctional Institution, a state maximum security site outside Columbia that holds approximately 15,000 offenders, said Sommer Sharpe.... 
The deaths "don't appear to be natural," Richland County Coroner Gary Watts told CNN affiliate WIS.
Three weeks ago, the locally-notorious "Angel of Death" serial killer (March 30):
A former nurse's aide dubbed the "Angel of Death" after he admitted killing three dozen hospital patients in Ohio and Kentucky died Thursday, two days after he was attacked and beaten in his prison cell. 
Donald Harvey, who was serving multiple life sentences, was found injured in his cell Tuesday afternoon at the state prison in Toledo, officials said. A patrol report said the 64-year-old was beaten when an unnamed person entered his cell.
Trying to recall the details of these recent incidents, I searched on Google and found a surprisingly long list of prison deaths. I'm not going to link to more of them.

Many of these deaths are first reported as suicide and some happened to older men, who seemingly died of natural causes. However, at least a few of the deaths seem suspicious, involving murder or under-explained violence in prison. Examining this string of deaths seems like (a) a potentially interesting question for a social scientist or student; (b) an important question for public policy makers responsible for securing prisons; and/or (c) the makings of a conspiracy-laden movie.

I should note that some investigative reporters have been down this road.

For anyone interested, here are other prominent examples I found in a quick search:

In 2015, an infamous California prisoner was killed after being moved into the general prison population.

Also in 2015: an Olympics gymnastics coach accused of child porn and molestation was found dead in prison.

In 2013, the Cleveland man who infamously held multiple women hostage for years in his home was found dead in prison.


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Friday, April 14, 2017

Fix UofL Athletics?

At a University of Louisville Board of Trustees meeting earlier this week, Board member John Schnatter -- of Papa John's Pizza fame -- said the following in an open session (link includes live video from the open part of the Board meeting):
“The athletics thing scares me … Until you fix athletics, you cannot fix this university,” Schnatter said.... 
[Interim University President] Postel, in an unrelated presentation during the meeting, said the university has an urgent need for operating cash in case of an emergency. 
Schnatter interjected, linking the university’s cash needs to the ongoing expansion of Papa John’s Cardinal Stadium, where the Cards play football. 
“We’re doing this by the skin of our teeth. We’re going to put $60 million in a stadium – by the way, it’s my stadium,” Schnatter said, laughing. “And we’re $5 million over budget and we’ve got 10 days cash on hand.** That’s crazy.”
Much of the reporting about Schnatter's remarks made it seem as if no one understands what he was talking about: "Pressed for plausible explanations of Schnatter’s statements, insiders have spent a lot of time scratching their heads and studying possible scenarios."

In his column in today's sports page, Tim Sullivan speculated about several angles that parallel my own thinking and writing about this topic:
This much, though, is plain: with revenues rising at the top tier of college athletics (by $304 million for the 50 power conference schools in 2015), the quasi-amateur sports arms race strikes more and more observers as obscene. Dollars devoted to attracting recruits and rewarding coaches with ever-glitzier facilities and ever-sweeter pay packages are inconsistent with the experiences of other students and staff and only available because of an athletic program’s affiliation with a specific school
Too often, though, administrators at those schools have little say over whether those dollars might serve some higher purpose somewhere else on campus. Those athletic departments that retain nearly all of the money they generate, often while appropriating student fees and off-loading certain expenses on the university’s general fund, essentially operate in a parallel universe that can be a burden on the rest of the university
If that’s what Papa John is talking about, that’s a subject worth discussing, and one that applies to many major schools. 
University of Louisville, confronting a $48 million budget cut, needs to have this conversation immediately.


** Officials said at the meeting that the University actually now has 35 days of cash on hand -- thanks apparently to a recent hiring freeze accompanied by increased scrutiny on unit spending. Here's a November 2016 press release from Moody's explaining about why this number is important.

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