Big Ten full share will NOT fix revenue problem

[eceres]

Our football revenue is less than the spending by the top programs (Michigan State spends more, Wisconsin spends 100k less than we make).

PennLive did a look at football revenue per school (ignoring big ten pay out).

Revenue (Profit)
Purdue 17.1 (1.5)
Rutgers 26.9 (6.8)
Indiana 27.5 (9.5)
Illinois 30.8 (12.5)
Maryland 30.9 (14.8)
Northwestern 31.7 (10.8)
Minnesota 35.8 (9.5)
Wisconsin 44.8 (18)
Iowa 52.4 (26.9)
Michigan State 59.2 (21.5)
Nebraska 60.6 (31.4)
Penn State 71.3 (36.2)
Ohio State 83.5 (51)
Michigan 88.3 (56.6)


Spending
Purdue 15.6
Maryland 16.1
Indiana 18
Illinois 18.3
Rutgers 20.1
Northwestern 20.9
Iowa 25.5
Minnesota 26.3
Wisconsin 26.8
Nebraska 29.2
Michigan 31.7
Ohio State 32.5
Penn State 35.1
Michigan State 37.7

 

[cubuffsdoug]

Our football revenue is less than the spending by the top programs (including the ones we aspire to be like Mich State and Wisconsin).

PennLive did a look at football revenue per school (ignoring big ten pay out).

Revenue (Profit)
Purdue 17.1 (1.5)
Rutgers 26.9 (6.8)
Indiana 27.5 (9.5)
Illinois 30.8 (12.5)
Maryland 30.9 (14.8)
Northwestern 31.7 (10.8)
Minnesota 35.8 (9.5)
Wisconsin 44.8 (18)
Iowa 52.4 (26.9)
Michigan State 59.2 (21.5)
Nebraska 60.6 (31.4)
Penn State 71.3 (36.2)
Ohio State 83.5 (51)
Michigan 88.3 (56.6)


Spending
Purdue 15.6
Maryland 16.1
Indiana 18
Illinois 18.3
Rutgers 20.1
Northwestern 20.9
Iowa 25.5
Minnesota 26.3
Wisconsin 26.8
Nebraska 29.2
Michigan 31.7
Ohio State 32.5
Penn State 35.1
Michigan State 37.7

Have you looked at how Rutgers cut cost in the last 2 years while earning money from the BE and AAC? At one point Rutgers was the worst defenders in taking money from student fees and general school funds. Also, consider the way Rutgers does its books it's different from others. Rutgers is one of the few who puts the facilities under the athletic department while the school has use of it. Most schools have facilities under the school, therefore the cost and maintenance falls under the school. It's not as simple as you make it out to be.

 

[RUsojo]

Have you looked at how Rutgers cut cost in the last 2 years while earning money from the BE and AAC? At one point Rutgers was the worst defenders in taking money from student fees and general school funds. Also, consider the way Rutgers does its books it's different from others. Rutgers is one of the few who puts the facilities under the athletic department while the school has use of it. Most schools have facilities under the school, therefore the cost and maintenance falls under the school. It's not as simple as you make it out to be.

You know I've heard this over and over again and I've assumed it to be true for years and I still do. But I do not remember the school actually putting this out there. Has it ever been stated publicly?

 

[RUChoppin]

Not sure how you define the "revenue problem".

In the short term, the "revenue problem" is that our costs exceed our overall revenues, which requires the athletic department to take a subsidy from the university. THAT will go away with the Big Ten full share, if not sooner.

Last year's subsidy was $23.8M (down from $47M in 2013). We renegotiate our uniforms deal next season, which will very likely yield a large revenue increase (from the $130K/yr we're making now). Our donations have been increasing year over year, which should continue. The Big Ten contract renegotiation next year, coupled with a full share in 2020 will also increase the revenue substantially (very likely by >$30M/year). And the stadium naming rights deal will be renegotiated in 2021.

Taken altogether, that should be well more than enough to kill the subsidy - even with increased spending.

***

Now, if you're talking about the longer term, meaning our comparison against our conference peers, that's further down the line. Let's get the subsidy squared away before we start talking about competing with Ohio State and Michigan in terms of revenue.

 

[eceres]

Have you looked at how Rutgers cut cost in the last 2 years while earning money from the BE and AAC? At one point Rutgers was the worst defenders in taking money from student fees and general school funds. Also, consider the way Rutgers does its books it's different from others. Rutgers is one of the few who puts the facilities under the athletic department while the school has use of it. Most schools have facilities under the school, therefore the cost and maintenance falls under the school. It's not as simple as you make it out to be.

This is not applicable to football only revenue, the facility of HPSS stadium from my understanding is under general athletics and so is not factored here. Also, you are defending costs - our spending on football is not the problem. This shows we actually need to spend more on football to be successful.

The problem here is that our revenue is low compared on equal footing to our peers. Indiana makes more on football than we do (IGNORING THE BIG TEN MONEY). We need to increase our revenue by 5-10M to be in the middle of the pack (near Northwestern and Minnesota).

 

[RUTGERZ_R00LZ]

Slight correction: Wisconsin spending is not more than Rutgers' revenue (by 100K).

 

[eceres]

Not sure how you define the "revenue problem".

In the short term, the "revenue problem" is that our costs exceed our overall revenues, which requires the athletic department to take a subsidy from the university. THAT will go away with the Big Ten full share, if not sooner.

Last year's subsidy was $23.8M (down from $47M in 2013). We renegotiate our uniforms deal next season, which will very likely yield a large revenue increase (from the $130K/yr we're making now). Our donations have been increasing year over year, which should continue. The Big Ten contract renegotiation next year, coupled with a full share in 2020 will also increase the revenue substantially (very likely by >$30M/year). And the stadium naming rights deal will be renegotiated in 2021.

Taken altogether, that should be well more than enough to kill the subsidy - even with increased spending.

***

Now, if you're talking about the longer term, meaning our comparison against our conference peers, that's further down the line. Let's get the subsidy squared away before we start talking about competing with Ohio State and Michigan in terms of revenue.

I'm talking about the longer term. We don't need revenue of Ohio State / Michigan / Penn State.

But being at the bottom way behind schools we don't consider above us currently is a problem. We are 5-10M behind the middle of the pack in the revenue column.

Looking at the spending we are 6M behind Wisconsin / Minnesota. Not sure why Michigan State's spending is so high (either bad numbers from the penn live article, or they have accounting that puts much more expenses on the football team than the rest of the schools do). Those are the peers we strive to be in line with.

So we really need to find non-Big Ten payday money in the 5-10M range to invest in our football team.

 

[cubuffsdoug]

You know I've heard this over and over again and I've assumed it to be true for years and I still do. But I do not remember the school actually putting this out there. Has it ever been stated publicly?

The year Rutgers made the one time payment to leave the AAC it was release publicly. The star ledger had it covered.

 

[eceres]

Slight correction: Wisconsin spending is not more than Rutgers' revenue (by 100K).

Fixed the italics.

 

[PaKnight]

While not doubting the accuracy of he numbers, I do doubt that Michigan State outspends Michigan, OSU and PSU consistently.

 

[RUChoppin]

I'm talking about the longer term. We don't need revenue of Ohio State / Michigan / Penn State.

But being at the bottom way behind schools we don't consider above us currently is a problem. We are 5-10M behind the middle of the pack in the revenue column.

Looking at the spending we are 6M behind Wisconsin / Minnesota. Not sure why Michigan State's spending is so high (either bad numbers from the penn live article, or they have accounting that puts much more expenses on the football team than the rest of the schools do). Those are the peers we strive to be in line with.

So we really need to find non-Big Ten payday money in the 5-10M range to invest in our football team.

Have to fix the short term before we worry about the long term. Here are the subsidies per school (minus Northwestern, which did not report numbers) for the conference, per USA Today
$23.8M - Rutgers
$14.5M - Maryland
$7.9M - Wisconsin
$6.9M - Minnesota
$3.7M - Illinois
$2.7M - Indiana
$0.7M - MSU
$0.7M - Iowa
$0.3M - Michigan
$0 - Purdue, Nebraska, PA St, Ohio St

We need to climb out of our hole before we start worrying about comparing revenues with other teams.

 

[mdk01]

If you define "fix" as totally solve then you're right. However, the B1G money will doubtless reduce the subsidy. So will other measures suggested above (i.e. uniforms).

And why is it all on football to end the subsidy? I'd have loved to see a similar comparison made with Men's BB and Women's BB. I realize the facility's an issue, but even factoring that in I think the result would not be pretty. Hell, Men's lacrosse may never break even but a few more years like 2016 and it may close the gap.

 

[PaKnight]

If you define "fix" as totally solve then you're right. However, the B1G money will doubtless reduce the subsidy. So will other measures suggested above (i.e. uniforms).

And why is it all on football to end the subsidy? I'd have loved to see a similar comparison made with Men's BB and Women's BB. I realize the facility's an issue, but even factoring that in I think the result would not be pretty. Hell, Men's lacrosse may never break even but a few more years like 2016 and it may close the gap.

Outside of football and men's basketball, I doubt any other sport turns a profit at any school, or rarely.

 

[RUChoppin]

If you define "fix" as totally solve then you're right. However, the B1G money will doubtless reduce the subsidy. So will other measures suggested above (i.e. uniforms).

And why is it all on football to end the subsidy? I'd have loved to see a similar comparison made with Men's BB and Women's BB. I realize the facility's an issue, but even factoring that in I think the result would not be pretty. Hell, Men's lacrosse may never break even but a few more years like 2016 and it may close the gap.

This particular list was about football revenue, but it's not about any one sport - it's about the athletic department as a whole. Media rights deals include all sports that receive broacasts, whether it's on television, radio, or internet. Uniform deals encompass all sports. Donations are to the athletic department, and are used where needed across all sports - unless specifically earmarked. Naming rights deals are available for more than just the football stadium, if we were to pursue it. Ticket revenues come from all sports that charge for tickets, and will increase as performance/interest increases.

Football and men's basketball just have the highest ceiling - but each sport contributes it's part toward increasing overall revenues.

 

[cubuffsdoug]

This is not applicable to football only revenue, the facility of HPSS stadium from my understanding is under general athletics and so is not factored here. Also, you are defending costs - our spending on football is not the problem. This shows we actually need to spend more on football to be successful.

The problem here is that our revenue is low compared on equal footing to our peers. Indiana makes more on football than we do (IGNORING THE BIG TEN MONEY). We need to increase our revenue by 5-10M to be in the middle of the pack (near Northwestern and Minnesota).

Hermann started to address some issues before being fired. For one, season ticket holders now donate money before you purchase tickets. Also, there are tickets that cost different amounts based on the opponent. Add increase donations overall as well as new revenue sources. It's not a quick fix. Football is starting to realize its potential and receI've the support it needs.

 

[ecojew]

One thing that has always confused me about our deficit and subsidy is whether or not the fee that the students pay for athletics - which I think also includes their access to recreational facilities on campus - is counted as part of that deficit. RU has long had a student athletic fee - we paid it as part of a larger "Student fee" back in the late 1960s when I was an undergrad. But RU has always provided free student tix as part of that arrangement, limited only by capacity. At most other schools, students must purchase their student tix, which I recall doing at Ohio State in the early 1970s.

So, if that is part of the "subsidy" figure that is being reported each year, I question whether or not that is truly a subsidy since the students do receive substantial benefit from paying that fee, should they choose to take advantage of it. If that is part of the "subsidy" then removing it would certainly lower the figure rather substantially.

Anybody know how the student athletic fee is accounted for?

Thanks.

 

[DJ Spanky]

 

[ArminRU]

Those numbers are not the full Big Ten share.

 

[pmvon]

One thing that has always confused me about our deficit and subsidy is whether or not the fee that the students pay for athletics - which I think also includes their access to recreational facilities on campus - is counted as part of that deficit. RU has long had a student athletic fee - we paid it as part of a larger "Student fee" back in the late 1960s when I was an undergrad. But RU has always provided free student tix as part of that arrangement, limited only by capacity. At most other schools, students must purchase their student tix, which I recall doing at Ohio State in the early 1970s.

So, if that is part of the "subsidy" figure that is being reported each year, I question whether or not that is truly a subsidy since the students do receive substantial benefit from paying that fee, should they choose to take advantage of it. If that is part of the "subsidy" then removing it would certainly lower the figure rather substantially.

Anybody know how the student athletic fee is accounted for?

Thanks.

This is I think part of the problem. Part of the deficit calculation is different versus peers. I think even barchi doesn't expect the student fees to go away only the direct institutional support.

 

[32Mine]

When do we get out from the deal with the naming rights for High Point Whatever Stadium?

 

[badger74]

Have to fix the short term before we worry about the long term. Here are the subsidies per school (minus Northwestern, which did not report numbers) for the conference, per USA Today
$23.8M - Rutgers
$14.5M - Maryland
$7.9M - Wisconsin
$6.9M - Minnesota
$3.7M - Illinois
$2.7M - Indiana
$0.7M - MSU
$0.7M - Iowa
$0.3M - Michigan
$0 - Purdue, Nebraska, PA St, Ohio St

We need to climb out of our hole before we start worrying about comparing revenues with other teams.

The entire UW "subsidy" is just an accounting adjustment. Out of state tuition is "waived" to instate levels for scholarship athletes. I'm not sure any school charges the AD out of state tuition for the athletes.

 

[RURM85]

Rutgers has lived in the rich neighborhood for only a full year after moving away from the crack house. Taking a look at the break-out of the Rutgers football program revenue per the NJSL, the numbers are indicative of an old Big East and/or G5 program. $2.9M revenue allocated to Rutgers Football from the approx. $10M payout from the B1G Conference. That will grow as the school becomes a full member. $4.4M of outside revenue (donations directly for the football program). Michigan probably gets $4.4M football donations in a day. Willing to guess that Rutgers ticket prices are on the low side for the Conference. If the team starts to win, I'm sure ticket prices will inch up. Even the annual IMG contract revenue is probably tiny compared to most B1G schools.

Come back in 10 years to compare after the school has an opportunity to dip its toes into the mansion's pool.

 

[RUChoppin]

When do we get out from the deal with the naming rights for High Point Whatever Stadium?

2021

 

[knightfan7]

Rutgers spending will increase the next time around when new coaches salaries, increased support staff, and larger recruiting budget are added in.

Schools like Nebraska and maybe Iowa are required to spend a lot more recruiting because there isn't enough talent locally. The top spenders pay their staffs millions more and recruit nationally much more than Rutgers has in the past.

 

[demauroj]

Here is where your statement falls short

The top 4 revenue producers double our capacity stadium wise, and have triple digit apparal deals.

We will likely never catch up to Michigan or OSU on the revenue side, but it is important that we do what we can with the money we earn.

We need to stop comparison g ourselves to the blue bloods and take babysteps.

 

[eceres]

Here is where your statement falls short

The top 4 revenue producers double our capacity stadium wise, and have triple digit apparal deals.

We will likely never catch up to Michigan or OSU on the revenue side, but it is important that we do what we can with the money we earn.

We need to stop comparison g ourselves to the blue bloods and take babysteps.

So who should we compare to? I think Wisconsin and Michigan State are who we aim to emulate, while Minnesota / Iowa would be nearer term comparable.

Also, as can be seen you don't need to match revenue, to be in ssameanger area spending wise.

We are only 10-15M off blue bloods in spending while revenue is off 45-70M.

I still hold we are 10M revenue And 5M spending below our peers. The big ten payout covers the subsidy issue. This difference is about competitive funding against similar schools.

 

[Arizona Knight]

So who should we compare to? I think Wisconsin and Michigan State are who we aim to emulate, while Minnesota / Iowa would be nearer term comparable.

Also, as can be seen you don't need to match revenue, to be in ssameanger area spending wise.

We are only 10-15M off blue bloods in spending while revenue is off 45-70M.

I still hold we are 10M revenue And 5M spending below our peers. The big ten payout covers the subsidy issue. This difference is about competitive funding against similar schools.

We're about five years away from a 40MM bump. The gap will close but not to zero.

 

[DJ Spanky]

We're about five years away from a 40MM bump. The gap will close but not to zero.

Actually we're far closer. As has been discussed in other threads, when the Big Ten new TV contracts kick in (I believe for the 2017 season?), we will get the FULL increase in the value of the share. Pulling numbers out of the air, say the current share is $20 million and the new share jumps to $50 million. We will get that full $30 million increase. Our share of the original $20 million will still be prorated to cover our entrance into the Big Ten, but any increase will not.

 

[Arizona Knight]

Actually we're far closer. As has been discussed in other threads, when the Big Ten new TV contracts kick in (I believe for the 2017 season?), we will get the FULL increase in the value of the share. Pulling numbers out of the air, say the current share is $20 million and the new share jumps to $50 million. We will get that full $30 million increase. Our share of the original $20 million will still be prorated to cover our entrance into the Big Ten, but any increase will not.

Do we have confirmation on that yet? I know that has been speculated but if there was anything stated publicly, I missed it. Would certainly be fantastic news.

 

[eceres]

We're about five years away from a 40MM bump. The gap will close but not to zero.

Again this is comparing finances without the big ten money, do or football program produces near Purdue level. saying big ten money fixes that is blind to reality.

 

[Leonard23]

So who should we compare to? I think Wisconsin and Michigan State are who we aim to emulate, while Minnesota / Iowa would be nearer term comparable.

Also, as can be seen you don't need to match revenue, to be in ssameanger area spending wise.

We are only 10-15M off blue bloods in spending while revenue is off 45-70M.

I still hold we are 10M revenue And 5M spending below our peers. The big ten payout covers the subsidy issue. This difference is about competitive funding against similar schools.

Wisconsin & MSU have 80k & 75k seat stadiums, respectively, whereas ours is 52,454. The football revenue "problem" is a winning & attendance problem. The largest sources of football only revenue are likely tix sales & donations so the schools with the highest attendance generate more $ in tix sales & all of the other game day revenue generating items, like parking, concessions, apparel & memorabilia. Those schools also win & get more in donations. As we win more, tix & parking prices will increase, more people will attend games & spend $ on those other items & donations will increase.

 

[Arizona Knight]

Again this is comparing finances without the big ten money, do or football program produces near Purdue level. saying big ten money fixes that is blind to reality.

Bill Gates and I live quite differently today. If you give us each a billion dollars this afternoon the wealth disparity won't change. However, that money would have a much greater impact on my lifestyle than it would his.

 

[koleszar]

Again this is comparing finances without the big ten money, do or football program produces near Purdue level. saying big ten money fixes that is blind to reality.

What the writer is leaving out is the money these schools have to spend from the B1G. Sure it's easy to say football only made X amount of money in a vacuum like he does. But he left out the B1G Network X that everyone receives that allows them to have the better coaches, nicer stadiums and facilities to attract upper echelon players. Which in turn causes increased winning, which then leads to larger crowds, better equipment deals, more merchandise sold and larger donations.

Ever hear the old adage it takes money to make money. Well we have no money. He just conveniently left out a huge chunk of money everyone gets to spend but us. Hell Maryland even got their piece last year. Reduce the subsidy? Don't forget 10 Million of that is student fees, that's not going away, unless students decide they want to pay for sporting events and use of athletic facilities. These ticket sales are not included in these figures the writer sites, where others charge students for tickets ours is include in our subsidy.[/QUOTE]

 

[cubuffsdoug]

Leonard23 has it right. What the writer is leaving out is the money these schools have to spend from the B1G. Sure it's easy to say football only made X amount of money in a vacuum like he does. But he left out the B1G Network X that everyone receives that allows them to have the better coaches, nicer stadiums and facilities to attract upper echelon players. Which in turns causes increased winning, which then leads to larger crowds, better equipment deals, more merchandise sold and larger donations.

Ever hear the old adage it takes money to make money. Well we have no money. He just conveniently left out a huge chunk of money everyone gets to spend but us. Hell Maryland even got there piece last year. Reduce the subsidy? Don't forget 10 Million of that is student fees that's not going away, unless students decide they want to pay for sporting events and use of athletic facilities. These ticket sales are not included in these figures the writer sites, where others charge students for tickets ours is include in our subsidy.

That's why you don't argue with an idiot because from a distance others can't tell who's the fool.[poop]

 

[DJ Spanky]

Do we have confirmation on that yet? I know that has been speculated but if there was anything stated publicly, I missed it. Would certainly be fantastic news.

I doubt anything will be said publicly about the amount until the contracts are signed and preliminary calculations are done. However, I don't recall the exact number, but the proration of our Big Ten share over 6 years (7th year we get a full share) is based on that number for the buy in. So that number will not change if the Big Ten share changes.

 

[DJ Spanky]

It appears the OP has a certain POV and will twist or ignore anything to prove it.

 

[eceres]

What the writer is leaving out is the money these schools have to spend from the B1G. Sure it's easy to say football only made X amount of money in a vacuum like he does. But he left out the B1G Network X that everyone receives that allows them to have the better coaches, nicer stadiums and facilities to attract upper echelon players. Which in turns causes increased winning, which then leads to larger crowds, better equipment deals, more merchandise sold and larger donations.

Ever hear the old adage it takes money to make money. Well we have no money. He just conveniently left out a huge chunk of money everyone gets to spend but us. Hell Maryland even got their piece last year. Reduce the subsidy? Don't forget 10 Million of that is student fees, that's not going away, unless students decide they want to pay for sporting events and use of athletic facilities. These ticket sales are not included in these figures the writer sites, where others charge students for tickets ours is include in our subsidy.

[/QUOTE]

The student tickets is a good point - that's a big part of the stadiumthat's not accounted for in football profits (shows up under subsidy). That would probably close the gap a couple million.

 

[eceres]

It appears the OP has a certain POV and will twist or ignore anything to prove it.

What have ignored besides people saying the big ten payment solves all? We all have POVs, that's the point of forum.

 

[Arizona Knight]

What have ignored besides people saying the big ten payment solves all? We all have POVs, that's the point of forum.

Not being a jerk, but what would you have us do. We will never outspend Michigan or Ohio State. Neither will anyone else in college football. The only solution to your "problem" would be to drop down to the ACC or something similar.

 

[eceres]

Not being a jerk, but what would you have us do. We will never outspend Michigan or Ohio State. Neither will anyone else in college football. The only solution to your "problem" would be to drop down to the ACC or something similar.

Not at all, if you read posts you would see I never compare to Michigan, Ohio State, Penn State or Nebraska.

I have offered who we should aspire to: Michigan State and Wisconsin. As well who we probably think we are closer to today Minnesota and Northwestern.

We need to get revenue and spending close to this comparables if we don't want to be the doormat team a lot of the big ten thinks of us as.

If you are all content with Purdue / Indiana revenue...expect similar results? We do out spend both of those programs which is a good sign.