Split thread -- UM and MSU Athletic Budgets

El_Gato · Post by **El_Gato** » Thu Sep 23, 2004 11:02 am

Are you all forgetting that when MSU plays a REAL division 1A school like WSU, CSU, OSU, or Colorado that they get paid a BIG chunk of money?

At least at MSU we are doing our best to get out of our deficit situation. I doubt that the Home/Away series with Idaho netted the Grizzlies any positive income whatsoever...

If you ever want to know more details about the Griz deficit, just let me know. A good friend of mine was the head of the investigating committee and I have lots of good stories to tell about how Hogan & company were "running" things at old UM... BTW, she is a Griz alum, so she is at the very least neutral, if not pro-Griz in her bias.

For instance, MSU's athletic department utilizes 4 credit cards for use by coaches/staff for various expenses; they are kept in a vault or signed for by whoever is carrying it at the time. The Grizzlies under Hogan had over 40 credit cards issued to the Athletic Department and after 1 week of trying to locate/account for them, they couldn't even come up with half of them!! A great program run by great people down there in Marijuanaville... I'm sure Don Read will do a better job, but Hogan was what he always appeared to be: a buffoon.

jagur1 · Post by **jagur1** » Thu Sep 23, 2004 11:09 am

The Home games at Wash-Griz vrs. Idaho netted more for the school than the little road trip to CSU will. 4 credit cards held under lock and key sounds rinky dink to me just like MSU. Cash flow baby, U of M has it and will be out of debt. MSU doesn't and will keep getting money from the U side to keep the lights on.

Post by **SonomaCat** » Thu Sep 23, 2004 11:15 am

jagur1 wrote:4 credit cards held under lock and key sounds rinky dink to me just like MSU.

That's a good line for smack purposes, but not so much in terms of good internal controls. It sounds like MSU is doing this one thing very right. Even large companies (with cash flow 10,000x the Griz piddly budget) have strict controls over their corporate credit cards and other spending controls.

I know this way too well... and it's not something that I'm proud of or necessarily happy to be a part of. It's a real pain.

CARDIAC_CATS · Post by **CARDIAC_CATS** » Thu Sep 23, 2004 11:26 am

Bay Area Cat wrote:
jagur1 wrote:4 credit cards held under lock and key sounds rinky dink to me just like MSU.
That's a good line for smack purposes, but not so much in terms of good internal controls. It sounds like MSU is doing this one thing very right. Even large companies (with cash flow 10,000x the Griz piddly budget) have strict controls over their corporate credit cards and other spending controls.

I know this way too well... and it's not something that I'm proud of or necessarily happy to be a part of. It's a real pain.

Yep, I know our company has them under lock and key pretty much and no 'joe blow' can just go an use them like under Hogan at UM.

Cat-theotherwhitemeat · Post by **Cat-theotherwhitemeat** » Thu Sep 23, 2004 11:27 am

El_Gato wrote:At least at MSU we are doing our best to get out of our deficit situation. I doubt that the Home/Away series with Idaho netted the Grizzlies any positive income whatsoever...

Do you really believe this? Are you that dim-witted to believe that a sold out stadium of 23,000+ doesn't bring a positive income? Do I have to do the math for you?

Do I even have to bring up the differences between economic benefits for the host city/school?

MSU leaves for a 1-A payday: $150,000 for the school. Certainly nothing wrong with this.
UM plays at home: Sold out stadium, thousands come to town and spend their money. School benefits, Missoula benefits, surrounding communities benefit....etc

Again, do you really believe that the Griz should schedule an away "Money" game when they make more by staying at home??

Post by **SonomaCat** » Thu Sep 23, 2004 11:32 am

Before we get too deep into the mucky muck of people coming up with too many interesting ecomonic theories and amounts to support assertions that X is better than Y, can we just agree that UM had some internal control issues that are now being cleared up, as did MSU, and that both schools (and most every school in the country) are having a hard time making enough money to cover the "expenses" of the athletic departments.

Of course, to throw in my own personal economic theory, the whole thing is B.S. Boosters raise money for scholarships, which pays for tuition to the U. This is recorded as an expense for the AD and revenue for the school (I assume). Now if the deficit run by the AD is less than the amount that the AD pays the U for tuition of the athletes, is that a real deficit, or is this just BS fund accounting issue? If the school gave tuition waivers to the student-athletes (as they do for many other types of scholarships), would these deficit issues suddenly vanish? If the athletic programs ceased to exist at both schools, would the net revenue of the school actually decrease? How does this jive with the assertion that the AD's are running deficits?

In reality, we should be looking at the AD and the U as the same thing, and ignoring the interdepartment charges. The AD is essentially a marketing arm of the University, yet I doubt that it charges the U any sort of marketing fee (explicitly, anyway). On the flipside, the U does charge the AD for the tuition of the student-athletes. In an economic sense, this isn't fair at all to the AD (but governmental accounting isn't based on economics in the same way that regular accounting [sort of] is).

The transfer pricing issues on this sort of thing would be intense! (with a shout out to any other tax people who actually understood that codehead humor).

theblackgecko · Post by **theblackgecko** » Thu Sep 23, 2004 1:38 pm

I agree with BAC that scholarships aren't really costs for a university. In the end, they work out to be tranfer payments from AD to university to scholarship, which the university gets back as tuition. It gets counted at athletic department deficit, when in actuality, it should be counted as a transfer payment between departments.
In the long term, there are issues of how the two Montana schools raise revenue. Montana State had always diverted a larger proportion of the state money into the athletic department than Montana. So, on paper it appears both schools raise comparable amounts of money when Montana actually generates more revenue from its athletic juggernaut. Consider this for a bit. Football is the largest revuene sport at both universities. And, if one looks in the revenue column for both schools. Montana runs 3.3 million in revenue versus Montana State at 2.9 million. I don't think anyone is going to question that Montana generates far more football revenue through ticket sales and other means than Montana State. Yet, the two schools claim to have comparable football revenue. It makes me wonder...
Statistics from [html]http://ope.ed.gov/athletics/Search.asp[/html]

CARDIAC_CATS · Post by **CARDIAC_CATS** » Thu Sep 23, 2004 1:56 pm

theblackgecko wrote:I agree with BAC that scholarships aren't really costs for a university. In the end, they work out to be tranfer payments from AD to university to scholarship, which the university gets back as tuition. It gets counted at athletic department deficit, when in actuality, it should be counted as a transfer payment between departments.
In the long term, there are issues of how the two Montana schools raise revenue. Montana State had always diverted a larger proportion of the state money into the athletic department than Montana. So, on paper it appears both schools raise comparable amounts of money when Montana actually generates more revenue from its athletic juggernaut. Consider this for a bit. Football is the largest revuene sport at both universities. And, if one looks in the revenue column for both schools. Montana runs 3.3 million in revenue versus Montana State at 2.9 million. I don't think anyone is going to question that Montana generates far more football revenue through ticket sales and other means than Montana State. Yet, the two schools claim to have comparable football revenue. It makes me wonder...
Statistics from [html]http://ope.ed.gov/athletics/Search.asp[/html]

They are not saying they have compareable revenue, they are saying they have compareable net profit

While UM makes more, they spend more too. So where does that get you? Oh, MSU also kills UM when it comes to research and development as well. Isn't it up to like 85 million now this year? WOW! Its doubled in less than 10 years. Way to go MSU.

Post by **SonomaCat** » Thu Sep 23, 2004 2:03 pm

theblackgecko wrote:I agree with BAC that scholarships aren't really costs for a university. In the end, they work out to be tranfer payments from AD to university to scholarship, which the university gets back as tuition. It gets counted at athletic department deficit, when in actuality, it should be counted as a transfer payment between departments.
In the long term, there are issues of how the two Montana schools raise revenue. Montana State had always diverted a larger proportion of the state money into the athletic department than Montana. So, on paper it appears both schools raise comparable amounts of money when Montana actually generates more revenue from its athletic juggernaut. Consider this for a bit. Football is the largest revuene sport at both universities. And, if one looks in the revenue column for both schools. Montana runs 3.3 million in revenue versus Montana State at 2.9 million. I don't think anyone is going to question that Montana generates far more football revenue through ticket sales and other means than Montana State. Yet, the two schools claim to have comparable football revenue. It makes me wonder...
Statistics from [html]http://ope.ed.gov/athletics/Search.asp[/html]

Those revenue numbers are interesting. I imagine that there is no consistent methodology for accounting for numbers like that (especially when splitting out revenue by sport), but it would be interesting to see a breakdown by school of the sources of income for each (ticket sales, student fees, luxury boxes, allocations of scholarship funds, etc.).

I really don't know enough about it to speak to it, except that I am ALWAYS skeptical anytime I hear a dollar figure quoted about college athletics (especially on fan bulletin boards). Too often, people are comparing apples and oranges, or simply have no idea at all what they are talking about. Give me a 50 page comprehensive set of financial statements, baby!

That being said, maybe I should do some research to see if that kind of stuff is actually available. It wouldn't hurt me to know what I'm talking about, either.

Post by **SonomaCat** » Thu Sep 23, 2004 2:07 pm

That was a really good link you posted, gecko. Thanks! It's a great source for the gross numbers (not a lot of the nitty gritty details we were talking about, though).

theblackgecko · Post by **theblackgecko** » Fri Sep 24, 2004 9:29 am

Let me know if you find anything that does break down the details. I too would be interested to know how the components of the athletic budgets for the schools break down.

Bleedinbluengold · Post by **Bleedinbluengold** » Fri Sep 24, 2004 10:11 am

blackgecko - I believe you can all the info you want by calling the AD's office. I think what you would be looking for is readily available without much hassle.

theblackgecko · Post by **theblackgecko** » Fri Sep 24, 2004 12:45 pm

Actually, I found information on MSU for the 2003 year on the MSU website at http://www.msubobcats.com/deptdoc.php
Click on annual report, then page 14, and it breaks down the sources of MSU's athletic revenue into gate revenue, state support, etc. Haven't found it for Montana yet.

Bleedinbluengold · Post by **Bleedinbluengold** » Fri Sep 24, 2004 3:06 pm

Wayne Hogan has that info.

He's with Ricky Williams in a tent in Australia.