I don’t usually read the paper version of The Chronicle of Higher Education, but there are two articles in it this week that might require me to find a copy.
The first is “Sports Spending Has Drawbacks, Report Says.” Here’s the summary that appears for free on CHE web site:
The surge in spending on college-sports facilities could prevent institutions from borrowing money for academic purposes, according to a report released this month by Moody’s Investors Service.
The report, “Intercollegiate Athletics Programs: A Winning or Losing Game?,” says the biggest and most successful athletics programs can have a positive effect on the creditworthiness of their institutions.
But a majority of intercollegiate athletics programs require substantial institutional subsidies to balance their operational budgets, and do not have significant revenue from ticket sales and donations. Those programs could hurt their institutions’ credit rating, the report says.
This is potentially really important because (as I understand it, second and third hand) the reason why the BoR wants to “strategically” spend money on athletics– or at least the claim they want to make– is that sports will be beneficial to EMU’s financial bottom line, that it will improve our image, that it will attract students, etc. I think the conclusion that Moody’s is suggesting ultimately is that none of these things are actually true.
The report is a mere $550 from Moody’s….
The Chronicle of Higher Education Athletics
http://chronicle.com/weekly/v53/i47/47a03002.htm
From the issue dated July 27, 2007
Sports Spending Has Drawbacks, Report Says
By BRAD WOLVERTON
The surge in spending on college-sports facilities could prevent institutions from borrowing money for academic purposes, according to a report released this month by Moody’s Investors Service.
The report, “Intercollegiate Athletics Programs: A Winning or Losing Game?,” says the biggest and most successful athletics programs can have a positive effect on the creditworthiness of their institutions.
But a majority of intercollegiate athletics programs require substantial institutional subsidies to balance their operational budgets, and do not have significant revenue from ticket sales and donations. Those programs could hurt their institutions’ credit rating, the report says.
“A well-run athletics program or a particular team’s sustained success might contribute to long-lasting, stronger student demand, national name recognition, and philanthropic support, thereby creating positive credit momentum,” the report says.
In the report, Moody’s says that college administrators considering upgrading their sports facilities should ask several questions:
*
Was a feasibility study completed?
*
What are the facility’s revenue and expense projections, and how much institutional subsidy will support its continuing costs?
* Is there a risk that raising funds for this project will hamper fund raising for other institutional priorities?
For a copy of the report, send an e-mail message to roger.goodman@moodys.com
http://chronicle.com
Section: Athletics
Volume 53, Issue 47, Page A30
Copyright © 2007 by The Chronicle of Higher Education
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OK so if one of the criteria is that the program be well-run and/or a “sustained success” then I nominate EMU track and EMU swimming/diving to become our flagship sports programs. A football team that hasn’t had a winning season within the lifetime of the typical college freshman (I’m guessing – but I bet it isn’t far from the truth) surely isn’t worth gutting the academic side of the university.
As an added bonus, for whatever reason, I’ve noticed that swimmers and track athletes tend to be pretty serious students, too. Maybe this is because they know the chances of making a pro career out of their sport are approaching zero…
Well, the good news is that we do have a well-run program, winning an all-time record of MAC Championships. We need to look at the good things whenever we can.