The number of athletic departments showing an operating loss is incredibly misleading though. This is for many reasons, but mostly it’s an accounting thing. First, private universities don’t have to report anything, so we can only include public universities in this category. Second, public universities athletic departments are non-profit entities within the universities, therefore they do not have a goal of showing a profit on their financial disclosures. Third, the financial reporting structure within each university is unique – for example: one athletic department may include a ‘sports pass student fee’ as revenue, others may not. This is tied to the inconsistency in how universities choose to handle different revenue streams. The licensing deals may be 90% from sports, but the university may include that revenue in it’s general balance sheet – not the athletic departments, or maybe 50/50; the point is, they can report that however they’d like. Another example is the university may ‘charge’ the athletic department the full out-of-state tuition and boarding load for every scholarship athlete, even is a significant number qualify for in-state fees. Additionally, donations (even ones ear-marked for athletics) will have a ‘% cut’ taken from the university, and donations for large projects are often times held on a separate balance sheet, until that project begins. And since the only reporting available is a snapshot in time, this revenue stream would not appear until the year the project begins.

There are obvious exceptions to this (i.e. Cal), where they are not generating enough from the few revenue sports to offset the 29+/- non-revenue sports. This is where Title IX is a financial burden (not speaking to the merit of it, just the finances), but I don’t think most athletic departments are hurting for revenue. The point is, most athletic departments operate according to a budget, and the revenue is broken up yearly to allocate enough funds for that budget. It is not an expenses vs revenue comparison, like we’d expect to see from a for-profit company.

Sorry for the long message.