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The cost of winning: UNCs growing athletic budget puts students on the hook :: The Daily Tar Heel

Time:2016-12-01 17:00Shoes websites Click:

Athletic UNCs winning growing budget

The cost of winning: UNC's growing athletic budget puts students on the hook Logan Ulrich | Published 2 hours ago


Photo by José Valle / The Daily Tar Heel

Tune into any TV broadcast of a UNC home football or basketball game, and you might recognize the curly-haired, oft-painted superfan spearheading the screaming student section.

Josh Mayo and his hair — part mane, part afro — have become a staple at UNC athletic events. The senior has attended every home football and basketball game in his four years, along with innumerable soccer, volleyball and women’s basketball games.

He’s not the only superfan to walk the steps of Kenan Memorial Stadium. Ten years ago there was probably another UNC student just like him.

But unlike his counterpart from 10 years ago, Mayo and every other student currently enrolled at UNC pay a higher price for the privilege of attending games.

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In 2005, UNC athletics generated almost $55 million in revenue. By 2015, that number rose to almost $90 million, mirroring the boom seen almost universally across college sports. Yet collectively, students in 2015 paid two and a half times more in fees — almost $250 per student per year — than their counterparts a decade earlier.

With no end in sight to ballooning revenues, particularly with the ACC’s July TV deal with ESPN poised to accelerate profits, students are shouldering more of the burden of supporting athletic programs than ever before.

Like other schools across the nation, UNC is spending more. Winning isn’t cheap, and behind the Tar Heels’ trip to the ACC Championship in football and national title game in basketball are costs that continue to grow.

To fill in the gaps, UNC turns to students.

“They rake in millions year after year, but yet they keep coming back ... and asking for support from students,” said Jay Smith, a history professor at UNC and noted critic of the business of college sports. “And at some point, doesn’t something have to give there?”

How we got here

Student fees have been a tradition for almost as long as college athletics. At UNC, athletic fees help pay for students’ free access to all sporting events, as well as maintaining athletic facilities.

That’s not all the fee does, however. While the business of college sports has grown more and more lucrative, particularly in the past decade, expenses have risen at virtually the same rate as profits.

According to a Washington Post analysis of financial reports from 2004 and 2014 submitted to the NCAA by 48 schools in the Power Five conferences, combined revenue for the schools rose from $2.7 billion to $4.5 billion. The 10-year increase in expenses was virtually the same, and that trend is mirrored at UNC.

“If we’ve had any surplus bottom line, it’s not been that significant,” said Martina Ballen, chief financial officer for UNC athletics.

Student fees made up around 8 percent of UNC’s athletic revenue in 2015. With the University’s razor-thin profit margin, UNC would be solidly in the red without student fees.

“We have always tried to look at student fees as a last resort,” Ballen said. “We really try to look at what other sources or ways we can impact revenue to grow revenue. And also to look on the other side, where we can contain or cut expenses.”

The bulk of the increase in UNC’s student athletic fees comes from a $150 hike between 2005 and 2007. The University raised the fee 150 percent in exchange for the athletic department returning the 25 percent of trademark and licensing revenue it had previously received. The concession was well worth it for the athletic department, whose share of that trademark and licensing would have totaled less than $1 million in 2013 — the same year it made nearly $2.5 million in student fees.

The justification for the fee was to increase salaries for UNC’s Olympic sports coaches, who at the time ranked in the bottom third of the ACC in salary, and to pay for renovations to Carmichael Arena.

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