Monday, January 08, 2001
NCAA chief warns of financial collapse
The Associated Press
LAKE BUENA VISTA, Fla. — Universities must rethink how they make and spend their money, NCAA Ppresident Cedric Dempsey warned the organization's membership Sunday.
“Pressure to keep up with the Joneses and truly be competitive has pushed many athletic programs — and their institutions — into great debt,” Dempsey said to the more than 1,000 delegates at the NCAA's 95th annual convention. “Too many athletics administrators are walking a financial high-wire with no net as they try to balance the books. We very well may be setting ourselves up for a huge financial fall unless we find a way to control costs.”
Dempsey, in his State of the Association address, explained that the 970 member schools are bringing in $3 billion annually — but are spending $4.1 billion.
As possible solutions, Dempsey offered that the NCAA reconsider its expectation that Division I programs be self-sustaining. He also called for a comprehensive study on football issues.
“The latest revenues and expenses research tells us that football, more than any other sport, may be the major factor that widens the gap between the 'haves' and the 'have-nots,”' Dempsey said.
In the Division I-A ranks, Dempsey said he's concerned that the rich are getting richer while the poorer programs are sliding further into debt.
Dempsey noted that the number of I-A programs where revenues exceed expenses without institutional support grew from 43 schools to 48 from 1997 to 1999. Also, profits at those schools more than doubled, increasing 124 percent from $1.7 million on average to $3.8 million.
But the deficits at the 66 remaining I-A schools increased by 18 percent.
Dempsey cautioned against the danger of universities trying to bring in more money at the expense of the member schools' institutional integrity.
“The level of cynicism over the commercialization of our most visible athletics programs has reached epidemic proportions,” Dempsey said.
Dempsey recalled that when taking over as the University of Arizona's athletic director in 1982, he was told that the department had a $450,000 deficit, and he was expected to find the revenue to erase the shortfall.
“I understand why people are paying coaches as much as they are right now,” Dempsey said. “It's all driven to balance the books. They want to win to bring people into the stands to pay the bills.”
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NCAA chief warns of financial collapse
