Big Red Business: How Nebraska spends $10 million from athletics
Congratulations to all 4,000 students who were just offered Husker Scholars money for the upcoming school year. Now, while the thrill is fresh, take a few minutes and write a thank you note to Nebraska’s athletic department.
Those scholarships -- four award programs in all -- are funded entirely by $5 million the athletic department transfers to the university to academically support non-student-athletes on the flagship Lincoln campus. Husker scholarships were offered to high school seniors from big and small schools in every corner of the state where there’s a dot on the map.
While many athletic departments receive institutional funding, state appropriations or student activity fees, Nebraska is one of a handful of programs that does the reverse. And few schools do it bigger.
Now in its second installment, the athletic department contributions -- supported initially by then-athletic director Shawn Eichorst -- have allowed the university to offer scholarships to more than 7,000 students.
The latest batch, announced in mid-April, are up from the nearly 3,000 students who received the funds in fall 2018 for the current academic year.
Put another way, about 15 percent of the 20,000 undergraduate students on the main campus received Husker scholarships last year. That climbed to 20 percent this year, with the offers that just went out.
“Our goal is to put every dollar to work,” said Amber Williams, an assistant vice chancellor for academic services and enrollment management. To brand the Husker scholarship program, she said, it was “purposely named to align with athletics.”
In addition to the $5 million Husker Scholars commitment, the athletic department had previously been transferring another $5 million to the university to be used by the chancellor at his discretion.
This money has been used for university operations and other priorities, including operational support for student enrollment efforts, support for the student recreation center, academic support services for student-athletes, and for various deferred maintenance and operational expenses.
“Athletics has provided support to academic operations for many years and we are extremely grateful to our fan base for making it possible,” said Leslie Reed, the university’s director of public affairs.
So, the total out of the athletic department’s bank account: $10 million.
That’s no small commitment, even for an athletics program that generated more than $142 million in revenue in 2018.
Altogether, the athletic department will transfer more than $27 million to the campus this current fiscal year, including $12 million in financial aid, housing and other goods and services, said athletic director Bill Moos.
That doesn’t include what the football program pumps into the Nebraska economy from the likes of taxes, gasoline, lodging and retail sales.
The chunk of the $10 million commitment comes from revenue arising from Nebraska’s Big Ten membership. That revenue sharing conference check now exceeds $50 million annually.
Nebraska is among about two dozen public Division I universities that operate financially self-sufficient athletic departments, based on NCAA and various other accounts. The department reported a $6.6 million operating profit in fiscal 2018.
The athletics money conveyed to the university helps stretch academic budgets at a time when state legislators are calling for belt-tightening, hiring freezes and other higher education austerity measures.
Here are descriptions of the scholarships funded through athletic department contributions:
*Husker Living and Learning scholarships of $2,500 are awarded to Nebraska resident and non-resident students who will live in university housing and demonstrate an interest in “rigorous academic scholarship and zeal for leadership, service and/or diversity.
*The Husker Traditions scholarship is for $1,500 and renewable. It is awarded to Nebraska residents who have demonstrated high academic potential.
*The Husker Power scholarship is for one-year and $1,500. It is awarded to Nebraska residents who have demonstrated high academic promise.
*The Husker Access scholarship is a one-year, $1,500 package used to recruit promising students regardless of where they live.
The four scholarships are only available for students on the Lincoln campus.
Managing the gift
Amber Williams is the envy of many of her peers around the country who oversee enrollment and financial aid awards. It’s largely because of the financial and academic relationship her department has with Nebraska athletics.
“It is not the norm” with NCAA Division I schools, she said, “and certainly not at that level of money.”
Perhaps the real kicker, said Williams, is that this scholarship program is a long-term commitment, not a one-year thing.
With the goal of keeping college affordable especially for Nebraska residents, Williams is pleased with the results. So far, 40 percent of the Husker scholarship awards have gone to students who will be the first generation from their family to attend college; and about 62 percent of the recipients have demonstrated financial need for the money based on federal student aid application.
For the 2019-2020 academic year, the estimated cost for an in-state resident to attend Nebraska is $25,780. That’s the sticker price -- not the final discounted price after scholarships and other aid -- and it includes $9,522 in tuition, plus housing, meal plans, books and other fees.
Williams is also very cognizant of the number of Nebraska high school students who have left the state to go to college elsewhere in neighboring states. Her mantra is to keep Nebraskans at Nebraska.
“With this money, we feel we have more opportunities to retain (students) and keep them here,” she said.
Nebraska athletic department is certainly not unique with its contributions to university-wide academic programs.
HuskerOnline sampled policies of a few other Big Ten schools. Of those that responded:
*Michigan’s transfer policy fluctuates from year to year, and there is no prescription on what the funds are used for, a spokesman said.
For fiscal year 2019, the athletic department has forecasted a transfer of $5.8 million. That’s down from $9.1 million the previous year.
From fiscal year 2014 through 2017, the athletic department contributed a total of $9.25 million to the university.
Kurt Svoboda, an athletic department spokesman, said these fund don’t fully take into account the total money transferred to the university for other purposes, such as money to renovate recreational buildings on campus.
*Iowa since the 2016-2017 fiscal year has transferred $2 million annually to the university from the athletic department’s operating budget. The total, through 2017-2018, has been $4 million, a spokesman said.
This is in addition to the other operating costs for facilities, scholarships and other miscellaneous general university services that athletics pays to other campus departments.
*Ohio State’s athletic department does not send over any specific amount for general scholarship funding, said Joseph Odoguardi, the department’s chief financial officer. However, athletics will “help fund initiatives as they come up,” he said.
For example, the athletic department is committed to giving $1 million a year for ten years for the school’s main library renovation, he said.
The department also paid $21.3 million in fiscal year 2018 for student-athlete scholarships. The school has about 1,100 student-athletes and about 750 receive some form of financial aid, Odoguardi said.
*Purdue’s athletic department has committed $12 million to the Krach Leadership Center on campus. This is in addition to the athletic department’s more than $11 million annual student-athlete scholarship bill, a spokesman said.
*Illinois athletics has sent $100,000 per year for the past three years for the Illinois Promise scholarship fund.
*Minnesota does not provide any surplus money back to the general campus in addition to the $11 million-plus it covers in scholarships for student athletes, a spokesman said.
Everything is bigger in Texas, and that goes for revenue transfers too.
In fiscal year 2018, the University of Texas athletic department conveyed $10.7 million to academics. That was up from 2017, when the Longhorns transferred $10.3 million to the university, according to USA Today data.
The transfers, which occur annually, have amounted to about $40 million back to the university in recent years.
The Texas athletic department generated about $219 million in revenue, and $206 million in expenses, according to its latest NCAA revenues and expenses report.
Other public university athletic programs that transfer money back to the university include LSU, Florida, Tennessee, and Oklahoma.
While every dollar helps, some higher education experts are calling for an even greater financial commitment from athletics.
According to a Chronicle of Higher Education report, less than $1 of every $100 generated by major college athletic departments is directed to academic programs on campus.
Steve Rosen writes about the business of sports. Questions, comments, story ideas? Reach Steve at firstname.lastname@example.org.