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Big Red Business: Nebraska athletics remains in the black

The Big Red Machine’s bottom line remains a distinct, familiar color -- black.

Nebraska’s athletic department posted a $6.6 million operating profit -- once again with no outside subsidies or student fees -- in its 2018 fiscal year that ended July 1, according to the department’s annual financial report filed with the NCAA.

According to the report, the 10 men and 14 women’s teams generated total revenue of $142.223 million in 2017-2018. Thanks to Big Ten revenue sharing, and marketing and licensing deals, that’s a sharp increase from the 2016-2017 fiscal year when the department reported $120.205 million in revenue.

On the expense side, the athletic department spent $135.627 million in its latest fiscal year, up from $112.571 million spent in fiscal year 2017.

Nebraska saw it's overall generated revenue go up from $120.205 million in 2017 to $142.223 million in 2018.
Nebraska saw it's overall generated revenue go up from $120.205 million in 2017 to $142.223 million in 2018. (Getty Images)

Of the $6.6 million surplus, $5.4 million was transferred to the university’s administration to support academics. As recently as 2014, that contribution amounted to about $3 million and is now expected to exceed $10 million in the current fiscal year.

In addition, $800,000 was used to support other athletic department programs launched over the past year, and $400,000 was stored in the department’s rainy day fund, the report said.

The NCAA requires Division I public universities to submit the revenue and expense reports annually. The latest report encompasses the first eight months of Bill Moos’ tenure as athletic director and the final season for football head coach Mike Riley. Moos replaced Shawn Eichorst, who was let go in September 2017. Scott Frost was hired as head football coach at the end of the 2017 season.

Dollar details

While the athletic department is now more than halfway through its current 2018-2019 fiscal year, the 86-page financial statement provides a detailed dollar-for-dollar look at how much the department brings in and dispurses. It shows everything large and small -- money from concession sales, Big Ten conference revenue sharing, and media rights, spending on salaries, financial support for the spirit group, and equipment and uniforms.

The Big Ten Conference’s revenue sharing distribution generated the most revenue for the athletic department in fiscal year 2018, bringing in $47.938 million. Ticket sales were next, generating $37.196 million, which was largely unchanged from the previous year.

Sponsorships, royalties and licensing agreements, such as with Adidas, generated $25.806 million in the most recently completed fiscal year, the report said.

The athletic department spent $28.9 million in the last fiscal year on administrative expenses, and about $26 million on administration salary. At the time, it was also paying nearly $13 million in severance (money that is largely off the books and no longer owed.) NU made their final payment to former head coach Bo Pelini this month. They have already paid off Mike Riley, his coaching staff and former Athletic Director Shawn Eichorst.

Nebraska had three revenue sports again this past year - football, men's basketball and volleyball.
Nebraska had three revenue sports again this past year - football, men's basketball and volleyball. (Getty Images)

Among other fiscal 2018 highlights:

*Three sports reported operating profits -- football, men’s basketball, and women’s volleyball.

Football generated $94.24 million in revenue in 2017, while expenses were $47.86 million. Men’s basketball a year ago brought in $19.54 million, while expenses were $7.98 million.

Women’s volleyball brought in $4.23 million, with expenses of $3.36 million.

According to athletic department chief financial officer John Jentz, the school “is in the very unique position to have three sports that generate more revenue than expenses. This is extremely rare compared to our peers.”

On the other hand, women’s basketball produced revenue of $2.86 million, but expenses of $4.24 million. Nebraska volleyball is one of only a few women's sports programs that make an overall revenue in all of NCAA athletics.

*Nebraska paid its head coaches and assistants about $20 million in salary and bonuses.

*Donors contributed $16.52 million.

*The athletic department shelled out $2.9 million during the 2017 season to cover home football game day expenses such as officiating, security, event staff, and an ambulance.

*There were 589 male and female student-athletes, while the total number receiving some form of financial aid was 453. That amounted to $12 million in student-athlete financial aid.

*Once again, Nebraska’s athletic department did not rely on any direct state or other government support, nor did it receive funding from the university at large, or from student fees.

“Nebraska athletics is in a healthy financial position today,” said Jentz. “Due to tremendous fan support and full financial membership in the Big Ten Conference, it is one of the few programs to receive no state, university or student fee dollars, while providing a model student-athlete experience and transferring funds for institutional use.”

Nebraska will still be a long ways behind schools like Michigan and Ohio State in total annual revenue, but they should be right with teams like Penn State and Wisconsin now that they have a full revenue share going forward.
Nebraska will still be a long ways behind schools like Michigan and Ohio State in total annual revenue, but they should be right with teams like Penn State and Wisconsin now that they have a full revenue share going forward. (Getty Images)

Comparisons 

The NCAA’s revenue and expense report is one of the best ways to compare the financial health of member schools since all must follow the same externally audited parameters. Some private schools, such as Northwestern, do not file financial statements with the NCAA.

(Last July, HuskerOnline reviewed the athletic department’s forecasted budget for the current 2019 fiscal year. Because of accounting differences, Jentz explained that some of the comparative data in that report for the 2018 fiscal year does not correspond to information provided in the NCAA report. )

A USA Today database, built with fiscal year 2016-2017 data, ranks Nebraska No. 23 nationally and No 7 in the conference in terms of revenue. Ohio State and Michigan led the conference, both with revenue that year at more than $185 million. The schools were also ranked nationally at third and fourth respectively.

Then came Penn State ($144.01 million), Wisconsin ($143.42 million), Iowa ($130.68 million), Michigan State ($126.02 million), and Nebraska ($120.21 million).

The remaining conference schools: Minnesota ($116.37 million), Indiana ($106.13), Illinois $97.45 million), Rutgers ($96.88 million), Maryland ($94.88 million), and Purdue ($84.84 million).

While USA Today’s database probably won’t be updated until summer, here’s a sampling of some schools that have released financials for the 2018 fiscal year.

Texas reported another year of more than $200 million in revenue. For fiscal 2018, it had more than $219 million in revenue and total expenses of $206.5 million, according to USA Today.

Ohio State and Texas A&M also broke the $200 million revenue mark, making it the first time three public universities had cross that benchmark in one year. Ohio State reported fiscal 2018 revenue of $205.6 million and expenses of $203.8 million, while Texas A&M generated $212.4 million and spent $165.8 million.

In addition, Missouri for the second straight year operated in the red, with a nearly $2 million deficit in its athletics program. It reported revenue of $107.35 million and expenses of $109.16 million. It received a $1.02 million subsidy from the university, which is the same as the past few years, according to a Kansas City Star report.

Questions, comments, story ideas? Reach Steve Rosen at sbrosen1030@gmail.com.