Athletics revenue continues to increase

The Butler men’s basketball team recorded 117 victories in four seasons prior to the 2011-12 campaign.

But team has given more than just wins to Butler.

According to the U.S. Department of Education, the men’s basketball team brought in more than $3.5 million in revenue last year.

The amount made up slightly more than 25 percent of the revenue the Butler athletics department received last year.

According to information submitted in accordance with the Equity in Athletics Disclosure Act (EADA), the department’s total revenue last year was $13.7 million.

“Football and men’s basketball are providing all the revenue in college athletics,” Tom Crowley, associate athletic director for internal operations, said. “We’re not in a revenue-producing situation in football, so for us, men’s basketball provides the revenue.”

The athletics department’s 2010 filing with the EADA showed a revenue increase of more than $3 million from its 2007 filing.

Likewise, the total revenue brought in by  men’s basketball increased by more than $1.7 million between the 2007 and 2010 EADA filings.

The team is one of two at Butler that drew more than $1 million in revenue last season.

Still, the other team, women’s basketball, drew close to $2.4 million less than men’s basketball in 2010.

Athletic Director Barry Collier said that this money does not all stay with the basketball team though.

“It is used to help run the entire department, all 19 sports, all 360 athletes and all facilities because we value each student-athlete and each team,” Collier said.

That fact could be true in part because the department also spent nearly $13.7 million during the 2010-11 school year.

“We’re not in the money-making making business,” Collier said, “but we do need funds to work.”

The department’s spending has increased at the same rate as its revenue between 2007 and 2010.

The athletics department’s budget includes financial aid, labor and factors considered to be non-labor such as travel, equipment, insurance and other miscellaneous team needs.

The budget is determined based on prior spending as well as the needs of each sport.

“We would desire to have a level playing field with the individual opponents for the individual sports,” Collier said. “It has nothing to do with the sport down the hall. [Athletes] don’t play the sport down the hall. They play the sport they’re in against the other nine schools in our league, and that’s how we try to make our decisions.

“At the end of the day, you always have to come up with priorities.”

The budget includes funds from three sources: athletic revenue, a university allocation and donations.

The three biggest areas of revenue for the athletics department are ticket sales, annual donations and corporate partnerships.

Tickets are sold for six Butler teams, and the majority of this revenue comes from men’s basketball.

In addition to ticket sales, Butler has been able to build more than 70 corporate partnerships that provide a wide range of funds.

Vice President for Finance Bruce Arick said the allocation put aside for the athletics department is about $4.3 million and is earmarked for general operating expenses.

The allocation fluctuates based on changes to the salaries and benefits given to all university employees.

The first major part of the athletic budget is financial aid.

There are 103 NCAA scholarships that total more than $4 million. This leaves 256 student-athletes—who are essentially providing revenue to the university—without athletic financial aid.

The university allocation drives the operating staff expenses including the salaries of two of the four highest-paid university employees in Collier and men’s basketball coach Brad Stevens.

Since it is given by the university, the allocation comes from a variety of sources including tuition and fees, net revenue, room and board fees, fundraisers, endowment draw and general interest income.

“We base the allocation on the needs of the department with the expectation that [the athletes] will be successful in the classroom, but we also want to be competitive in the sports themselves,” Arick said.

Collier said that of this $4.3 million, $45,000 comes from student activity fees.

This averages out to each student having approximately $6 of their activity fee going to the allocation per semester. As a result, students get free admittance to every home game of every sport.

“I would say we are the least supported in the Horizon League by allocation,” Collier said. “It’s not all a bad thing. The last thing we want to do is take away from any aspect of the university and be a negative or a burden.”

The department has to make up the remaining $9.4 million that the university allocation does not account for through their own athletic-generated revenue.

“That budget [for operating needs] has never grown, and here we are 20 years later, and we’re still trying to operate on the same level,” Collier said. “The only way we can add more money to that is to create revenue.”

But one area of the department’s revenue that has seen growth is through donations.

The Bulldog Club had 2,800 members who gave unrestricted donations that can be used at the discretion of the athletic director during the last fiscal year.

“This is used to fill in the holes from the revenue side, and there are certain things you have to do to run an athletic department at this level,”  said Bill Lynch, associate athletic director for development. “Each sport also has its own account that can do its own fundraising to supplement its own budget.”

Approximately 50 to 60 percent of the Bulldog Club’s members are alumni, 25 to 30 percent are basketball season ticket holders and some past student-athletes are also members.

The club’s growth has been attributed to several factors within the athletics department.

“The success of the basketball team is a big part of it,” said Mike Freeman, associate athletic director of external operations.  “But we had things in place over the previous years. You don’t give to a sinking ship, and we’re a safe investment because the kids do it the right way.”

Collier said the Bulldog Club is a lifesaver in terms of making up additional revenue, and Lynch said that the department is not set up to survive without donations.

“There aren’t intercollegiate athletics without student-athletes,” Lynch said. “The overriding thing is to provide an exceptional student-athlete experience for them, and every dollar goes back to the program.”

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