SBD/March 18, 2014/Colleges

Michigan Football Accounts For Nearly 60% Of Athletic Department Revenues In '12-13

UM's six home football games generated $37M of the school's $43M in ticket sales
The Michigan football team "accounted for at least" 57% of athletic department revenues in '12-13, which totaled $144M, according to budget documents cited by Kellie Woodhouse of the ANN ARBOR NEWS. Football cost about $23M to operate in '12-13, "meaning it fed more than" $58M into UM's other 30 varsity teams. The $82M "haul doesn't count indirect revenues, such as sponsorships, licensing and advertising agreements" -- which totaled $22.5M that year -- "primarily made attractive by the football and basketball programs." Department revenues rose $41.5M from '09-10 to '12-13, and during that "same four-year period, expenses increased at a similar level," rising from $87M to $132M. Much of the revenue uptick "came from hikes in spectator fees -- like required donations and tickets -- and an increasingly profitable Big Ten conference." Meanwhile, of the $43M in ticket sales at UM during '12-13, $37M "came from Michigan football's six home games." That "doesn't include the seat licenses season ticket holders must pay and the donations necessary for club seats and the 81 luxury boxes." Seat licenses have "become more costly, with the athletic department tacking $100 onto required donations that were already $500 and $250 a seat." Ticket prices also increased in '10, and fans have "certainly grumbled about the uptick in price." But AD Dave Brandon said that sales "are as good as ever." Brandon: "We've been able to sell all of our seats with waiting lists. Our ticket prices for football are still well below many of our benchmark competitors." Meanwhile, men's basketball is UM's "other profitable sport," as it brought in $15M in '12-13 and fed more than $8M into other sports. UM's 29 "non-revenue sports brought in" $8M but "incurred program-specific costs" of $31M (MLIVE.com, 3/16).

STICKING TO TRADITION: Brandon said that the policy on alcohol sales at Michigan Stadium is "not going to change, despite a number of other big-name college stadiums that have begun, or are seriously considering, selling beer during games." The ANN ARBOR NEWS' Woodhouse noted Big Ten schools Iowa, Wisconsin, Illinois and Purdue "sell alcohol in premium seating areas." Brandon: "I just don't think we need to do that." He added, "You've got to set up places to vendor this stuff and you've got to make sure you're selling it to the right people, not the wrong people, and then you've got to deal with all the ramifications of alcohol being served in an area where you've got a lot of young people and a lot of underage people. Sometimes people lose track of the fact that we have to organize and manage 110,000 to 115,000 people all in one tight space, and get them in there and out of there safely. I don't think serving alcohol is going to make that job any easier." Alcohol is available in the football stadiums at about one-fifth of the FBS schools in the NCAA, but Brandon said that the "decision to sell alcohol is hardly ever revenue-driven." Brandon: "I'm not sure at the end of the day you would ever do it for financial reasons. You do it because you've got a lot of pressure from your fans and they expect it and it starts to become more the norm" (MLIVE.com, 3/17).
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