- Email letter originally sent to COIA members April 2005

 

Dear Coalition Members,

In the coming weeks and months, the Coalition Steering Committee will have
opportunities to meet with various outside groups to discuss issues of
financial management and cost control in athletics, and the appropriate
principles to guide commercial engagement.  We expect to be learning more
about these issues from a national group of ADs.  Most significantly, we
have been told we'll have opportunities to interact with the finances
subcommittee of a new NCAA presidential task force on athletics, and later
in the summer with the task force itself.  These are good venues to
contribute to the issues that are at the heart of our difficulties in
athletics.

The Steering Committee has formed a subcommittee to focus on preparation for
these meetings, and we want at an early stage to get your feedback.  We are
particularly anxious to hear from colleagues at non-BCS schools, whose
viewpoint has so far been underrepresented in the Coalition.

In this message, I'd like to summarize a series of previous positions the
Coalition has taken and inventory the points we'll hope to address.  Please
contribute comments on any part of this document as a way of helping the
Steering Committee better understand the circumstances and opinions of
Coalition members.  We are not drafting any policy documents for public
consumption - this is a practical effort to strengthen our understanding and
skill as we first take a place at the table where these issues will be
discussed.

Issues of financial responsibility

There are two sections from our original Framework document that pertain to
basic principles underlying our approach to financial issues (Sections IV.1
and 2):

 "1. Winning and revenues. Winning is the goal of athletes and coaches, and
programs appropriately promote winning. In the revenue sports, winning is
also generally viewed as essential to financial health. However, to the
degree that financial success is tied to winning, intercollegiate athletics
cannot be healthy on the national level: not only do half of all competitors
lose, but the emphasis on post-season tournaments and national championships
raises the bar and increases the number of programs that fall short. The
link between winning and financial success induces programs to invest in
sports with the goal of financial returns, and drives a competitive cost
spiral. The Coalition supports increased revenue-sharing (beyond the
participants in events) to minimize revenue-driven incentives for winning.
To the degree allowable under federal anti-trust laws, conferences should
also seek to control expenses and capital investment, to create as level a
playing field as possible. Increasing revenue-sharing and limiting expenses
may disadvantage programs that are currently most successful financially;
developing a plan that buffers these effects during the period of reform is
necessary and will take time."

"2. Professional standards and costs. Increased media attention and rising
expectations among fans have led to the application of professional
standards to college sports, including increasingly sophisticated equipment,
facilities and specialized coaching staffs. Training for professional sports
careers is not a goal of intercollegiate athletics, nor does it benefit the
vast majority of college athletes; higher education gains nothing from
serving as a minor league for professional sports. Conferences should
establish standards for equipment, facilities, and coaching staffs
appropriate to amateur competition, and restrain excesses as violations."

These sections focus on the effects for higher education - rather than
individual schools - of the value and motivational structures that
characterize college sports. While we might write them somewhat differently
today (for example, speaking of winning as "one" goal of athletes and
coaches, rather than "the" goal), our assumption is that the basic direction
of these paragraphs continues to express the general perspective of the
Coalition.  We want to find a way out of a situation where we invest large
sums to compete with one another in athletics as a proxy for competing in
academics, where investments are directly tied to our mission.  We want to
escape the belief that all increments in athletics excellence are
self-evidently part of our athletics goal, making unlimited investments to
reach ever-escalating "world-class" standards justifiable, even as they
represent a direct cost or opportunity cost to academics.  And we want to
find ways to highlight how viewing the goal of sports programs (as opposed
to sports competitors) as winning, rather than as educational enhancement,
draws us towards professional sports values that can be in direct conflict
with the academic mission.

Framework Section IV.3 lists some specific areas that we could look to for
cost savings: a) scholarships, b) total football squad size, c) season
length and design, and d) off-campus recruitment.

We announced in the AID an intention to examine a) further, particularly
with regard to football.  We would like to hear more views about whether
this is an important area for cost savings, and if so, what level of
reduction would be optimal to argue for.  Point b) is a related issue.

We have advocated c) on academic grounds in the AID, and based on that and
on the Framework, the position we anticipate taking is that seasons that are
longer or that involve more travel than is necessary to achieve the
educational mission of athletics are not only intrusive on academics but are
an unjustifiable cost that requires support be diverted from the rest of the
institution.  In particular, in the AID we have advocated scaling back
post-season tournaments on academic grounds, and expect to argue on parallel
financial grounds.

Season length is one of a number of respects where expansion or higher
performance expectations in the non-revenue sports (apart from Title
IX-related changes, designed to redress gender inequities) have resulted in
higher costs that are difficult to justify, since they do not generate
compensating income and at virtually every school ultimately must be covered
through campus reallocations.  Obviously, athletes and coaches want budgets
that will allow them to compete at the highest levels, but to reduce other
campus resources more central to the university mission in order to fulfill
these expectations is not good educational policy.  Moreover, the value to
the institution of recruitment and scholarships, high coaching salaries, and
expensive facilities for sports that cannot be claimed to raise a school's
national profile or return income - often while intramural sports and
academics are underfunded - may deserve reexamination.  This is not a matter
of the value of the non-revenue sports themselves: there is no less
intrinsic value to athletes in rowing than in football; it is a matter of
priorities when funding is scarce and the larger body of students may have
stronger claim to it.

In conversations with Knight Commission staff we have been led towards a
focus on how comprehensive the financial implications are of having college
sports of all kinds become basically national rather than conference or
regionally driven.  With so many opportunities to compete for championships
now being pitched on the issue of "schedule strength," the impetus for all
schools is to develop schedules that provide opportunities to overturn
national powerhouses.  This is as much a values issue, concerning how
schools, athletes, and coaches market themselves through sports, as a
financial issue.  This is an area where BCS and non-BCS schools may diverge
because of a confusion of principles (as faculty, most of us likely share
similar basic viewpoints) and pragmatic goals (which will differ according
to each school's particular position, and tend to lead faculty towards
different perspectives).  The more basic divergence may be between schools
of both BCS and non-BCS status that have varieties of advantages outside
athletics (such as longstanding academic reputations, prime geographical
locations, etc.) and those that are trying to overcome disadvantages and see
athletics as a potential asset in this regard.

These issues are difficult because of the great differences among our
schools - one size doesn't fit all.  But the only way to address the need to
change the overall context in which athletics is pursued - which we all
create together - is to do so collaboratively, in spite of differences.  The
Framework's presumption is that we have first to approach reform from the
standpoint of a common interest in strengthening higher education, and then
adjust where we must to ensure that change is not so disruptive for some
that they can't afford to support constructive reform.

There are a range of "financial control" issues that the NCAA presidential
task force will certainly be looking at, and where we can make headway on
meaningful matters.  Among these are:

1) Integrating athletics in the institution's financial structure.  Rather
than keeping athletics "firewalled" as an auxiliary, there may be very
positive potential to requiring that athletics justify expenditure levels on
the basis of value to the institution, regardless of the degree to which it
earns revenues.  Budget and revenue issues are distinct for athletics, and
this will cut both ways, leading to allocations into and out of athletics,
but if the decisions are being made by a group of academic and financial
administrators, the likelihood of scrutinizing what many feel to be an
overly opulent "lifestyle" in athletics will be far higher.  (Steering
Committee member Michael Granof published an editorial on this issue in the
NCAA News, based on his Knight Commission testimony; it's linked from the
COIA website.)

2) Proposals to ensure that all contracts that have impact on students or on
the campus, or that entail use of university resources, must be approved by
the University and made through the University, in the interests of the
University.  This would cover apparel contracts, uses of resources for
coaches' summer camps, and so forth.

There are, in addition, other topics related to financial responsibility.
For example, there are proposals to institute pay-for-play as a component of
revenue sports (which we took a stand against in the AID), and to increase
the value of athletics scholarships to more closely approximate the cost of
education (being suggested by the NCAA leadership).  These proposals (which
have different implications and are argued on different principles) could
have significant financial impact on schools.

Certain obvious financial issues will probably not be at the forefront of
the COIA agenda, most significantly coaches' salaries.  This is because we
know that anti-trust issues foreclose any chance that universities could
work together to restrain salary growth, and we are not planning to enter
the discussion by advocating that universities seek a congressional
exemption from anti-trust laws (a last-ditch tactic, which risks expanding
congress's view of the degree to which it can appropriately regulate
universities in general).  We will, of course, be urging presidents to make
changes in the contexts within which salary levels are determined.
Anti-trust law is unclear about the way these same issues may pertain to
capital expenditures, but we expect to adopt the position that unless
otherwise demonstrated, universities should assume that rules pertaining to
capital expenditures set at the conference or division levels would not be a
violation of law.

Issues of overcommercialization

The section on "overcommercialization" may be the weakest in the Framework,
in part because the term is undefined.

"Overcommercialization.  Televising games can deepen the loyalties of
nationally dispersed alumni and raise public awareness of higher education.
However, the marketing of intercollegiate athletics impairs institutional
control, and may undermine support for academics. It may link universities
to products and corporate sponsors that present conflicts with institutional
values; may impair institutional control over scheduling and contracts; and
may lead to misjudgments of taste that damage public perception of higher
education. "Name recognition" and "fan loyalty" based on televised sports
has not been demonstrated to contribute to the academic mission, and is
costly and unproductive for American higher education; it contributes to a
misperception by young people and parents of the nature and purpose of
higher education, and reinforces an emphasis on athletics over academics in
high schools. Moreover, college programs increasingly emulate features of
professional sports, raising costs that eliminate revenue gains. Stepping
back from over-commercialization entails cost-cutting and the articulation
by presidents and conferences of firm standards of presentation and
 control."

Because of dropping support for higher education and sharply rising costs,
in science, for example, universities are increasingly forced to seek and
try to control commercial support in many facets of the institution. In
discussion with outside groups, we have been and will again be challenged to
clarify what we mean by "overcommercialization," and what's wrong with it.
In earlier discussion in the Steering Committee, we developed this simple
starting point: "Overcommercialization" refers to actions or patterns that
undermine the values or interests of the athletics program, university, or
higher education in order to earn outside financial support.  Of course,
people can disagree about whether individual cases fit this definition.
Here are a few examples of the way faculty might approach thinking about
these matters.  We'd welcome suggestions about how better to articulate
these issues.

Values issues

- Universities expend increasing efforts to bring drinking under control.
If TV contracts made by schools, conferences, or the NCAA bring in many
dollars but send strong messages undermining those efforts, it may be an
instance of overcommercialization.  Cancellation of classes to accommodate
lucrative weekday football telecasts represents a similarly strong
subversion of a basic academic message.

- Universities are arenas of heightened free speech protection.  If
corporate contracts limit the freedom of athletes to speak freely, this may
be overcommercialization.  Similarly, if contracts compromise a university's
preferred position with regard to issues such as corporate employment
practices, this may be overcommercialization.

Taste and image issues

- Universities rely on public support and the good will of donors.  If
corporate contracts appear to associate universities with companies whose
image or public conduct reflect questionable values or taste, this can
undermine a university's interests.  Individual or cumulative associations
with marketing entities and their images, or with styles of media
presentation, can erode the unique standing of universities in public
esteem.  If close scrutiny and frequent review are not applied to monitor
for such problems when contracts are concerned, this may be
overcommercialization.

Conflicts of interest

- Universities are increasingly alert to conflict of interest issues with
regard to corporate involvement, and efforts to identify and manage
conflicts of interest consume increasing amounts of money and time.  This is
a necessary precaution in view of the dangers of unmanaged conflicts.  If
athletics contracts and conduct stemming from them receive less scrutiny and
regulation in order to ensure a revenue flow, this may be
overcommercialization.

Control issues

- Corporate interests are never completely aligned with those of higher
education, and most corporate contracts mean shared control with an entity
that may act in ways that damage the university.  To the degree that need
for increasing corporate support may provide corporations with greater
control leverage in contracts and in college sports-related conduct, this
may be overcommercialization.

As we move towards opportunities to contribute to discussions about reform
in these financial aspects, our primary goal will probably be simple:  to do
all we can to make sure that the university presidents the NCAA has
assembled take an ambitious view of their charge, and adopt COIA's view that
virtually any goal we agree is worthy can be achieved if the time-line for
achievement is set far enough in the future and benchmarks of progress
within a long timetable are part of an adopted plan.

For the task force to attempt serious work, it will probably need a lifetime
of at least two years.  If we're able to use constructive pressure to help
the task force reach important goals, COIA will need a lifetime of another
two years or more - at least a year beyond our original plan.  To do this,
we may need to place the Coalition's governing structure on a somewhat less
ad hoc basis, and we certainly will need to have some rotation of
leadership.  For that reason, I'll be sending you a second message shortly,
focused on the question of a Fall meeting of the Coalition.

The floor is open for discussion on issues of finances and
commercialization.  We are not writing a policy document, we're collecting
insights and learning more about member opinions, so please feel free to
send along your thoughts in rough form.

Best,
Bob