The Auburn Athletic Department ran a 13.7 million dollar deficit last year.
(Photo by Acid Reign.)
War Eagle, everybody! A sobering bit of news came out this week from the Plains, amid great stories about new oaks, amazing basketball victories, gymnastics moving up to #8 in the country, and fine Auburn men at the NFL combine. Success comes at a price in big time college athletics, and Tiger supporters are experiencing a bit of sticker shock this week. It was revealed that not only did the athletic department lose $13.7 million last year, but that it was the second year in a row of running a deficit. Auburn’s total athletic debt is a staggering $109.4 million! Auburn paid $10.88 million in interest on that debt just last year.
A laundry list of reasons for such deficits can be trotted out. It takes big bucks to attract the best coaches, and Auburn appears to be committed to paying for the best as it made defensive coordinator Will Muschamp the highest paid assistant coach in America recently. Auburn has made splashy, expensive coaching hires in the past couple of years, while also paying large buyouts to fired coaches. Gene Chizik, Tony Barbee, John Pawlowski and Ellis Johnson are still on the payroll.
Facilities expenditures have increased this decade, as a new state of the art basketball arena was built, and several stadium projects were completed. These included new Heisman-winner statues and murals outside the stadium and new items inside, celebrating the 2010 national championship.
A look across the state at Auburn’s neighbor in Tuscaloosa reveals a different picture. Alabama reported an operating surplus of $33 million. How can this be? Is Alabama really that much better at making a profit? Some will point to more coaching stability, although a potential dismissal of basketball coach Anthony Grant will add to the Tide’s tab. Still, the Tide athletic department did expand Bryant Denny Stadium to a capacity greater than 100,000 in the last decade.
The real answer is incoming donations and endowments. While Auburn is attempting to compete at the highest levels in the SEC, support hasn’t been anything like what Alabama has received. Call them sidewalk alumni if you want, but Tide supporters give. Alabama received $10.7 million in endowment/investment money, while Auburn received just $1.2 million. Alabama raked in $34.9 million in ticket sales last year, to Auburn’s $28.2 million.
As big as the above Tide advantages are, where they really clean house is in licensing and royalties. Alabama reported $29.1 million from those areas, to $11.6 million at Auburn. Folks are buying those Tide items, and Alabama can command top dollar on those deals.
So, should Auburn rein in athletic spending and try to pare down the debt? Sadly, that won’t work. Auburn has to win, to keep revenues flowing in. Field championship teams, and revenues will flow in. This also helps the university at large, as donations to the academic side tend to mirror athletic donations. We’ve seen what support looks like when the Tigers aren’t good on the field. See the picture below.
Auburn vs. Texas A&M, 2012.
(Photo by Acid Reign.)
I’ve seen opinions both ways on the subject of college athletics, and what it costs. It can be argued that Auburn’s goal is to win championships, and that striving to do so will bring in the money to keep it all afloat. I can pretty much guarantee that there is more celebrating when Auburn wins SEC or national titles than when the athletic director announces a budget surplus. How many folks remember Jay Jacobs announcing that in 2010 Auburn had a $1.7 million operating surplus? I think even a win over the Mississippi States of the conference generates more enthusiasm. Like it or not, deficit spending is here to stay.