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May 17, 2001

Report details subsidy of athletics: $11 million in direct, indirect costs

Pitt subsidized its intercollegiate athletics program by nearly $11 million last year, according to a study by the University's Office of Budget and Controller.

The $11 million figure included both direct and indirect support.

Direct support attributed to athletics includes coaches' salaries, travel and business expenses, and student financial aid, among other operating expenses. For the fiscal year that ended June 30, 2000, direct expenses exceeded direct revenue (from ticket and concession sales, TV and radio money, NCAA/Big East revenue sharing and other sources) by $8.21 million.

Indirect support includes building depreciation, physical plant costs, administrative overhead and other expenses. The indirect support subsidy for last year was $2.77 million.

The annual cost study, which is required by the NCAA, also incorporated gifts to athletics ($94,773), income from camps and clinics ($6,785) and unspecified "other restricted revenues" ($262,635) last year.

The department declined to comment on the report. But athletics administrators have argued in previous years that the lower, direct revenue/expense numbers are more accurate than total revenue/expenses in reflecting Pitt financial support of their program.

Last year, FY 2000, the University's total subsidy of athletics was $10.98 million (up from $8 million in FY 1996, the year that Pitt began publicly reporting athletics budget data). Direct expenses exceeded direct revenues by $8.2 million last year (up from $4.87 million in FY 1996).

Last year, Pitt subsidized its football program — one of the two so-called revenue-producing NCAA sports — by $1.18 million (total support) or $215,598 (counting only direct expenses and revenues), depending on which calculation you use.

Men's basketball, the other "revenue-producing" sport, cost the University either $465,151 (total) or $178,772 (direct) more than it generated in revenue.

Pitt's direct subsidy of its women's basketball team was nearly 10 times that of its men's team: $1.73 million. The total subsidy was nearly $1.9 million.

The University's total subsidy of its non-revenue producing sports was $9.3 million. The direct subsidy of those sports was $7.8 million.

Among the revenue attributed to the Department of Athletics last year was a $1.3 million "student seating allocation."

This money was transferred from the Office of Student Affairs to athletics to cover the difference between a full season ticket price and the discounted price paid by students for football and basketball tickets.

"This process has been in place at the University for nearly 30 years and is consistent with NCAA reporting guidelines," according to a report prepared for the University Planning and Budgeting Committee (UPBC), an advisory group of Pitt faculty, staff and administrators.

Even so, the $1.3 million came out of Pitt educational and general operating funds, noted Philip K. Wion, an English professor who serves on UPBC and chairs the University Senate's budget policies committee.

"The $1.3 million is not income generated by the athletics department, which is what you might assume when you see it listed as revenue," Wion said.

For years, the Senate's budget policies committee has scrutinized Pitt athletics finances. Wion commented: "During the year covered by this report, the football team was playing its home games at Three Rivers Stadium and the men's basketball team was playing its next-to-last home season at the [6,800-seat] Fitzgerald Field House.

"We can hope that, as our sports teams continue to improve, and when the football team begins playing at the Steelers' new stadium and the basketball program moves into its new home at the Petersen Center [which will include a 12,500-seat arena], the athletics department will generate more revenue and the University's subsidy can be reduced."

–Bruce Steele

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