A new report confirms that the University of Alabama-Birmingham did not need to cancel its football program for financial reasons.
Marvin Gentry-USA TODAY Sports
When the University of Alabama at Birmingham announced last December that it was eliminating its football team, chaos and confusion followed. School president Ray Watts originally claimed the sport was a money-loser. However, VICE Sports, among others, showed that his math was suspect—and that subsequent explanations were equally dubious. Meanwhile, local journalists suggested that Watts's decision was more political than financial. All of this led to calls for his resignation; votes of no confidence; even more evidence that the numbers were cooked; and finally, the school creating a special task force to get to the bottom of the issue.
Guess what? The case for killing UAB football still looks fishy.
Such is the conclusion of College Sports Solutions (CSS), a consulting firm hired by the aforementioned task force. Earlier this week, CSS released a report on the financial viability of UAB football, concluding that:
- A previous economic report cited by Watts which claimed that football would cost the school $49 million over five years was based on "flawed" assumptions and therefore not valid;
- Keeping or dropping UAB football isn't likely to save (or earn) the school a tremendous amount of money, which makes the program's future less a matter of fiscal stewardship than of stylistic choice.
Not coincidentally, many of the CSS report's conclusions are broadly similar to the ones made in my previous VICE Sports articles, as well as an extensive report prepared by my economics firm. (Full disclosure: my firm originally was hired by UAB to do basically the same job as CSS, then asked to stop.) Based on hard evidence, both CSS and I believe that Watts is misguided, that the school can afford football. and that the sport can even be a net positive, both to UAB's public standing and bottom line.
Let's take a closer look at what CSS had to say, and what it means for UAB football:
CSS appears to have been granted excellent access to key school stakeholders. The report's authors conducted a panel with key school donors. They were allowed to speak by phone with a member of the University of Alabama System's Board of Trustees. They even were allowed to speak with Watts, something the Birmingham City Council has been unable to do.
CSS also found that the original economic report prepared by the consulting firm CarrSports and cited by Watts rested on faulty assumptions, ones that painted UAB football as a money pit:
- CarrSports' assumption that UAB could remain in Conference USA as a non-football playing member was "flawed"; moreover, the school did not engage in "definitive discussions" with other conferences regarding possible membership prior to announcing its decision to kill football;
- Losing out-of-state-tuition from athletes in football, rifle, and bowling—the three sports Watts announced would be axed—"represents a significant loss of revenue that would not be replaced";
- A proposed (and presumably costly) indoor football practice facility was not an essential short-term need for the continuation or reinstatement of football, but rather a "long-term desire";
Also noteworthy? Some of the biggest potential sports expenditures in the CSS report are the first-year costs of re-starting football. In other words, by ending the sport because of purported financial concerns, school decision-makers like Watts have made restoring football more expensive than if they had just done nothing. D'oh!
Tellingly, the CSS report paints a picture of a UAB alumni, booster, and athletic community that tried to do what it took to keep football and the other two sports—beloved community assets—alive, only to find themselves repeatedly rebuffed, an outcome that hasn't served the school's interests very well:
... A strong message received from the people and groups with whom we spoke, including faculty, students, alumni, donors, friends and community leaders, was their desire to be given an opportunity to provide meaningful financial support for these sports, and for UAB Athletics in general–in essence to be asked to help. It appears that all of these constituent groups, without exception, have made substantive offers of support to reinstate these sports ... there is little doubt that the strong consensus among the student body (graduates and undergraduates), faculty, and staff was that the elimination of the three sports, particularly football, has been detrimental to the University ...
Despite having a pro-football bent, I believe the CSS report far undersells the sport's benefits for UAB. Here's why:
- CSS pegs future football donations at a level well below current announced commitments by the UAB task force subcommittee charged with fund-raising: while the report assumes donations of less than $900,000 per year, boosters, students, and the City of Birmingham already have pledged $2.5 million per year. Multiply that by five years, and that's roughly $8 million more than CSS assumed. And the fund-raising is still ongoing, with an additional $1 million announced in the few days since the CSS report was released.
- CSS substantially overstates UAB football's expenses. How so? By not accounting for the difference between the price of athletic scholarships and their actual cost. In my firm's report, we found that of the $2.8 million in scholarship expenses devoted to football, bowling, and rifle, only about $1 million was a real cost to the school. The rest was either UAB charging athletics for its own above-cost mark-ups—such as charging the athletic department full retail prices for food, when the school itself only pays wholesale and/or gets a rebate from its food service provider— or failing to consider the tuition payments made by athletes that would be lost without the sports. (To wit: UAB actually makes money from women's bowling, despite showing paper losses of more than $200,000).
- CSS assumes that without football, UAB will likely join the Missouri Valley Conference (MVC)—but then fails to mention that moving to the MVC would require a significant increase in travel expenses, something the school itself concluded in 2008. My firm estimates the total increase to be at least $900,000.
- CSS estimates that UAB will take in $980,000 in College Football Playoff revenue if it keeps the sport, yet sticks with a knowingly low-ball estimate of $800,000.
- CSS assumes that UAB will receive $1.5 million per year in "guarantee revenue"—that is, the money smaller schools receive to play road games at bigger schools—by 2019-20. I think that's low, given that in 2013-14, UAB received $1.7 million in guarantee payments.
All of the above items add up. The CSS report finds that by 2019-20, having a football team will cost UAB $3.6 million more per year than not having one. By contrast, my numbers indicate that having football will make UAB $1.6 million per year, and more as donation pledges continue grow.
I have more quibbles, and if you have the inclination, you can read about them here. The important thing to keep in mind is that even in spite of these numerical disagreements, CSS concludes that restoring football:
... would foster much good will and stimulate a substantial amount of spiritual and financial support from alumni, donors, ticket holders, friends, students, faculty and the community. It could create a unique opportunity, not only through that support, but also through unprecedented positive national attention to the University ...
The Bottom Line
There's no way to read the CSS report critically and conclude that a UAB administration focused on maximizing the school's overall health would remain obstinate in its opposition to football. Perhaps unsurprisingly, news reports in Alabama indicate that the decision to cancel the sport likely preceded the report used to justify it—a report that has now been thoroughly debunked by two second opinions.
People in Birmingham are all but begging to throw money at UAB to fix this mess, never mind that the school created it in the first place. Yet when I talk to people close to the situation, all of them tell me that they believe the UAB administration is still looking for excuses to kill football. What will be very telling is if you see UAB administrators insist that the supposedly independent CSS add in millions of dollars in additional expenses to their keeping/restoring football scenario—and few or no changes boosting expected football revenues—in order to help justify a decision not to bring the program back
Remember that old "Schoolhouse Rock!" song about interjections? Maybe UAB's brain trust is fighting this so hard because they're actually rooting for the other team.