Boosting the Bottom Line Through Athletics

When the University of Arizona's men's basketball team takes on California State University, Long Beach today, it will mark the beginning of the National Collegiate Athletic Association’s wildly popular and lucrative men’s basketball tournament known as March Madness.

The Wildcats—a contender to make a run for the national championship given their high seed and strong regular season record—are an anomaly at Arizona: a team that generates positive revenue for the university even as the athletics department struggles across the board.

After the discovery of a $177 million shortfall, caused by a flawed budget model and overspending on strategic initiatives, Arizona President Robert Robbins warned that “draconian cuts” could be coming—particularly in the athletics department, which operates at a loss and has been slow to pay back a $55 million loan from the university during the coronavirus pandemic. Individual sports, Robbins warned in November, could be on the chopping block.

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As a revenue-generating sport, men’s basketball is almost certainly safe. Ditto for football. But other sports may be in peril as part of an athletics department that struggles to generate positive revenue—a common affliction across the NCAA landscape. Should Arizona enact sweeping cuts, it will be following a broader trend at the Division I level, where universities that have built reputations and alumni support on robust athletics have increasingly begun dropping certain programs—often those of the Olympic variety, such as swimming, track and field, and tennis.

Stephen Dittmore, dean of the College of Education and Health Sciences at Baldwin Wallace University, has studied the trends in college athletics. According to his analysis, Division I institutions are dropping athletic programs while Division III colleges are adding more sports teams. Stuck in the middle is Division II, the smallest of the three, which Dittmore finds relatively flat.

Finances remain the driving factor. While Division I institutions are cutting programs to save money, Division III colleges—which aren’t allowed to offer athletic scholarships—are adding sports in the hopes of boosting enrollment and bringing more tuition-paying students to campus.

“When I look at the profile of a campus that adds sports, it’s not the highly selective institutions that have really large endowments and a lot of tradition and history,” Dittmore said. “It’s more of the schools that fall outside of that group that have been the ones adding sports.”

Adding and Dropping Sports

When the COVID-19 pandemic hit the U.S. in early 2020, prompting lockdowns and shifting classes online at many institutions, it also threw the college athletics world into uncertainty. Shuttered campuses led to canceled or shortened sports seasons and significant revenue losses as stadiums went empty and universities and conferences missed out on lucrative broadcast deals.

As a result, many institutions slashed various sports. Coronavirus-related budget issues prompted institutions to drop 352 NCAA programs between March and November of 2020, according to an analysis by ESPN.

Since then, as economic challenges have continued, a handful of Division I institutions have made headlines for dropping multiple sports even after the pandemic eased. Late last year, Lindenwood University in Missouri announced it was cutting 10 athletic teams. And in January, Loyola Marymount University in California announced it was dropping six sports.

Some went further. St. Francis College in Brooklyn cut all athletic programs, citing enrollment and demographic challenges and the need for a bold “strategic realignment.”

The rationale for most institutions has been largely the same: to save money.

Looking at 20 years of U.S. Department of Education data from the 2002–3 school year to 2021–22, Dittmore found that Division I institutions have dropped an average of 0.23 sports per university. Meanwhile, their Division III counterparts added an average of two sports apiece during that time period.

Economics was also the driving factor for those additions.

“These are what we would call enrollment-driven institutions, where having students on campus is critical to the lifeblood of the campuses finances,” Dittmore said, noting that adding sports teams can be a recruiting draw by allowing students to pursue a passion central to their identity.

In that sense, he noted, athletics differs little from other extracurricular activities as a recruiting tool.

“I think universities are [adding sports] both as a way to grow enrollment, but then also as a way to give themselves a little bit of a competitive advantage as you look at this upcoming [demographic] cliff that everybody talks about with regard to college-bound students,” he said.

Enrollment Potential

Adding sports to boost enrollment isn’t always a winning strategy, according to recent analysis from Bryan Cook and Elise Colin of the Urban Institute, a nonpartisan research organization.

In a study of 325 Division III institutions that looked at data from 2005 to 2020, Cook and Colin found mixed results on enrollment for colleges that invested in athletics either by adding sports programs or hiring full-time coaches, which isn’t standard across Division III programs. In some cases, the strategy appears to have paid off significantly; Adrian College in Michigan, for example, has added 30 sports since 2005—and enrollment has doubled since then.

But the big picture is more complicated.

Of the 325 institutions Cook and Colin examined, 201 invested in athletics. Of those, enrollment increased at 91 institutions—less than half. At the other 110, enrollment remained stagnant or fell.

“It’s a mixed bag and I think there’s a lot of nuance to understanding how investment in sports would affect a particular school,” said Cook, Urban Institute’s director of higher education policy. He added that numerous factors must be considered, including the popularity of the sport within a college’s region and what it costs to add the program.

Among the 124 institutions that did not make additional investments in athletics, enrollment increased at 64 institutions and decreased at 60.

“It’s not this clear thing where if you didn’t add a sport or didn’t invest in your full-time coaches, you didn’t increase enrollment,” said Colin, a research analyst in the Urban Institute’s Center on Education Data and Policy. “Clearly they managed to increase their enrollment in other ways.”

While adding a sport or hiring a full-time coach may offer students at a Division III institution the opportunity to play at a collegiate level, in the absence of athletic scholarships, such moves do little to ease the affordability issues that often prevent students from pursuing a degree.

“Simply adding sports doesn’t negate cost barriers that might exist for students,” Cook said.

Some institutions that looked to athletics to ease enrollment woes have backslid further, even facing closure. In 2022, Fontbonne University in Missouri, for example, added sprint football, which requires players to weigh under 178 pounds. Last year, Fontbonne officials told Inside Higher Ed the university had recruited 45 students for its new team. Though not an officially sanctioned NCAA sport, officials saw the sprint football program as a way to boost enrollment; the growing popularity of the sport in recent years promised greater recruiting potential.

But this spring, Fontbonne announced it will close next year. Despite its efforts to boost enrollment through athletics, the university continued to struggle to attract students.

An Unclear Landscape Ahead

Though the coronavirus pandemic caused significant disruption to college athletics, it may pale in comparison to the seismic changes that the NCAA’s pending legal battles portend. Perhaps the most significant issue ahead is the unionization of college athletes, a topic that has swirled since Northwestern University’s football team attempted to organize in 2014.

While that effort failed, labor protections for college athletes have since gained momentum. Earlier this month the Dartmouth College men’s basketball team voted 13 to 2 to organize, marking a historic first. College officials, however, are resisting the move.

If college athletes are recognized as employees—which numerous elected officials oppose, particularly in the Republican party—it could usher in a paradigm shift, given the expectation of compensation.

Dittmore suspects that a requirement to pay athletes would prompt a retreat for colleges, with many in Division I likely to winnow programs down to 16, the minimum number the NCAA requires to maintain Division I status. He believes that’s especially true for the Division I programs already struggling.

“If, all of a sudden, athletic programs are paying athletes as employees, what is the incentive for them to go much beyond 16 if it means that they have to go into deficit budgets to do that?” Dittmore asked.

Uncertainty in Arizona

And then there’s Arizona.

Athletics at the university is both a point of pride, with the highly seeded Wildcats poised to make a run for the NCAA Men’s basketball title, and a matter of contention, given faculty outrage over how UA has propped up the athletics department even though it has consistently lost money. Likely cuts across academic units to make up for the $177 million shortfall have exacerbated faculty concerns about such subsidies.

But lately, Arizona seems to be changing its tune on athletic cuts.

In November, President Robbins promised faculty that all options were on the table. When UA hired new athletic director Desireé Reed-Francois last month, however, she told local reporters in an introductory press conference that the athletic department will not cut programs to save money. Instead, UA is making a strong push for more donor support.

Over the course of a few months, UA officials appears to have done an about-face on athletics.

Asked about potential athletic changes and when or why officials seemed to have walked back plans to consider certain sports for elimination, an Arizona spokesperson pointed Inside Higher Ed to the Reed-Francois press conference, in which Robbins and the new athletic director emphasized fundraising efforts.

But for now the community will be watching and waiting as the Wildcats tip off in Salt Lake City, hoping to punch their ticket home to the championship.