Bulldog Bling: Football is a $100 million business in Athens.
The Georgia Bulldogs' colors, as everyone knows, are red and black. But they might as well be green.
The University of Georgia Athletic Association's budget is a whopping $100 million, with about 85 percent of that revenue generated by football, according to Frank Crumley, executive associate athletic director for finance and business. With six or seven home games drawing 100,000 people or more to Athens, tack on millions more in visitor spending. "The hotels are full," Athens Area Chamber of Commerce President Doc Eldridge says. "That means the restaurants are busy. The convenience stores, the package stores are busy. Unfortunately, the bail bondsmen are busy."
So servers, bartenders, business owners, stadium vendors, taxi drivers, coaches, even anyone who owns a parking lot are all making money on game day.
Everyone but the players, that is.
College football has grown explosively over the decades. It's the most popular sport in the South and the third-most popular in the nation, behind pro football and baseball, according to a 2013 Harris poll. As live sports—about the only programming you can't DVR or watch online—skyrockets in value to advertisers, so have television contracts. For instance, the NCAA will make $470 million from the new four-team playoff, as opposed to $180 million from the Bowl Championship Series. The average athletic department's budget in the Power Five conferences—SEC, ACC, Big Ten, Big 12 and Pac-12—has doubled in the past decade. The new bowl structure will bring UGA $5.8 million this season, Crumley said, more than double last year's haul.
UGA economist Jeff Humphreys did a study last year that estimated the University of Georgia’s total impact on the Athens economy at $2.2 billion—a figure that doesn't include the Athletic Association, a nonprofit entity separate from the university. Humphreys did, however, study football's economic impact in the late 1990s—when the UGA athletics budget was $30 million, less than a third of what it is today. "At that time, football spectators spent $11.4 million in Athens," he says. But "those old numbers don't really mean much," he says. "Those programs have grown a lot since '97–98."
The Athens Convention and Visitor's Bureau has been updating Humphreys’ 1999 study based on inflation and seats added to Sanford Stadium over the years (it now has a capacity of 92,000). "As I see it, football is presently generating around $21–22 million in [annual] direct spending," CVB Executive Director Chuck Jones says. "The total economic impact, which would include direct and indirect spending, would be even larger." And all those people are spending all that money to watch 20-year-olds who might not have a cent to their name.
Because they're forbidden from giving players anything other than tuition and room and board, major sports schools have gone on spending sprees in other areas, paying top coaches exorbitant salaries and building luxurious amenities like the University of Oregon's $68 million marble-walled, leather-chaired, Nike-funded practice facility that makes Butts-Mehre look like the Spilledge house. UGA's latest effort to keep up with the Joneses (or the 'Bamas, as the case may be) is an indoor practice field currently under discussion.
In 26 states, including Georgia, a college football coach is the highest-paid state employee. After getting a $400,000 raise last year, UGA head coach Mark Richt earns $3.2 million—five times the salary of his boss's boss, President Jere Morehead. Offensive Coordinator Mike Bobo makes $575,000, and position coaches are paid $230,000–$300,000. Just a fraction of coaches' salaries are funded with tax and tuition money; the rest comes from sports revenue like alumni donations, ticket sales, memorabilia and TV contracts.
But Richt is only in the middle of the pack among SEC football coaches. Alabama's Nick Saban, the highest paid coach in the conference, makes $5.3 million a year.
"Mark Richt can make millions, but Aaron Murray is limited to almost the full cost of attendance, not even the full cost of attendance," says Nathaniel Grow, a Terry College of Business professor who teaches classes on the economics of sports.
That might be changing soon, and for many student athletes, it's about time.
After Shabazz Napier led UConn to the NCAA basketball championship in April, he told Fox Sports "there are hungry nights that I go to bed and I'm starving." Ole Miss quarterback Bo Wallace agrees. "A lot of guys go to bed hungry at night. That's real," he said at an SEC Media Days session in June.
"The problem arises when you want to do things other than [buy food]—if you want to buy clothes, if you want to buy shoes, if you want to go out for a weekend, go to Six Flags, take your girlfriend there," says UGA flanker Chris Conley. "That stuff is costly, and unfortunately, right now athletics alone does not allow you enough money to do that, so when you do step out and do something else, that money does come out of your food money. So it is possible for that [going hungry] to happen, but it's because you're using your food money for something other than food.
"It does come down to, a lot of weekends, am I going to spend my food money to go out and do something with the guys, or am I going to just stay home?" Conley says. "A lot of times, I end up staying home, because otherwise I won't have any money for buying groceries or things like that. But I think there should be something—whether it's a stipend or full cost of attendance, just something for those players who fall through the cracks to have a way to do things college students do."
Between classes, practices, working out and traveling to away games, it'd be virtually impossible for a player to hold down a job from August through January. Some players do work in the summer, Conley says, but even then it affects their preparation. "We had one of our guys take a job at a car dealership this summer, and he was rarely here, because in football, you spend a ton of time preparing and practicing and lifting, so when you dedicate time to something else, it changes the dynamic of the way you can be here," he says.
In addition to their scholarship, room and board, players get a $75 weekly check if they choose a five-day, rather than a seven-day, meal plan. Four players were arrested during the off-season for double-dipping—cashing their checks online, then again at a convenience store.
"I think that temptation is always going to be there, because guys, if they're really not thankful for what they have, they're always going to want more and more and more and more," quarterback Hutson Mason says. "I get the same amount of money, and I don't come from a family that really has much money at all. I think it really comes down to guys making good decisions."
Paid to Play
Ed O'Bannon—a star forward for UCLA's 1995 national champion basketball team whose pro career was cut short by knee injuries—sued the NCAA five years ago after seeing himself in a video game for which he wasn't compensated. A federal judge ruled in his favor Aug. 8, and starting in 2015, incoming freshmen football and men's basketball players will receive $5,000 a year in a trust until graduation for their share of NCAA TV and licensing revenue.
While the NCAA fought O'Bannon's lawsuit, many major football schools would rather just go ahead and pay players, or at least provide a stipend to cover the full cost of attendance (including expenses like books and gas, in addition to tuition, room and board). The rift with smaller, lower-revenue universities led the Power Five conferences to threaten to break away from the NCAA. Earlier this month, university presidents (including Morehead) voted to allow the Power Five a degree of autonomy, paving the way for big-money schools to start covering the full cost of attendance. They can also guarantee scholarships for four years—they're year-to-year now—and insure pro prospects' future earnings against injury.
Richt—who estimates that UGA spends $250,000 on each football player per year when travel, training and medical care are taken into account—was quoted in the Athens Banner-Herald saying that he's in favor of a $2,000 stipend. "I think it's going to be a lot of positives for the student athlete," he told a booster club earlier this month. "Everybody is saying that's the driving force, or at least one of the big driving forces of being able to do that."
The decision, though, is not up to Richt, and it may not come anytime soon. "The mechanics of figuring out what is meant by 'cost of attendance' and how it would be calculated is likely to take some time to decide," university spokesman Tom Jackson said. He and sports communications director Claude Felton referred questions to the SEC home office in Birmingham, AL, but the SEC did not respond to Flagpole's request for comment.
SEC schools can afford to give more to players. Football at UGA generates about a $50 million "profit," which goes toward subsidizing other, less lucrative sports. Overall, the athletic association about breaks even. Unlike at many universities, it doesn't lose money and doesn't get a subsidy from the academic side; in fact, it's spending $4 million this year on academic and need-based scholarships and endowed professorships. UGA is just 15th in athletics revenue nationwide, paling in comparison to No. 1 Texas, which collected $165 million last year and netted $24 million from all sports combined.
The $5,000 mandated by the O'Bannon ruling and $2,000 stipends for the 85 students on football scholarships and 13 men's basketball players would cost UGA about $700,000—change Richt might find in the back of his Ford pickup. "The SEC has enough money coming in that they can cover that rather comfortably," Grow says.
While the economics of college football are rapidly changing, a number of questions remain unresolved:
• The National Labor Relations Board ruled earlier this year that football players at private universities like Northwestern can unionize. State employees are forbidden from joining unions in Georgia, but if the NLRB ruling were ever extended to public universities, Grow speculated that the state legislature might change the law rather than see the Bulldogs lose recruits to union schools.
• The NCAA fought Northwestern players in the NLRB case, but like the NFL might eventually decide that allowing players to unionize and collectively bargain might be easier than dealing with a flood of lawsuits, Grow says.
• Either the courts or Congress may have to step in to decide whether to increase benefits for athletes in non-revenue-generating sports to match those received by football and men's basketball players. The O'Bannon case also opens up the question of whether those benefits violate Title IX, the federal law that mandates equality between men's and women's sports.
• Would fans and fellow students look at players the same way, knowing they're being paid?
• A class-action lawsuit filed in March by labor lawyer Jeffrey Kessler goes even further than O'Bannon, targeting the NCAA's antitrust exemption. Kessler wants the court to lift any limits on what universities can offer recruits, essentially turning college football into a pro league.
"The only thing I'd bet a lot of money on is college football looking a lot different 10 years from now," Grow says. "I don't know what that will be, but it won't be the status quo."