College Football Is a Money Pit, and One School Has Had Enough

(Bloomberg) -- Jacksonville University surprised athletes, alumni and fans this week when it announced it was discontinuing its Division I football team, which had been competing for more than two decades.

Administrators at the Florida school say the decision was financial. Operating a football team is expensive, and only getting pricier. More importantly, the investment wasn't worth the benefits that are typically held up to justify the money-losing endeavor.

The school's choice was notable for how rare it is. Despite skyrocketing costs for coaches and facilities, dwindling attendance and limited returns, colleges around the country remain addicted to football. For many, the dreams of gridiron glory and the corresponding financial boost -- however unattainable -- is enough to keep pouring in cash.

“We undertook a strategic review of the athletic program over the past 12 to 15 months,” Jacksonville Athletic Director Alex Ricker-Gilbert said. “The cost to run the program outweighed the benefits to the entire university.”

In broad terms, the Jacksonville Dolphins' football program wasn't wildly expensive. It competed in the Football Championship Subdivision, or FCS, the second tier of Division I football that includes schools like Princeton, North Dakota State, Georgetown and Eastern Washington. It's a collection of programs with a wide range of investments in football, all a far cry from the powerhouse conferences like the Big Ten or SEC.

‘Sizable Chunk'

Jacksonville's football operations were about $1.3 million a year, according to numbers submitted to the U.S. Department of Education, plus additional costs for non-coaching personnel and facilities. School President Tim Cost declined to comment on the exact total, but said the university was spending “multimillions” on football annually.

“You've got a sizable chunk of the entire athletic department that is being consumed by football,” Cost said. “The students are interested, the students are supportive, but college football at Jacksonville University is not the one single lone rallying point for the school.”

There's no public database of FCS financial information, but in 2017, the NCAA reported that 98% of FCS football programs -- all but three -- lost money, with the median deficit at $2.4 million. In the past decade, average attendance at FCS games has fallen 11%.

As schools lose millions on football, they balance their athletic budgets with money from the academic side of the institution, or directly from the students via tuition fees.

Jacksonville's economics were a little different. The university was part of the Pioneer Football League, a conference comprised of schools that don't give football scholarships. While they save on that cost, it stresses the budget in other ways. The Dolphins' conference schedule might include road games at San Diego, Indianapolis, and Poughkeepsie, New York. The team was 3-9 this season.

That said, nonscholarship football is considered by many to be an easier financial proposition than offering 63 football scholarships, according to Russell Wright, managing director of Collegiate Consulting. Wright has worked with a number of schools as they considered adding, or dropping, football.

Tough Economics

“At the low level of FCS-scholarship football, I don't know how some of these programs are surviving,” Wright said. “There is absolutely no revenue, and the impact on the budget is substantial.”

And yet, the number of programs is increasing, not decreasing. In the past decade, the number of Division I football teams has grown by 16, to 254. In FCS, it's jumped to 125 from 118, despite a dozen teams making the move up to college football's top tier.

The reasoning often goes beyond money. Administrators at those schools preach about the national recognition of the sport, and the ways it helps engage former students and potential donors. That was the argument made when Kennesaw State University announced in 2013 that it was adding football. Two years earlier, Houston Baptist University announced its new FCS team, part of a plan to quintuple the student population.

Decisions to scale back football programs have been met with anger. When the University of Idaho announced in 2016 that its team would drop to FCS, the president's car was vandalized. In 2014, the University of Alabama at Birmingham's plan to eliminate football was met with so much anger -- and fundraising -- that the team returned to the field in 2017.

Thinking Ahead

Wary of negative backlash, Cost said Jacksonville took careful steps to make sure the decision and its aftermath were thoughtfully approached. The school said it would offer full tuition scholarships for any football player who chose to stay through graduation. It is also honoring the employment agreements for all football coaches and assisting in their search for new jobs.

Some of the money saved will go back to the institution, while some will be used to benefit the school's other 17 teams. The university has about 3,000 undergraduates, with more than 500 student athletes.

In the past year, Jacksonville opened a new $1.8 million lacrosse center, announced plans to upgrade its baseball stadium and started building a new $8 million basketball practice facility.

Just a few hours after the announcement went out, Cost was asked if it was an admission that Jacksonville's football program or its nearly 100 players had failed.

“I said it would be a failure if we blinked and shied away from making hard decisions like this one,” Cost said. “It has social value here on campus brought to us by the young men, not so much by the games on Saturday.”

To contact the reporter on this story: Eben Novy-Williams in New York at enovywilliam@bloomberg.net

To contact the editor responsible for this story: Nick Turner at nturner7@bloomberg.net

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