Critics Of Student Fee Based Athletic Subsidies Miss The Point

November 25th, 2015 | by Karen Gross
Critics Of Student Fee Based Athletic Subsidies Miss The Point
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Athletic Subsidies

Recently, the Chronicle of Higher Education and the Huffington Post (the Team) teamed up to study and write about the enormous dollars from student fees that are used as DI athletic subsidies over the past five years at public universities.  The Huff Po/Chronicle pieces – along with other responsive articles – are critical of the subsidization of collegiate athletics, suggesting the costs are not worth the benefits.  In a nutshell, the argument goes, undergraduate students, many of whom are at institutions enrolling sizable numbers of Pell eligible students, are bankrolling their institutions’ sports programs that are not revenue-generating. One commentator stated, “…[t]his is morally wrong.”

I beg to differ on many fronts and on many levels – enough to write a book even.  But, here are three key arguments to consider before following the anti-athletics parade due to use of student athletic fees.  And, a shout out to the Knight Commission that is reflecting on the overall issue of costs in athletics, a worthy and much needed inquiry.  For the record, costs and subsidies are not synonymous terms; subsidies involve how costs are met, not the size of the costs per se (although that can affect the size of the subsidies) nor the “value” of expenditures for massive and elaborate facilities, coaches, equipment and travel.

Athletic Subsidies

1) The recent data collected and the accompanying articles published by the Team treat subsidies in athletics in a vacuum.  Just for starters, there are many fees that students pay, all of which serve to subsidize their collegiate experience.  Think about it like the fees we pay to most airlines for baggage, premier seats, early boarding, and overweight luggage; these are all revenue generating ways to subsidize the airlines’ bottom lines.  

In academia, fees have been proliferating, particularly in an environment where tuition growth has been limited due to both State decision-making and public perception of the “high” and rising costs of tuition. And, make no mistake about these student fees: they are a backdoor way to generate revenue.  Call them alternative revenue streams.  

There are, to name a few, IT fees, orientation fees, graduation fees, student activities fees and course fees.  Some of these do not have a direct benefit to all the paying students (and the payment is not optional.)  Some commuter students or computer savvy students don’t use the campus technology services or available cable.  Some students refuse to attend both orientation and graduation, and the level of campus participation is varied.

In short, student athletic fees are not unique. And, if we want to question them, we need to question the whole model for financing higher education in the US.  My point is that the moral outrage over athletic subsidies is misplaced, hyperbolic even.

Athletic Subsidies via croplife.com

2) The articles written seem to have an underlying current suggesting that the very existence of subsidies is offensive.  That ignores the myriad of subsidies in and outside of academia.  Indeed, subsidies take many forms and perform many different functions in our society.  We may dislike some of the subsidies and like others but it makes zero sense to object to the very notion of subsidies.

Consider this example.  Many educational institutions provide educational benefits for their employees.  In some instances, these benefits pay all or part of the undergraduate tuition of the child at any or at particular colleges/university across the nation.  But, not all employees have college-aged children and will never use this benefit; perhaps the employee arrived on campus when their children were grown or perhaps they have no children now or ever.  Surely it is clear that those who do not have college aged or college bound students “subsidize” this educational benefit.

Consider this subsidy outside the educational realm: farming subsidies, which take many forms and affect different farmers and differing products through differing methods.  For example, depending on the crop, we (as in the federal government meaning all of us as taxpayers) subsidize farming of some products to stabilize prices or create availability; we subsidize other farmers if they do not farm a particular product, to control the market and prevent surplus and price declines.

My point here is that subsidies exist across our entire economy, whether we like it or not.  So, athletic subsidies paid by students, are not an anomaly and need to be evaluated not as a shocking financial oddity that adversely affects low-income students.

Athletic Subsidies via uchicago.edu

3) The Team’s work fails to think through how colleges and universities measure “value” and “necessity.”  Were we to do a cost/benefit analysis of many pieces of the academy, we would see with clarity that some academic departments cannot self-support; they do not have enough students to pay for the departmental costs.  Does that mean those subject areas should be eliminated or the faculty told to increase enrollment or they will be shut down?  And, yes, this approach has taken hold at some universities.

Consider foreign language departments. Consider philosophy departments.  Consider studio art departments.  Consider religious studies departments.  At many institutions, these departments run at a deficit and are “bankrolled” by other departments that are profit centers with an abundance or over-abundance of students. In an excellent essay appearing in the Chronicle, Professor Paul Walker notes the importance of the intangible benefits of some aspects of the university (in his case, the Philosophy Department), even if they are not moneymakers.  Athletics, he notes, may well be “worth it” and its value needs to be considered in non-economic terms, just as we hope will happen with academic departments that aren’t independent profit centers.

He’s right.  We shouldn’t look at everything within the academy as a required independent cost/profit center and discard any department that cannot self-sustain.  Think about it: should we do away with mental health counseling offered for free on many campuses? We need to look at the overall needs of institutions and reflect on priorities, values, benefits – both tangible and intangible.  In businesses, we recognize the value and importance of “loss leaders,” even recognizing the difficulty of the cost/benefit calculus. Why can’t we do that in the context of educational institutions?




Bottom line: subsidies are not bad, per se, despite the lingering tone of the Team’s work on athletic subsidies through student fees. To be sure, the profit/loss numbers for all units within an educational institution are worth calculating in considering course offerings, new hires, research opportunities, among other items; data informed decision-making is wise.

For me, the key lesson here is the importance of context.  Savaging student athletic fees should not be done without a vastly more nuanced understanding of both subsidies and college/university finances.  Reasonable people can differ on the value of collegiate athletics and that is a worthy conversation.  But, that conversation has to be informed by vastly more than the calculation of subsidization levels.  The work of the Team is the beginning and not the end of this essential and important question: what are the values of collegiate athletics?  Now, that’s a conversation well worth having.

About Karen Gross
Karen Gross is the former President of Southern Vermont College, an NCAA DIII institution fielding 13 teams. She was the president of the college's Athletic Conference, the NECC. She also served on the NCAA DIII Presidents' Advisory Council. A lawyer by training, she represented an NFL quarterback (decades ago) and is a serious professional and college sports fan. She currently is senior counsel to a crisis management firm in DC where she specializes in education. A Red Sox fan, she knows a lot about losing and winning. Her son, now a professor, is a former NCAA Division I athlete.

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