Costs of College Football

If you haven’t checked out Forbes study of the most valuable college football teams and the teams that are the best value for the money, you really should. Like right now.

It’s no surprise the Texas Longhorns football program is the most valuable team in all of college football. With this Forbes study and the recent resignation of head coach Mack Brown, it seems like much of the focus of this dead period between the regular season and bowl season has been on the Longhorns. Just check out ESPN’s Big XII blog, which could have changed its name to the Mack Brown blog for the last 2 weeks.

The Longhorns’ Big XII nemesis Kansas State is ranked as the 2nd most cost-effective team in college football after finishing first the previous 2 years. Whereas Texas is valued at $139 million and received $109 million in revenue from their football team alone last year, the Wildcats efficient athletic department has spent a mere $1.5 million per win over the last 3 seasons. Recently, the small-budget Wildcats have been the Tampa Bay Rays of college football. Michael Lewis could write a book called Moneyball in Manhattan.

Although I could write an entire post on how K-State has had the upper hand in the rivalry with Texas*, I think the more interesting story is the incredible contrast in the two school’s athletic budgets, most notably their football budgets. K-State is definitely the small-market Kansas City Royals to the Yankees-esque Texas Longhorns. According to data from the U.S. Department of Education on the 2012-2013 school year, Kansas State had a total undergraduate enrollment of 17,634 compared to the University of Texas at Austin’s enrollment of 36,724, more than twice as many undergrads.

*Maybe another time!

Texas has 746 men and women student athletes across all varsity sports, while K-State has 572. That seems reasonable compared to the size of undergraduate enrollment at each university, but there is a stark contrast in the total athletic budget for each school. UT has a total budget of $138 million and K-State’s is much less than half at $58 million.  Although K-State spends $11 million less than Texas on football, K-State spends a much higher portion of its athletic budget on football, meaning the teams affected by the small budget are the non-revenue producing sports. Texas spends almost exactly 20% of its budget on football while K-State spends over 28% of its budget on football. It’s interesting to see that because of the number of student athletes participating in football compared to men’s basketball, the game-day expenses are spread among a wider pool. Texas spends over $130,000 more per participant on its basketball program compared to the football team ($174,666 in basketball to $41,484 in football).

Texas Total Expenses K-State Total Expenses
Football $27,675,403 Football $16,421,248
Grand Total Expenses $138,205,604 Grand Total Expenses $58,118,494
Texas Total Revenues K-State Total Revenues
Football $109,400,688 Football $30,976,071
Grand Total for all Teams $165,691,486 Grand Total for all Teams $69,250,204

This is where programs like K-State have to be efficient with their spending due to the razor-thin margin of error, not only for their football team, but for the entire athletic department. According to Forbes study, over the last 3 seasons the Wildcats have spent $1.5 million per win, with first place Cincinnati Bearcats spending $1.4 million per win. The very last place in cost-efficiency in college football is the University of Kansas Jayhawks, who have spent $8 million per win the last 3 seasons. To contrast, Texas has spent $3.4 million per win the last 3 seasons. K-State Athletic Director John Currie has definitely earned his raise and extension for overseeing Big XII titles in football, men’s basketball, and baseball during the last school year with such low expenses.

Revenue is where the Longhorns clearly distinguish themselves as the big dog in the NCAA. The total revenue for the entire department is nearly $100 million more than K-State revenue. The football program at Texas earns more from ticket sales alone ($34.5 million) than K-State football earns from everything ($30.9 million). According to Forbes, the majority of the remaining revenue for Longhorn football came from contributions ($30 million), royalties and sponsorships ($26 million) and distributions from the NCAA and Big 12 ($15 million).

The Longhorns have a pretty healthy bottom line. Their net profit from football alone is $82 million. K-State’s net profit from football is $14.5 million. These profits benefit the rest of the athletic programs by covering the deficits of some of the other programs at each university. It is interesting to see the non football and basketball programs at K-State earn a total of $469,808 in revenue, which is 22 times less than the same programs at Texas earn at $10.4 million! It is a wonder small-budget programs like Kansas State are able to compete against financial behemoths such as Texas. Such is the state of economics in college sports, and I haven’t even began to discuss paying college athletes.

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