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Directors' Cup - A Minority View - Printable Version

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Re: Directors' Cup - A Minority View - Stymie - 04-11-2015

Mr. Mustard

You are in (at least) a minority of two.  Stanford has, and always will attract an incredible diversity of young human beings, with an amazing array of talents.  To try to quantify the collective accomplishments of those whose talents are in the very small segment of human capabilities called "athletics"is a folly.  All but an extremely few athletes who are Stanford people make their living  based on their campus avocation.  The vast majority of our athletes benefit from the" mens sana, sano corpore" meme as well as the "4 and 40" one.  That's enough for me.

Re: Directors' Cup - A Minority View - yvonne - 04-12-2015

Think Like a Jock: 6 Lessons Athletes Can Teach Business Leaders
http://online.stu.edu/lessons-athletes-can-teach-business-leaders/

Re: Directors' Cup - A Minority View - fullmetal - 04-12-2015

The univrrsity chips in about 15% to understand the rec/club sports programs.

Re: Directors' Cup - A Minority View - Farm93 - 04-12-2015

(04-11-2015, 05:09 PM)terry link Wrote:Of that amount, $10.6 million came from payments from the university in connection with running the P.E., intramural, recreation, and wellness programs.

Maybe somebody out there can shed some light on this issue?

Hold the phone.  Back when I was in school DAPER was very open with the fact that the golf course was a revenue producing asset that was critical to DAPER's success.  To imply it doesn't count is like implying the AD's endowment doesn't count. DAPER is responsible for maintaining that facility. The golf course is used by the golf teams and the X-Country teams.  So it has also been a critical facility for Stanford's competitive success in 4 sports.

The student use fees are harder to breakdown.  However, I took a course at Avery.  I knew many that took courses at the tennis facility.  Seems reasonable for those to fall in DAPER's budget.  My "instructor" was our women's swim coach at the time.  I doubted he was doing that for free, so that becomes part of his salary for working in DAPER.

Seems reasonable to include both really since the Stanford AD operates the facility and pays the coaches.

As I mentioned before the debt-free ownership of so many assets is really critical to Stanford's success.  Getting the ability to benefit from alums at the golf course and current students and summer campers into Maples, Avery and Taube have always been part of the formula.

Re: Directors' Cup - A Minority View - dabigv13 - 04-12-2015

DAPER sounds like some sort of Cold War anti-communist organization. Like it.

Re: Directors' Cup - A Minority View - yvonne - 04-12-2015

Department of Athletics, Physical Education, and Recreation

Re: Directors' Cup - A Minority View - terry - 04-12-2015

(04-12-2015, 09:52 AM)Farm93 link Wrote:[quote author=terry link=topic=12013.msg116556#msg116556 date=1428797361]
Of that amount, $10.6 million came from payments from the university in connection with running the P.E., intramural, recreation, and wellness programs.

Maybe somebody out there can shed some light on this issue?

Hold the phone.  Back when I was in school DAPER was very open with the fact that the golf course was a revenue producing asset that was critical to DAPER's success.  To imply it doesn't count is like implying the AD's endowment doesn't count. DAPER is responsible for maintaining that facility. The golf course is used by the golf teams and the X-Country teams.  So it has also been a critical facility for Stanford's competitive success in 4 sports.

The student use fees are harder to breakdown.  However, I took a course at Avery.  I knew many that took courses at the tennis facility.  Seems reasonable for those to fall in DAPER's budget.  My "instructor" was our women's swim coach at the time.  I doubted he was doing that for free, so that becomes part of his salary for working in DAPER.

Seems reasonable to include both really since the Stanford AD operates the facility and pays the coaches.

As I mentioned before the debt-free ownership of so many assets is really critical to Stanford's success.  Getting the ability to benefit from alums at the golf course and current students and summer campers into Maples, Avery and Taube have always been part of the formula.
[/quote]

I'm not saying anything "doesn't count."

I'm just trying to compare apples to apples.

As I understand it, the Equity in Athletics Disclosure figures are supposed to measure revenue and spending on intercollegiate athletics. Not intramurals, recreation, wellness, P.E. classes, or the operation of a golf course -- only intercollegiate athletics.

At Stanford, unlike some other schools, the Athletic Department's budget covers intramurals, recreation, P.E. classes, etc. The university pays the athletic department for those things. The Athletic Department also runs a golf course. If we're trying to figure out what the Athletic Department earns and spends on intercollegiate athletics, we need to back out those other items, because they are not related to intercollegiate athletics.

There's a big difference between the intercollegiate athletics budget reported in the Equity in Athletics Disclosure data and the amount reported in the link provided by 82lsju. Why?

Again, I'm not saying that money associated with recreation, P.E. classes, wellness, golf course, etc. "doesn't count." I'm just saying it's not part of the budget for intercollegiate athletics.

Re: Directors' Cup - A Minority View - Farm93 - 04-13-2015

I know you think the golf course doesn't count, but trust me the AD has relied on it for quite a while.  Seems like you want to just count activities that directly, and only, support intercollegiate athletics, but that ideal is flawed.

UTexas gets big money from their Texas Longhorns channel, same for BYU.  That's not really part of running non-profit intercollegiate athletics.  Yet the revenue UT gets from their TV deal is very real and is plowed into the AD's budget.

The golf course fees have gone directly to the AD budget for a long time.  DAPER is responsible for the golf course and the facility is used for NCAA competitions.  There are other schools with golf courses, and I can give you a quirky example.  Michigan has a golf course too.  I am sure they get greens fee revenue (for about 4 months a year), but they also use the course for parking at Michigan football games.  That parking revenue is rather massive since it is the best parking near the stadium.  That parking revenue should count, of course.  So if a school uses their golf course for football fan cars it counts, but if it uses it for the students' championship golf and X-country events it doesn't?  That would be odd.

Need another example? A lot of schools (ie. Texas, UCB) hold events at their football stadiums (weddings, receptions, etc.).  In many cases that money gets captured as AD revenue if the facility is on campus and operated by the AD.  A wedding at a stadium really has little to do with intercollegiate athletics.  Yet we all know UCB AD will happily bank that money if they can find alums willing to party up there in that press box with Bay Area views.  And really they should count it since the stadium, and all of its uses, support the efforts AD.  And how many Texas alums would hold weddings at the facility if it was just the site of an old library or dorm?

The list of odd exceptions could be rather endless.  If it helps fund the department responsible for athletics it should count.

The IM fees are a bit quirky, but it really is the same as mandatory student fees for D-1 athletics.  Facilities use fees vs Sports subsidies.  Might matter in some realm, but really they are still transfers from students to the AD that the school has permitted.  The AD probably spends very little to let the non-athletes play/train on the facilities.  They theoretically are using some facility for a fraction of the day (like Avery).  Those facilities would be there anyway, depreciating with or without the student use.  Supply a few lifeguards and collect big facility use fees, etc.  Should count if the AD relies upon those transfers to fund the machine.

In the end, Stanford spends $110 million on intercollegiate athletics.  Stanford enjoys a massive sports complex on campus that creates many financial and non-financial benefits.  Stanford also gets large AD gifts that do not fall into that annual budget.  And those resources (including some that other schools can't replicate) are major forces in Stanford's Directors' cup success.  It is all part of the not so secret sauce. 

Re: Directors' Cup - A Minority View - BostonCard - 04-13-2015

I think you are misreading CTCard's assertion.  He is just trying to reconcile two different sources of data.  One source looks at just intercollegiate revenues and expenses (and for the record, the Longhorn channel counts there since that revenue is tied with showing Texas intercollegiate events).  The other source looks at all DAPER revenue and expenses, understanding that DAPER includes not just intercollegiate athletics but also physical education classes, intramurals, club sports, and the recreational use of Stanford Athletics venues, such as the golf course.  Thus, revenue from the golf course not related to the Stanford golf team counts insofar as figuring out all of DAPER's budget, but it doesn't count if you are just trying to figure out DAPER's intercollegiate budget.

BC

Re: Directors' Cup - A Minority View - Farm93 - 04-13-2015

(04-13-2015, 02:44 PM)Boston Card link Wrote:I think you are misreading CTCard's assertion.  He is just trying to reconcile two different sources of data.  One source looks at just intercollegiate revenues and expenses (and for the record, the Longhorn channel counts there since that revenue is tied with showing Texas intercollegiate events).  The other source looks at all DAPER revenue and expenses, understanding that DAPER includes not just intercollegiate athletics but also physical education classes, intramurals, club sports, and the recreational use of Stanford Athletics venues, such as the golf course.  Thus, revenue from the golf course not related to the Stanford golf team counts insofar as figuring out all of DAPER's budget, but it doesn't count if you are just trying to figure out DAPER's intercollegiate budget.

BC
No, got it.  And still stand with my opinion.  It is actually informed by something I was told by in the early 90s while working for DAPER as a student.

At the time the golf course was a meaningful percentage of the DAPER revenue.  I was told, by people that knew, that the golf course was essential to the AD's financial success.  Someone with access to real numbers could check, but in the early 90s something like 20+% of DAPER's annual revenue came from the golf course.  It WAS a big part of the fuel, and highly profitable portion of the operation.  It is an unusual source of income that not every school can enjoy.  I certainly understand that view.  To therefore discount it as an unrelated asset and revenue stream misses the mark.  Stanford's Directors' cup success is directly tied to less than traditional, but very important, sources of revenue.  The golf course revenue has been an important part of Stanford's intercollegiate success for more than 30 years.

To ignore the atypical, or to say they don't count, pretty much dismisses Stanford's unique competitive advantages.  Each creates a unique set of revenue that allows DAPER to balance its budget.  DAPER is focused on all-sport excellence because it has always been AD that was more than just a football department plus administrative departments.

The golf course is specifically called out in the DAPER annual reports because of its strategic importance and meaningful contribution to the pie.  And really, as an asset it is probably more valuable than almost any other single facility in DAPER's portfolio.  DAPER couldn't sell the land, but imagine how much that land is worth!!

Re: Directors' Cup - A Minority View - BostonCard - 04-13-2015

I agree with most of what you are saying: the golf course brings in a lot of revenue, it is critical to AD's financial success, etc., and should not be discounted.  But that doesn't make it an intercollegiate source of revenue (and saying that it doesn't qualify as this type or revenue doesn't discount its importance).  It can be an important source of revenue, it can fund intercollegiate activities, but it is not an intercollegiate source of revenue, the way that receipts from the Pac-12 networks are.

Bottom line, separating it out doesn't "discount" it or make it less important.  It just means that it isn't an intercollegiate athletics revenue source the way gate receipts or TV money, or conference bowl money is.

BC

Re: Directors' Cup - A Minority View - Farm93 - 04-13-2015

BC,

It is accounting.  But let's take the opposite view for a second.

In the coming years UCB's "Intercollegiate Expenses" will skyrocket.  They will likely soar to become #1 in the Pac-12 on intercollegiate spending.  Why?  Because the debt payments on their excessive fault-line renovations will be part of their annual budget.  Now, we can go back and forth about whether a stadium's debt payments should be included, does that mean that historic renovation excesses should be included?  Does that really count? 

I think one could argue that it is far more important to understand what a school is spending on the students than where the money is coming from.  The Stanford AD has an operating budget of $110 million.  I can assure you the incoming revenue from the golf course is not matching expenses 1 for 1.  The VAST majority of the golf course revenue, an asset like the endowment, or the stadium, or the parking around the stadium, will go directly to funding the operations of intercollegiate athletics.  In fact, more of the golf revenue drops cleanly to the bottom line than a lot of other traditional sources we likely would agree should count (concessions, parking, MBB gate, WBB gate, etc.)

If it feels better for some to say that is not "real" money then OK I guess.  It may not be growing exponentially like TV revenue, but if I am a worker in the AD it is just as much a part of the budget as the MBB gate.  Just a touch more reliable these days.

Same goes for IM fees.  Some institutions have to rent parks for cross country meets or softball fields.  They can't capture IM revenue because they don't have fields to spare. Here too, the IM money DAPER gets is cleanly falling directly to support DAPER.  There are very, very few costs associated with capturing that IM revenue, and that revenue becomes available because of one of the most treasured assets of all, land.

I just struggle to understand how endowment assets are cool and should count, but land (golf courses) and land (fields) and facilities (stadiums), all assets too, should not count.  THAT would seem to be odd accounting to include the revenue from one set of assets (investments) but not the other (land) in this notion of real intercollegiate revenue.

Re: Directors' Cup - A Minority View - terry - 04-13-2015

Farm93 --

There are two different issues here.

One is the total athletic department budget. I'm not concerned about that at the moment.

The other is the budget for intercollegiate athletics, which is a subset of the total athletic department budget. That's what I'm trying to figure out here. Revenue and expenses relating to P.E. classes, intramurals, recreation, and wellness are not related to intercollegiate athletics. These items don't belong in the intercollegiate athletics budget.

Likewise, revenue and expenses relating to the golf course are not related to intercollegiate athletics (at least, not for the most part -- there are some intercollegiate events on the golf course). So, with a few exceptions, golf course revenues and expenses don't belong in the intercollegiate athletics budget.

I think it should be pretty easy for all of us to agree on that. It's just basic accounting.

If the golf course makes a profit, the athletic department may choose to use that non-intercollegiate revenue source to subsidize intercollegiate athletics. That money essentially would be a contribution from the university to subsidize the intercollegiate program. But that doesn't mean that all of the golf course's revenues and expenses belong in the intercollegiate athletics budget. That would be bad accounting.

The document linked by 82lsju (http://gostanford.com/fls/30600/pdf/giving/12-13-annual-report.pdf?DB_OEM_ID=30600) shows a total athletic department revenue budget of $97 million in 2012-13. That appears to include everything that flows through the athletic department's books -- not just revenues from the intercollegiate athletic program, but all revenues. Some of these revenues clearly are not related to intercollegiate athletics. About $10.6 million relates to P.E., recreation, and wellness, none of which belongs in the intercollegiate athletics budget. Another $8.3 million relates to the golf course and equestrian center. Most of this money, if not all of it, does not come from intercollegiate athletics. So, revenues from intercollegiate athletics would appear to have been about $78 million in that year. A portion of the golf course revenue may have been used to subsidize intercollegiate athletics. This document doesn't tell us. Using golf course profits as a subsidy for intercollegiate athletics might allow the intercollegiate athletics programs to increase their budget by a few million. But still, it would appear that the intercollegiate athletics budget would have been in the $80 million range for that year.

Those numbers don't come close to the $110 million listed in the Equity in Athletics Disclosure figures for 2013-14. That $110 million is supposed to represent the budget for intercollegiate athletics only. So it should not have anything in it relating to P.E. classes, recreation, or wellness, and it shouldn't have most of the golf course's operations. Why is there such a big difference between this $110 million and the $80 million that we get from the document linked above? Does the $110 million have some capital improvements in it? Did revenues from intercollegiate athletics go up $30 million in one year? I don't know. Maybe somebody else does. Until someone can explain that discrepancy, I am skeptical of the $110 million figure.