1. Unit 4: Team /School Financials
Economics of Sports
Unit 4: Team /School Financials

2. Table 4-1 Operating Expenses for the Seattle Mariners 1993 to 1998 ($Thousands) (slide 1 of 2)
1994
1995
1996
1997
1998
Baseball Operations
Player Compensation
$32,612
$20,918
$29,732
$39,313
$43,815
$52,392
Team Operations
$5,200
$3,825
$5,219
$4,530
$5,353
$6,281
Scouting/Player Development
$6,458
$5,205
$6,030
$6,375
$7,017
$7,606
Other Operating Expenses
Kingdome Operations
$1,898
$1,388
$1,864
$2,777
$3,383
$3,888
Marketing, Publicity, Ticket operations
$3,186
$2,663
$2,819
$4,239
$4,859
$5,990
General and Administrative
$5,501
$4,798
$5,385
$6,765
$7,395
$7,430
Net Int. and Other Expenses
$411
$178
$1,324
$1,274
$1,197
$1,230
King County Settlement*
-$4,204
ML Revenue Sharing Agreement**
$613
$3,364
$3,417
Total Operating Expenses
$55,266
$34,771
$52,373
$65,886
$76,383
$88,234

3. Table 4-1 Operating Expenses for the Seattle Mariners 1993 to 1998 ($Thousands) (slide 2 of 2)
Other Expenses
Signing Bonuses
$4,540
$2,049
$5,019
$5,164
$5,025
$3,572
Depreciation and Amortization***
$9,237
$6,176
Total Expenses
$59,806
$36,820
$57,392
$71,050
$90,645
$97,982
*One-time settlement in a political agreement between the team and King County.
**The so-called “luxury tax” that shares revenues among MLB owners
***Only reported for 1997 and 1998.

4. Table 4-2 Fixed and Variable Costs for the Seattle Mariners 1993 to 1998 ($Thousands) (slide 1 of 2)
1994
1995
1996
1997
1998
Short-Run Fixed Costs
Player Compensation
$32,612
$20,918
$29,732
$39,313
$43,815
$52,392
Signing Bonuses
$4,540
$2,049
$5,019
$5,164
$5,025
$3,572
Revenue Sharing Agreement*
$613
$3,364
$3,417
Net Int. and Other Expenses
$411
$178
$1,324
$1,274
$1,197
$1,230
Depreciation and Amortization**
$9,237
$6,176
Short-Run Fixed Costs Total
$37,563
$23,145
$36,075
$46,364
$62,638
$66,787
Short-Run Variable Costs
Marketing, Publicity, Ticket operations
$3,186
$2,663
$2,819
$4,239
$4,859
$5,990
Scouting/Player Development
$6,458
$5,205
$6,030
$6,375
$7,017
$7,606
Team Operations
$5,200
$3,825
$5,219
$4,530
$5,353
$6,281
Kingdome Operations
$1,898
$1,388
$1,864
$2,777
$3,383
$3,888
Short-Run Variable Costs Total
$16,742
$13,081
$15,932
$17,921
$20,612
$23,765

5. Table 4-2 Fixed and Variable Costs for the Seattle Mariners 1993 to 1998 ($Thousands) (slide 2 of 2)
Mixed Category
General and Administrative
$5,501
$4,798
$5,385
$6,765
$7,395
$7,430
Short-Run Total Costs
$59,806
$41,024
$57,392
$71,050
$90,645
$97,982
*Pooled sharing began in 1996.
**Only reported in 1997 and 1998.
Source: Adapted from Table 4-1

6. Table 4-8 Seattle Supersonics Annual Operations Statements, through ($2009) (slide 1 of 3)
Revenues
Ticket Revenue
$6,322,893
$32,734,483
$32,642,784
$30,688,944
$31,744,548
Playoff Revenue $0
$2,518,973
$134,833
$9,039,957
National Broadcast Revenue
$4,192,764
$32,940,139
$27,953,885
$27,983,980
$27,665,711
Local Broadcast and Sponsor Revenue
$3,353,843
$20,480,897
$19,646,688
$18,915,958
$20,234,546
Suite Revenue
$1,013,643
$2,107,358
$1,861,992
$2,023,807
$1,489,960
Equity in Earnings of NBA Parnerships
$683,694
$2,290,352
$2,816,976
$1,532,441
$2,691,844
Luxury Tax Revenue
$10,428,860
$9,739,090
NBA League-Wide Revenue Share
$625,147
$772,806
$2,119,732
$14,500,657
$1,911,906
Merchandise Sale
$268,374
$1,287,688
$1,421,044
$1,484,932
$2,435,027
Concession Revenue
$804,520
$1,144,605
$1,597,964
$2,016,136
Other Revenue
$210,523
$121,771
$703,805
$653,811
$514,283
Total
$16,670,881
$96,058,987
$100,740,372
$109,256,415
$99,743,918

7. Table 4-8 Seattle Supersonics Annual Operations Statements, through ($2009) (slide 2 of 3)
Costs and Expenses
Team and Game Expenses, Net
$17,722,927
$68,529,341
$78,267,947
$77,547,645
$81,241,211
Depreciation and Amortization
$29,041,833
$48,330,013
$25,933,716
$17,882,653
$12,293,206
General and Administrative
$7,740,733
$17,639,447
$18,920,022
$16,541,795
$14,269,289
Local Broadcast and Sponsor Expenses
$2,792,008
$12,029,261
$12,055,111
$12,441,237
$4,722,828
Ticket Sales and Operating Expenses
$1,169,141
$3,796,714
$4,857,162
$5,168,755
$6,737,187
Arena Expenses
$841,111
$1,422,170
$1,440,009
$1,468,050
$1,483,463
Community and Public Relations
$588,580
$1,407,985
$1,223,913
$971,472
$1,372,566
Playoff Expenses $0
$1,582,423
$26,442
$193,665
$6,330,722
Cost of Merchandise Sales
$547,183
$640,763
$768,251
$886,096
$1,291,849
Other Expenses
$871,679
$418,300
$515,970
$425,653
$560,146
Total
$61,315,195
$155,796,416
$144,008,543
$133,527,020
$130,302,465

8. Table 4-8 Seattle Supersonics Annual Operations Statements, through ($2009) (slide 3 of 3)
Loss from Operations
-$44,644,314
-$59,737,429
-$43,268,170
-$24,270,605
-$30,558,547
Gain (Loss) On Sale of Asset $0
-$785
-$6,960
$17,018
Gain on Interest Rate Swap
$301,298
$769,773
Interest Expense, Net
-$2,855,613
-$3,368,758
-$3,346,491
-$3,655,314
-$3,292,466
Net Loss
-$47,499,927
-$63,106,187
-$46,615,446
-$27,631,580
-$33,064,223
Notes: Schultz took formal financial control of the team on December 15, The purchase price as $200 million. The team fiscal year reportedly ended on September 30.

9. College Sports
2011 College Athletic Depts P&L

10. Table 13-1 Revenues and Expenses of FBS Athletic Departments (2009 dollars) (slide 1 of 2)
Year
Average Total Revenue a
Average Total Expenditures
Average Net
Percent Showing Profit
Maximum Total Revenue
Total Revenue RatioB
Maximum Total Expenditures
Total Expenditures RatioC
With institutional support
1985
$13,804,000
$14,007,000
N/A
42%
$36,134,000
2.6
$33,495,000
2.4
1989
$17,248,000
$17,072,000
80%
$39,952,000
2.3
$38,896,000
1993
$20,536,000
$19,630,000
-$302,000
69%
$45,602,000
2.2
$42,280,000
1995
$22,165,000
$20,449,000
-$286,000
65%
$56,199,000
2.5
$46,046,000
1997
$24,208,000
$23,528,000
-$1,088,000
71%
$64,736,000
2.7
$64,872,000
2.8
1999
$28,689,000
$26,200,000 $0
67%
$95,652,270
3.3
$83,437,830
3.2
2001
$30,873,000
$28,536,000
-$738,000
$97,908,000
$64,083,000
2003
$34,986,000
$32,368,000
-$714,000
66%
$104,482,000
3.0
$79,849,000
2004
$32,728,240
$33,629,560
$121,800
$120,490,360
3.7
$104,502,080
3.1
2005
$36,790,880
$34,863,360
$135,520
$100,465,120
$100,329,600
2.9

11. Table 13-1 Revenues and Expenses of FBS Athletic Departments (2009 dollars) (slide 2 of 2)
Without institutional support
$19,328,000
$19,630,000
-$302,000
51%
$20,163,000
$20,449,000
-$286,000
46%
$22,440,000
$23,528,000
-$1,088,000
43%
$26,200,000 $0
$27,798,000
$28,536,000
-$738,000
35%
$31,654,000
$32,368,000
-$714,000
40%
AAverages were reported to After that medians were reported.
BTotal Revenue Ratio = Maximum Total Revenue/Average Total Revenue. CTotal Expenditures Ratio = Maximum Total Expenditures/Average Total Expenditures.
Note: The source lists data for 2006 that are not shown here due a suspected error in the report.Source: Author’s calculations from tables in Fulks (2003, 2008).

12. Average Total Expenditures
Men's
Women's
Year
Average Total Revenue
Average Total Expenditures
Average Net
1993
14,194,000
10,570,000
3,775,000
755,000
2,718,000
-1,963,000
1995
14,014,000
10,582,000
3,432,000
858,000
3,289,000
-2,431,000
1997
15,776,000
11,288,000
4,488,000
1,224,000
4,216,000
-3,128,000
1999
17,685,000
12,445,000
5,240,000
1,965,000
5,109,000
-3,144,000
2001
19,434,000
13,407,000
6,027,000
1,722,000
5,658,000
-3,936,000
2003
22,134,000
14,875,000
7,259,000
2,142,000
6,426,000
-4,284,000
2004
17,317,640
15,257,480
1,758,560
1,796,840
6,085,360
-3,857,000
2005
19,233,760
14,940,800
2,142,560
1,820,000
6,478,080
-4,021,920
2006
20,329,920
16,411,680
1,305,720
1,838,160
6,634,440
-4,355,640
Table 13.2 Revenue and Expenses of Men’s and Women’s Programs in FBS Athletic Departments ($2009) (slide 1 of 2)

13. Figure 13.2 Non-BCS and BCS Average Payouts, 1981-82 to 2008-09 (2009 dollars).
Legend: At the average, BCS bowl payouts have always dwarfed non-BCS bowl payouts. In addition, while non-BCS average payouts have been steady over time, average BCS bowl payouts have grown in leaps and bounds, although they have fallen a bit in the last few years.

14. Figure 13-3 The University and the Athletic Department
Legend: All major elements of the university, inside the triangle, produce outputs (Research, Teaching and Service) that generate money and political support for the university. The university supports those elements best that provide money and political support the best.

15. Table 13-4 Naming Rights in College Sports
Facility
College
Total Paid ($Millions)
Duration of Rights (in Years)
End Year
Save Mart Center
Fresno State 40 23
2022
Comcast Center
University of Maryland 20 25
2026
Jones Stadium
Texas Tech
2019
United Spirit Center 10
2016
Value City Arena
Ohio State
12.5
Indefinite
Cox Arena
San Diego State 12
Bank of America
Washington
5.1
2008
Colonial Center Arena
University of South Carolina
5.5
Cox Pavilion
University of Nevada Las Vegas 5
2009
Wells Fargo Arena
Arizona State
Papa John’s Cardinal Stadium
Louisville 15
2012
Movie Gallery Veterans Stadium
Troy State University
Coors Events Center
Colorado
Carrier Dome
Syracuse
2.75
Alltel Arena
Virginia Commonwealth University 2
Cessna Stadium
Wichita State
0.3

16. Figure 13-4 The Athletic Department Org Chart
Legend: At the bottom, individual team coaches are responsible to their Athletic Director (the equivalent of the Dean for academic departments). The line of responsibility and oversight moves upward through the President (typically, not the Provost as in academic departments), the Board of Regents and, ultimately, to the Governor.

17. Table 13-8 Budgets at Washington State University (slide 1 of 2)
Revenues
Difference
Booster Club Scholarship Contributions/Endowment
$1,968,286
$2,451,854
$483,568
Corporate Support
$314,476
$302,739
-$11,737
Football Away Guarantees
$1,102,150
$1,344,020
$241,870
Football Tickets
$928,230
$1,502,620
$574,390
Men’s Basketball
$898,643
$1,312,020
$413,377
NCAA & Conference
$349,224
$447,081
$97,857
Other
$361,144
$432,316
$71,172
Radio/Sports Video
$539,105
$472,114
-$66,991
Student Fees and Tickets
$1,408,431
$1,557,302
$148,871
TV- Football Conference
$2,589,232
$3,178,349
$589,117
University Support/Tuition Waivers
$3,042,047
$2,941,530
-$100,517
Royalties
$490,000
Concessions/Merchandise
$277,810
Carry Forward
$419,269
$111,197
-$308,072
Total Revenue
$13,920,237
$16,820,952
$2,900,715

18. Table 13-8 Budgets at Washington State University (slide 2 of 2)
Expenses
Capitalized Equipment
$234,795
$733,373
$498,578
Employee Benefits
$551,972
$1,054,600
$502,628
Goods and Services
$2,799,511
$3,814,930
$1,015,419
Recruiting/Professional Development
$617,401
$586,998
-$30,403
Salaries
$4,140,899
$4,067,257
-$73,642
Scholarships
$3,192,773
$2,425,524
-$767,249
Student and Other Wages
$629,740
$1,118,885
$489,145
Team Travel
$1,310,911
$2,328,934
$1,018,023
University Overhead
$437,505
$563,375
$125,870
Total Expenses
$13,915,507
$16,693,876
$2,778,369
Net Operating income
$4,730
$127,076
$122,346

19. Table 13-9 Operating Revenues and Expenses, Washington State University and the University of Washington, (slide 1 of 2)
WSU
Revenues
Men's Teams
Women's Teams
Ratio
Total
Basketball
$2,148,239
$316,975
6.8
$2,465,214
Football
$12,630,209
Other sports
$418,866
$1,422,675
0.3
$1,841,541
Not allocated by gender
$13,538,665
Grand total
$15,197,314
$1,739,650
8.7
$30,475,629
Expenses
$1,653,650
$1,253,920
1.3
$2,907,570
$7,668,687
$1,710,020
$4,275,601
0.4
$5,985,621
$12,951,738
$11,032,357
$5,529,521
2.0
$29,513,616
Net before amortization
$962,013

20. Table 13-9 Operating Revenues and Expenses, Washington State University and the University of Washington, (slide 2 of 2) UW
Revenues
Men's Teams
Women's Teams
Total
Basketball
$4,235,886
$1,083,993
3.9
$5,319,879
Football
$28,569,263
Other sports
$675,941
$1,811,108
0.4
$2,487,049
Not allocated by gender
$6,175,329
Grand total
$33,481,090
$2,895,101
11.6
$42,551,520
Expenses
$2,492,670
$1,661,035
1.5
$4,153,705
$12,640,090
$3,970,979
$5,875,726
0.7
$9,846,705
$14,749,393
$19,103,739
$7,536,761
2.5
$41,389,893
Net before amortization
$1,161,627