How a lingering sports shutdown can hit Penn State’s pocketbook

Nittany Nation

Penn State is known for plenty of sports, plenty of student-athletes, and plenty of success. If COVID-19 cancels the school’s money maker? What happens then?

Here is our best shot at painting a picture.

The basics

Penn State supports 31 sports programs – 29 of those are sanctioned NCAA sports and the athletic department also supports men’s and women’s rugby. Plenty of those sports have brought back national titles. We’re not just talking about football.

Only one other Big Ten team has more programs than Penn State. According to its athletics website, Ohio State supports 37 varsity sports. Purdue, on the opposite end of the Big Ten, only supports 17 varsity sports. It is something that makes Penn State unique, just ask Vice President of Intercollegiate Athletics Sandy Barbour.

“Our 31 programs and 800-plus student athletes, it is in our DNA. It is part of who we are,” Barbour said on a video conference call on April 2.

Penn State wrestling had won eight of the last nine NCAA titles before COVID-19 canceled the 2020 national championships. Penn State volleyball has won seven national titles under coach Russ Rose. Penn State fencing won a national title in 2014 and finished runner-up in 2019. Not to mention women’s soccer, men’s gymnastics and men’s volleyball have all won national titles since 2000.

Penn State is not short on success, but it could be short on funds if the football season is canceled.

Penn State wrestling celebrates its eighth national title in nine years at PPG Paints Arena in Pittsburgh in 2019.

The money

Football makes the money. Football funds nearly every other sport at Penn State and every other major university.

For example, look at the reigning football national champions: Louisiana State University. According to a report by the Lexington Herald Leader, LSU’s athletic department had a net profit of $8,809,902 in the 2018-19 fiscal year. Without football’s profits, LSU would sit nearly $47 million in the red during that same time.

LSU football’s $56 million in profits funded the other sports that operated at a loss. You can apply the same model to Penn State.

“We have over the course of the last five years built up our reserves, so we do have, I wouldn’t call it robust, but it is an adequate reserve. We are going to be fine for fiscal year (2020), so then you move into the unknown as it relates to 2021,” Barbour said.

Penn State’s Whiteout football game had an announced attendance of 110,669 against Michigan on Oct. 19, 2019. The current financial model of major college athletics depends on revenue generated by its football programs.

The future

If college athletics depend on revenue brought in by football, a cancellation of the college football season could be devastating.

We’re not just talking money brought in by tickets, parking and concessions. The Big Ten conference announced a six-year television deal worth $2.64 billion in 2017. That revenue is distributed among Big Ten schools.

If schools lose out on revenue due to canceled sports, schools will need to find ways to save money. This could include all sorts of budget cuts including even cutting sports programs.

Smaller schools around the country have already cut sports. Old Dominion in Norfolk, Virginia, cut its Division I wrestling team on April 2. St. Edwards University, a Division II school in Texas, sent six different sports to the chopping block on April 15.

“Our primary focus is holding our 31 programs and our 800-plus student athletes together and finding a way as a Penn State community to come through this on the other side,” Barbour said.

Coaches and athletic staffs around the country have taken voluntary pay cuts as well. In the Big Ten, both Rutgers and Minnesota have announced their head coaches will take pay cuts.

It is unclear if Penn State will need to do something similar.

“If this goes into the fall, with the revenue that football brings in at Penn State, and what it brings in at other universities across the United States, that is going to be a whole different conversation,” Penn State football coach James Franklin said on a video conference call on March 25.

Right now, we can sit and wait for the fall. We will see what the college football picture looks like in Happy Valley then.

Copyright 2020 Nexstar Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

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