Endowment, buildup boosting athletic assets
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This story originally appeared in the Times Picayune on 10/25/02.
Reprinted by permission.
By Ted Lewis and Marty Mul?
Staff writers/The Times-Picayune
Rick Dickson knows full well what lies at the end of the rainbow: Stanford.
The California university, with its enormous resources and wealth, has Dickson's model athletic department. Stanford arguably fields the nation's best all-around program, with four NCAA title teams and 18 individual champions in the past school year from the 34 varsity sports it sponsors.
Stanford's $45 million budget is largely derived from the interest on a $400 million endowment to its sports.
"In other words," said Dickson, athletic director at Tulane, "it's a self-renewing resource. It must be a great way to run an athletic department."
It's a luxury not afforded to Dickson, who must see that Tulane's athletic assets are efficiently used -- and constantly replenished -- if the Green Wave is to remain competitive. Tulane's program has a much lower profile, with fewer than half of Stanford's teams and a significantly smaller budget.
It's a long way from Stanford's riches, but in three years Dickson has built a $10.5 million endowment to alleviate some of the financial burden on Tulane's athletic department.
In addition, a new decentralized university accounting system instituted by President Scott Cowen has made it easier for Tulane to use various resources to pay for its athletic program each year.
Making ends meet, however, is a long-term task.
"A lot of people can achieve success in different ways," Dickson said, "but to sustain success, that's the highest bar you should shoot for."
Tulane is a private school with a relatively small endowment, meaning it must maximize its money in every area.
Its sports programs have long been perceived as being run on the proverbial shoestring budget.
But in reality, of the 10 football-playing programs in Conference USA, Tulane's 2000-01 athletic department budget of almost $18 million was ranked fifth. That budget has now grown to more than $20 million.
Tulane athletics received a fiscal boost several years ago when Cowen switched the university's accounting to a decentralized system, which spread shortfalls around to all university departments, minimizing the impact on any single area.
"Those costs are now borne by the law school and other departments," said Gary Roberts, a law professor and once the athletic faculty representative.
"What that means is that the athletic department's deficit is now a central cost and it's distributed among the revenue-generating academic units."
Dickson oversees a department that has a budget of $20.4 million -- though $8 million of that total is really what amounts to a paper transfer, an allowable tuition waiver -- to sponsor 16 sports, none of which makes a profit.
The department also operates with a deficit -- projected at $1.6 million this year, though Cowen said it likely will be "considerably more" -- allowed by the university, but one decreased by nearly $500,000 since Dickson took over in 2000.
Deficits are not unusual, particularly at private schools, which generally find ways to pay the difference.
In the past few years at Tulane, the deficits have been larger than the projections, although the school will not release the exact amount.
Kevin White, a former Tulane athletic director now at Notre Dame, pointed out that the Green Wave sports finances don't look very different from those at similar universities. "Most of those schools (meaning small and private) are subsidized. I'm privy to a lot of information on that, and I can tell you some are huge subsidies."
Fund raising is essential to fuel a program such as Tulane's, and contributions to athletics range between $3 million and $5 million in any given year, divided into three categories: capital (for building projects), restricted (for specific purposes) and unrestricted (for any purpose).
In each of the past two years, Tulane, which had never before raised $1 million in unrestricted giving, took in $1.1 million and $1.2 million.
Those are not eye-popping figures in comparison with large state schools, but University of Houston athletic director Dave Maggard said the Green Wave is doing well. "The thing about large state universities is they've been around for a long time and they've developed their fund raising. Their alumni bases live not too far from campus and they have enough (in numbers) to draw from. Schools like Tulane don't have those advantages . . ."
Bill Goldring, a major contributor, is an outspoken supporter of athletics at Tulane. "Tulane is a major university," he said, "and a major university requires a major athletic program. When somebody in San Francisco or Kansas City who went to school at Tulane picks up the paper on Sunday to check scores, he thinks, 'I went to school there,' and that keeps him mindful of Tulane."
The endowment Dickson has built up, modest as it may seem, gives Green Wave athletics another $650,000 a year in interest for department needs. "It's something we didn't have before, and it helps," Dickson said.
When Dickson arrived at Tulane, he inherited a system of individual coaches fund-raising strictly for their individual sports. "In a sense, Tulane coaches were competing with other Tulane coaches," he said.
"They were told, 'OK, here's your budget and you can go out and raise more money on your own.' And the aggressive ones did. But that's not the way to run an organization," Dickson said.
Tulane's athletic department had to organize, he said, and "position ourselves as a Division I-A program, and at the same time try to develop a strategy and plan for the next two decades or so. With all of these changes that are going on (in college athletics), here is a plan to allow us to compete and sustain."
J.D. Barnett, who heads the principal fund-raising arm of Green Wave sports, the Tulane Athletics Fund, said, "We think we'll be able to build on what has been done over the last few years."
Tulane will need it, because expenses never go down.
In addition to the normal rises in the costs of doing business, which usually increase about 10 percent each year, Dickson soon will have added expenditures.
The school dropped men's track last spring to meet federal gender equity guidelines. But two new sports, swimming and another yet to determined, have to be added because of new NCAA rules requiring 16 sports for Division I-A programs.
The new sports will cost Tulane athletics an estimated $250,000.
One expense that won't rise, at least until 2006 when the contract expires, is Tulane's use of the Superdome. Although some Green Wave supporters are unhappy with the facility, mostly because it's not filled with fans on game day, Tulane has a sweetheart deal, paying scaled rent that starts at $12,000 per game day and can rise to $25,000, depending on attendance.
At the most, that means Tulane has a fine home field at a maximum cost of $150,000 a year. Contrast that with, say, LSU's Tiger Stadium in Baton Rouge, where $500,000 a year is budgeted for maintenance.
Maggard, whose Cougars are in a new campus stadium, said Tulane seems to have a good deal, though he adds, "It's always better in the long term to have your own place."
The lifeblood of all college programs, particularly at schools like Tulane, is monetary contributions.
The Green Wave was fortunate for a long time to have some alums so devoted that they spearheaded -- and funded -- giving projects for sports. Kent McWilliams, Ben Weiner and Jim Wilson, all of whom are dedicated to the school, for years were the major figures in Tulane fund-raising.
"As the years pass," McWilliams once said, "the only ties many have with their old school is through athletics."
McWilliams and Weiner have died in recent years, seemingly putting a dent in that area of Tulane sports. "Those were unusual guys," Dickson said. "They really did bleed green. They put their money where their love was."
It might seem that without those men Tulane could have a fiscal problem. That's not the case. Dickson cites other supporters "who are stepping to the plate."
Wilson, the last of the three major Green Wave fund-raising figures, put Tulane and finances in clear perspective: "It's healthy," he said. "And I'm a realist. I don't look for the day, as some do, when Tulane will be a big-time football power. . . . The main idea is to get to the point where you don't have to rely on packed houses to survive. And we're getting there."
? The Times-Picayune. Used with permission.
