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“RAPID” – A Response

This past week, the University of Colorado Athletic Department released its first “RAPID” report, a comprehensive overview of the department’s goals, initiatives and accomplishments. “RAPID” for CU, is an acronym standing for Respect, Accountability, Passion, Integrity and Dedication, with the full report available on line here.

The report, which the department plans to issue on an annual basis, is a comprehensive view of CU Athletics that reaches far beyond wins and losses.

According to CU …

Much like an annual review from a Fortune 500 company, the report includes a look at financials, programming and initiatives; a report card on the department’s strategic plan; as well as academic and athletic achievements by CU’s student-athletes. Also included are detailed explanations of where support funds are directed in assisting student-athletes, including health and wellness, academic support, facilities and scholarship expenses.

“It really is intended to be an annual report,” Athletic Director Rick George said. “I think it gives our donors and our alumni — our constituents — an opportunity to see what we’re doing,  how we’re doing it and why we’re doing it. It gives them confidence that their investment is having a real impact on our student-athletes’ experience at CU.”

Let’s look at some of the numbers …

CU athletic department revenue and expenses:

FY (Fiscal Year) 2014 … Revenue: $58,931,239 … Expenses: $61,600,647 … Net: -$2,669,406

FY 2015 … Revenue: $61,210,483 … Expenses: $61,209,592 … Net: $  691

FY 2016 … Revenue: $69,414,534 … Expenses: $69,414,307 … Net: $  227

FY 2017 … Revenue: $86,537,487 … Expenses: $86,537,295 … Net: $  192

Takeaways:

— CU has had a balanced budget for each of the past three seasons. Compare Cal, which is facing a $16 million deficit this fiscal year … Compare Washington State, where the athletic department said it owes its university $51.5 million after posting operating deficits for six straight years … Compare Utah, which has a budget of around $75 million, and is breaking even.

— While CU’s $86 million in revenue is impressive (and about double what CU was bringing in 2010, CU’s final season in the Big 12), it is still only mid-range nationally, and in the bottom half of the Pac-12. All four of the California schools, the Arizona schools, Oregon and Washington all have bigger budgets. Colorado consistently ranks only above Utah, Washington State, and Oregon State in terms of athletic department revenue.

 

Football ticket revenue:

FY (Fiscal Year) 2014 (2013 season) … $ 9,726,080

FY 2015 (2014 season) … $ 9,075,419

FY 2016 (2015 season) … $ 9,746,717

FY 2017 (2016 season) … $ 11,162,432

Takeaways:

— Ten wins in 2016 clearly played a significant role in the increase in revenue, including a sellout in the regular season finale against Utah, the Buffs’ first sellout in eight years;

— While the win total was cut in half in 2017, there shouldn’t be a significant drop off in ticket revenue. The average attendance in 2016 was 46,608. This past season, while there were no sellouts, there was actually an increase in  average attendance (to 47,055).

 

Pac-12 distributions and licensing revenues:

FY (Fiscal Year) 2014 (2013 season) – Pac-12 distribution: $21,175,499 … Licensing revenue: $502,725

FY 2015 (2014 season) … Pac-12 distribution: $24,444,908 … Licensing revenue: $672,919

FY 2016 (2015 season) … Pac-12 distribution: $26,775,244 … Licensing revenue: $702,978

FY 2017 (2016 season) … Pac-12 distribution: $30,384,099 … Licensing revenue: $873,940

Takeaways: 

— In one sense, the Pac-12 distribution increases are very impressive. From $21 million to $30 million in four years is quite a leap (and these numbers make the $8-10 million CU would bring in as a member of the Big 12 look like chump change). On the other hand, there are reasons for concern, as the embarrassment of riches Pac-12 teams are enjoying are still just a fraction of what other Power-Five conferences are bringing into their coffers.

Jon Wilner at the San Jose Mercury News has been following this story for years. In 2015, Wilner ran a series of articles, pointing out how the Pac-12 was falling behind the other conferences in revenue distributions, and how the gap would continue to widen. This past fall, Wilner pointed out that, over the next five years, the average Big Ten school will take in almost $100 million more than the average Pac-12 school (that’s not the Big Ten conference taking in $100 million more than the Pac-12, that’s $100 million more per school).

— As to licensing revenues, the numbers speak for themselves. If you want to have a 24% increase in year-over-year licensing sales, it’s easy … win ten games.

 

2014-17 Strategic Plan Executive Summary/Report Card

Percentage metrics on/off track by Strategic Intent

Strategic Intent: Financial

Fiscal Year (FY) 2015: 65% on; 35% off

FY 2016: 80% on; 20% off

FY 2017: 89% on; 11% off

Strategic Intent: Competitive

Fiscal Year (FY) 2015: 42% on; 58% off

FY 2016: 52% on: 48% off

FY 2017: 64% on: 36% off

Strategic Intent: World Class programs

Fiscal Year (FY) 2015: 47% on; 53% off

FY 2016: 53% on; 47% off

FY 2017: 67% on; 33% off

Takeaways: 

— Having a report card on your own strategic plan is roughing the equivalent to grading your own paper. You get to decide what metrics to apply, and get to decide how those metrics apply to your goals. That being said, the steady improvement in each of the graphics is noticeable and impressive.

— If you want to take a deeper dive into how these figures were calculated, whether the goals set are reasonable, and whether the CU athletic department is taking appropriate steps to achieve those goals, the CU 2018-2020 Strategic Plan can be found here.

 

Sustainable Excellence Initiative (SEI)

Endowment Goal: $20 million … amount received/pledged: $34,038,072

Capital Campaign Goal: $85 million … amount received/pledged: $66,593,822

SEI Goal: $105 million … amount received/pledged: $100,631,894

Takeaways: 

— The “Drive for $105” has almost been realized. CU is less than $5 million shy of obtaining the overall goal of $105 million.

The Sustainable Excellence Initiative, when launched just a few short years ago, was among the largest capital construction projects active in all of college athletics.   Comprised of three distinct priorities – the new Champions Center, a new Indoor Practice Facility, and the renovation of the Dal Ward Athletic Center – the total project cost was estimated to be $156 million, including 337,000 square feet of new space and another 38,000 square feet of renovated space.

It was a pretty ambitious goal for a program which had never raised over $15 million in any one year prior to the launching of the campaign … and yet the CU athletic department is pulling it off. For Buff fans, who have sat around for almost two decades since the Dal Ward Center was constructed, watching CU athletics fall further and further behind in facilities, the SEI has been a huge success.

Overall Takeaways:

— Colorado is only a year or two away from having a $100 million athletic department budget. It was only a few years ago that there were only a handful of programs (e.g., Ohio State, Alabama, Texas A&M and Texas) who could boast such numbers. Now, a $100 million budget will only keep you in the top half of Division I programs nationally.

— The Denver Post, in typical Denver Post fashion, led of its account of the RAPID report with the following headline: “CU Buffs athletic department netted $192 in profit during the 2017 fiscal year, according to report“. The gist of the headline was that Colorado banked less than $200 last year. That’s not the point at all. The point is that, for three consecutive years, the CU athletic department did not spend more than it took in. A seemingly simple goal, it is a huge achievement when other schools in the Pac-12 conference – most notably Cal, but there are others, including Washington State and the Arizona schools – face significant financial challenges.

— CU, while maintaining a balanced budget, did so while constructing the Champions Center, which gives the Buffs a fighting chance to remain competitive in athletics. It is not insignificant that CU’s Recruiting Classes, ranked nationally in the 60’s and 70’s before the Champions Center was built, have been in the 30’s and 40’s nationally since the Champions Center opened two years ago.

— As positive as some of the above numbers are, there remain significant challenges. The Pac-12, coming off of a poor season on the field in football – and facing the reality of being only a three- or four-bid conference in the NCAA men’s basketball tournament – is falling behind not only on the football field, but in the financial ledgers as well.

— And … as always … nothing improves the bottom line like a winning football program …

—–

 

5 Replies to ““RAPID” – A Response”

  1. Great news and the surest sign that CU is on solid footing with RG at the helm. The strides that they have made financially in his tenure is really quite amazing. That said, the Buffs (and the Pac12) are definitely swimming against the tide. Let’s hope RG has some more tricks up his sleeve to gain some ground with the other P5’s.

  2. Great highlights and analysis. Thanks. I think a balanced budget is extremely important as we move forward as it lets us actually take advantage of our successes.

  3. Thanks for diggin through this and summarizing the highlights.

    As for the Denver comPost’s negativity towards CU’s meager profitability…….please……that paper will be extinct in 24 months and it won’t be because its making money.

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