Column: Michigan’s Biggest Problem

John U. Bacon

I’ve often joked that some Michigan football fans aren’t happy unless they’re not happy. But after eleven games this season, even they could be excused for having plenty to be unhappy about. A week ago, the Wolverines were 3-and-4 in the Big Ten, with undefeated Ohio State coming up next.

The Wolverines had been surprisingly bad all season – until the Ohio State game, when they were suddenly, surprisingly good, falling short by just one point in the final minute. It was the first time I have ever seen Michigan fans feeling better about their team after a loss than before it.

Still, the heroic performance was bittersweet. The most common reaction I’ve heard this week: Where was that team all year? And which team will return next year – the one that got crushed by Michigan State, or the one that almost beat the Buckeyes?

But Michigan’s bigger problems are off the field, not on it. In just four years, the athletic department’s budget has expanded from $100 million to $137 million – and that does not include the $340 million earmarked for a new building master plan.  This rapidly growing empire could be threatened by a perfect storm of a bad record, skyrocketing ticket prices, and next season’s horrible home schedule.

This brings up two questions: How do they increase the budget by 37%? And where do they spend it?

First, Athletic Director Dave Brandon pushed aside faculty control. Michigan’s Advisory Board on Intercollegiate Athletics didn’t even know he planned to promote Michigan’s men’s and women’s lacrosse teams to varsity status – at a cost of over $3 million year – until the day before it was announced. But that’s one day sooner than they hear about large hikes in ticket prices, and just about everything else the athletic department is doing.

Michigan’s late athletic director, Don Canham, wrote in 2005 that without faculty control, athletic directors have virtually no restraints. “What $70-million dollar business could conduct business without a board of control?” Just eight years after Canham wrote his final piece, warning of “unbridled expansion,” Michigan’s athletic budget has almost doubled. Guess Mr. Canham knew what he was talking about.

Second, the athletic department needed to find new sources of revenue, and squeeze more money out of the old ones. To do so, it has tripled the size of its development staff, and pumped the prices of tickets and “seat licenses” by roughly 30% to 50%, or about $100 per seat. The athletic department now charges $9,000 for corporate events in the stadium skyboxes and $6,000 for a one-hour wedding reception on the 50-yard line. They even charge school kids for tours, which Michigan had always provided for free.

When former athletic director Bill Martin told me, “Just because you can charge them more, doesn’t mean you should,” he sounded like somebody who had retired a century ago, not in 2010.

Add it all up, and the department will not just cover its expanded $137 million budget, it will show a nearly $9 million budget surplus.

So, where does all this money go? Brandon declined to be interviewed for my latest book, “Fourth and Long: The Fight for the Soul of College Football,” so I talked to Bill Martin and former Michigan president James Duderstadt, who have seen a few budgets in their day. They’re alarmed that so little of the new money actually goes to student-athletes, and is instead spent on – well, just about everything else.

Staff salaries, for example, have grown from $34 million to $49 million under Brandon, including a 62% increase in administrator compensation. The athletic department’s spending on “Marketing, promotions and ticketing,” and “Professional travel and conference dues,” have tripled to almost three million. But perhaps most surprising is the $2.6 million the department now spends on “Hosting, Food and Special Events,” an increase of almost 500%.

In other words, the additional millions the fans are now being forced to pay are not going to the students on the field, but the suits in the building – including almost a million dollars a year for the athletic director himself, three times the salary of his predecessor.

“Look into how much is spent on marketing, then look at how effective it is,” Martin told me. “You don’t have to do marketing at Michigan. We have the fans. We have the support. We have a great reputation. All you have to do is win. If you win, they will come. You just need to make it as affordable as possible for your fans.”

Dudertadt added, “It’s a different operation now. And I think it’s a house of cards. No matter how much you ‘build the brand,’ if you don’t have the product, sooner or later, it gets you.”

And that’s why the football players aren’t just fighting for their teammates and their school, or even the school’s other sports. They’re fighting to pay for the soaring salaries of people they’ll never meet.

If you care about Michigan athletics, it’s scary to think what could happen when the players inevitably fall short, and the fountain of fan money starts to dry up.

About the writer: Ann Arbor resident John U. Bacon is the author of the national bestsellers “Fourth and Long: The Future of College Football,” “Bo’s Lasting Lessons” and “Three and Out: Rich Rodriguez and the Michigan Wolverines in the Crucible of College Football.” You can follow him on Twitter (@Johnubacon), and at johnubacon.com.

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