March 18, 2010

NCAA Tournament Bid Aids University Finances

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In addition to inspiring a surge of school spirit on the hill and among Cornell alumni throughout the world, the Big Red basketball team’s recent success and NCAA tournament hype has had a considerable financial impact on the University.

Current-use gifts, or gifts for operations, go toward recruiting, equipment and out-of-region travel, which increases team exposure.

Webster explained that the Big Red’s athletic success may be attributed “obviously to the performance of the athletes, but also to the coaches and the investments that our alumni have made. It has had a dramatic impact and the return on investment is significant.”

Despite this positive economic impact on athletics at Cornell, other schools in the tournament have likely enjoyed even greater financial benefits.

Larry Quant, associate director of athletics for financial operations, said that the economic impact is “not major compared to other schools in other [college basketball] conferences.”

For the Cornell Athletics business office, he explained, there are three overall components of financial income: ticket sales, concessions/merchandise sales and financial payments from the NCAA.

As for ticket sales, Quant said that “certainly there has been some impact [due to basketball’s success], but it is not as large as you might think.” He attributed this minor impact to the fact that many of the additional people who attend basketball games are students who get in for free due to the Student Activity Fee.

“It’s great to have them there,” he said, “but there is no financial impact.”

The second component, concessions and merchandise sales, similarly has a small economic impact because Cornell Athletics contracts to outside groups and receives only a percentage of the sales.

The Cornell Store, for example, has enjoyed stronger sales of Ivy Champ and NCAA licensed clothing this year than the two previous years that the Big Red qualified for the NCAA tournament, according to Gary Swisher, deputy director of the Cornell Store. In fact, the store has already sold twice as many Ivy and NCAA shirts as they did through the entire tournament last year. So far, sales of NCAA and Ivy merchandise, including t-shirts and a cap, have totaled just over $15,000 as of Mar. 17.

Looking forward, “if the team wins both games this weekend, we expect some real hysteria,” Swisher stated in an e-mail.

However, he added, “Compared to other stores serving schools with well-developed fan bases, our sales are fairly modest. A win in the opening game on Friday would probably add a boost, although we have no experience to forecast how much.”

Although he granted that sales of these products do not have a big impact on overall sales, he said that “it is a nice bump during an otherwise quiet time of year.”

The third component of income for Cornell Athletics is the financial payment that teams receive if they qualify for the NCAA basketball tournament. However, according to Quant, the Ivy League conference office keeps the payment to help fund operations. Cornell does not receive the extra money directly, whereas in other conferences the schools may benefit from the payments.

However, the real financial impact on Cornell will be determined after the results of the NCAA tournament. Cornell fans will watch the Big Red play fifth-seeded Temple University Friday at 12:30 p.m.

Original Author: Elizabeth Krevsky