Unusual arrangement for U. of I. sports
The University of Illinois in June announced a massive fundraising campaign for financial aid assistance, its latest effort to help struggling students pay for college.
But a potential source of money remains committed to the university division so flush it basically operates independently: the athletics department, which has a $75 million operating budget.
This year, the university will provide the athletics department with more than $920,000 worth of free tuition for its athletes, essentially scholarships in the form of tuition waivers, the Tribune found.
The arrangement, which the university says began in the 1970s, will continue despite a university committee’s recommendation to phase it out over five years. Instead, the university is reducing it over five years until the amount is $500,000.
This type of assistance is not common among Big Ten schools. Although public universities provide other forms of assistance to their athletics departments, such as building new stadiums or allowing out-of-state athletes to pay in-state tuition, only the University of Wisconsin at Madison said it receives funding for athletics scholarships.
The money given to the athletics department at the Urbana-Champaign campus is supposed to ensure that the school meets Title IX requirements for gender equity. But records show that the waivers are reported to the NCAA as revenue for both women’s and men’s sports, including the football program.
Illinois officials said reducing the subsidy won’t cause any student-athletes to lose scholarships but warned that eliminating the subsidy outright would be unfair and difficult for athletics to make up in the current economy, and it could mean cutting some men’s teams.
“Everybody thinks athletics is loaded with money,” said Associate Chancellor Bill Adams, one of seven committee members. “It is always two losing football seasons from being in trouble.”
With the coming reductions, the money that would otherwise go toward the athletics waivers will go to other need-based aid, as the university is trying to increase overall scholarship opportunities, said spokeswoman Robin Kaler. Last year, the annual subsidy was more than $1 million, before the first reduction took place.
Robert Easter, who as interim chancellor appointed the committee that reviewed waivers and suggested the five-year phaseout, decided to reduce the waiver amount. However, he said it would be best if the scholarships were eliminated completely.
“That would be the ideal,” said Easter, who finished his service as interim chancellor at the end of September. “Anytime you are putting money out of general revenue into the program, it is coming from tuition or a decreasing amount of money the state provides. We have to be careful about those things.”
The waivers have existed for decades, with the intent of supporting women’s athletics.
After the school implemented Title IX in 1974, the seven women’s sports teams operated on a combined budget of $74,000, said Karol Kahrs, who helped create the women’s athletics program. Complying with Title IX “was expensive, no question about it,” said Kahrs, who retired in 2000. Kahrs said the waiver money helped.
By 2007, the athletics department was receiving more than $1 million a year in waiver money.
But in February 2010, Easter appointed a committee to review the $6.5 million in undergraduate waivers, part of a larger effort to cut costs and reallocate funds throughout the university. The committee was tasked with reviewing all types of waivers — from those for general financial aid to those for musical talent — and how they were awarded.
“The primary focus of this review is to assess whether new funding sources or changing priorities could allow our campus to reallocate funds in a way that improves our ability to strategically assist students,” Easter wrote in a letter to the committee in March 2010 before it began its review.
In its April 2010 final report, the committee issued 10 recommendations. One was for the school to devise a plan to phase out the waivers over five years and assess the impact such a decision would have on athletics. The committee noted that athletics stood out as the only department that didn’t need the money.
Waivers “represent the smallest portion of the total annual budget, and where there would seem to be the greatest potential for raising funds from other sources to replace them,” the report said.
Committee Chairman Ilesanmi Adesida, the university’s engineering dean, said the committee realized it was not feasible or equitable to “pull the plug” and eliminate the athletics waivers immediately.
He said that doing so would have “implications that would extend far beyond the athletic program” because college athletics affect the whole college experience and university community. The five-year phaseout was presented as a “reasonable starting point for the discussions that the chancellor might consider.”
The athletics department’s official response to the report said waivers helped attract and retain female athletes. It warned that eliminating or reducing them could force scaling back support for expenses like the marching band, limiting recruitment to only athletes in Illinois and dropping some men’s sports.
The university chose to reduce the funding. The difference will be made up with gifts and endowments or through reallocating of other money, according to the university. In a letter announcing the reduction, Easter wrote that the changes “will allow us to both support student-athletes and help us meet the significant financial needs of our student body.”
A letter from the chancellor’s office in September said the issue would be revisited in five years.
Still, other public Big Ten schools said they manage to fund their athletics departments — and provide scholarships — without tuition waivers from their university’s general funds.
The Tribune reached 10 conference schools, and only Wisconsin’s athletics department said it received funds from its school general fund for scholarships. (Northwestern University is private, and Penn State University did not respond to repeated inquiries).
Some universities are self-sufficient. “We don’t get a cent from the university or the state,” a Purdue athletics spokesman said.
Another recommendation from the committee was to emphasize scholarships as a fundraising priority. The university’s new three-year campaign launched in the summer, called Access Illinois, has the ambitious goal of $100 million. President Michael Hogan kicked the effort off by pledging his own $100,000.
The university did not make Hogan available for comment, with a spokesman saying waivers are not an issue Hogan is directly involved with.
Meanwhile, NCAA compliance forms show that since 2005, the athletics department has reported a portion of the waivers as revenue for men’s sports, including the football program. Last year, the amount for football was $270,203.
Kaler said reporting the waivers as football revenue was an “accounting quirk” and later added that the employee who decided to do so “is long gone.”
She said the athletics department blends the funding into the rest of its overall revenue to provide scholarships to female athletes. She noted that the overall amount provided in scholarships to female athletes at Illinois exceeds the waiver amount.
Records show that in 2010, the athletics department provided $4.3 million in aid to 180 female athletes, compared with $5.4 million for 245 male athletes. Records show that the department also taps its alumni foundation and endowment interest.
"(Tuition waiver funding) comes in as revenue, and we know that we are providing well over what the campus sends (athletics) on scholarships for female athletes,” Kaler said. “Basically, it serves as a discount on (athletics) net tuition payment back to the campus every year.”
Susan Greendorfer, a retired university professor who taught sports sociology and has written about Title IX, was surprised to hear the school provides funding to the athletics department — even to comply with Title IX.
“I’m really shocked at that,” said Greendorfer, who retired 13 years ago. “I find it hard to believe that the (athletics association) did not have the money.”
Kahrs said the waivers are important to offset costs out of the university’s control, including travel — which, in the recent blizzard of conference realignment, is poised to grow. Removing the waivers means reallocating other funding at the students’ expense, she said.
“It took a long time to get the athletic program solvent and strong enough to be managing its affairs on its own for a long time to come. It’s a lot of blood, sweat and tears from a lot of people,” she said. “And the lifeblood of successful athletic programs is talented student-athletes.”
Tribune reporter Jodi S. Cohen contributed.
Get our high school sports newsletter
Prep Rally is devoted to the SoCal high school sports experience, bringing you scores, stories and a behind-the-scenes look at what makes prep sports so popular.
You may occasionally receive promotional content from the Los Angeles Times.