Just six months after UAB President Ray Watts made what he termed an agonizing decision to shut down the school’s football program because of its pending financial insolvency, he announced Monday that Blazer football is back. Sometime in the next couple of years — once UAB has re-recruited its players, reassembled its coaching staff and regained admission to the Football Bowl Subdivision — Birmingham will once again have a (relatively) big-time college football program.
A whole lot changed in the interim, including the data being used to back up the decisions. In his announcement of the reversal, Watts cited an influx of outside financial pledges to the football team as the key reason a program is once again viable. Some observers, including Paul Finebaum, a popular sports-talk-radio host in the South, point to the fervent outpouring of support for the team after its demise. (Online, the #freeuab movement has been particularly impressive and has often been coupled with the #fireraywatts hashtag.) Local politicians have also been pressuring Watts into reinstatement, perhaps because much of the pressure behind the decision to shut down the program seems to have come from Tuscaloosa, where the University of Alabama football program has often been hostile toward UAB’s. But the biggest change seems to be which model of Blazer football’s financial future Watts and UAB are choosing to trust.
Over the past year, entities within UAB have commissioned three separate forecasts from three consulting groups to analyze the financial prospects of its athletic department with and without football. Universities often lean on projections from outside consultants when making major decisions, but these projections are controlled by the formulas the consultants use — formulas that aren’t always statistically rigorous. In this case, despite having access to much of the same data, the reports contain completely different projections about the program’s impact on the university. One says it will cost the university millions of dollars a year. Another says the program will roughly break even. And another — the one UAB tried to cancel midway through — says football will be a huge financial boon. Small differences the consultants made in the assumptions behind the models created huge effects in the data sets. As a result, their recommendations were completely different.
When Watts announced the death of the program in December, he cited a report from CarrSports Consulting projecting that if the athletic department kept football, it would lose more than $5 million a year and would need to spend an additional $20 million to improve facilities. CarrSports got those numbers by pairing generous calculations for the cost of fielding what it termed a competitive Conference USA team with modest increases in ticket sales, donations and student fees. “When considering a model that best protects the financial future and prominence of the athletic department, football is simply not sustainable,” Watts wrote at the time.
Pushback in the wake of the decision, combined with complaints over the discovery that some may have been planning for the cancellation before the review even started, led UAB’s Athletic Assessment Task Force to commission another study. This time the consultants were College Sports Solutions (CSS). CSS said that although an athletic department with a football team would lose roughly $3 million a year compared with a department without football, mainly because of financial aid for players, almost all of that would be made up by increased enrollment, donations and other revenue resulting from the national prominence a football team brings. The study concluded that either resurrecting the program or leaving it for dead were “viable options”; Watts leaned on this report when announcing football’s return.
There was another study, too, that fell between CSS’s and CarrSports’s. The task force had originally engaged a firm called OSKR to lead the review before the administration vetoed its hiring in March. Allen Bolton, UAB vice president of financial affairs and administration, said he was worried that the OSKR team had already made up its mind that UAB should keep the sport, explaining that “due to their very own comments this firm does not meet the critical threshold for many of providing a fresh, new, unbiased analysis.” OSKR finished its review anyway and found that keeping football would add an additional $2 million a year to the university’s coffers once benefits from donations and exposure were accounted for. OSKR’s projections are the most optimistic, and they seem to be the most rigorous. They model not only expected changes in the athletic budget over time, but also the impact of the team on the university’s media coverage, out-of-state enrollment and conference affiliation.
Two major factors caused the $7 million swing in annual projections that led to the disparate recommendations: First are projections on how fast football-related revenue will grow. CarrSports projects that with football, the athletic department’s revenue will grow a measly $300,000 or so a year, while OSKR and CSS both project more than $1 million each year in added revenues. The larger forecast makes sense considering that Conference USA’s TV deal with Fox Sports alone is worth more than $1 million a year to each team.
Second are assumptions about expenses. Both the CarrSports and CSS reports treat athletic scholarships as, basically, gifts that cost the university about $4 million to give each year. In his Tumblr, OSKR consultant Andy Schwarz argues that this is willful manipulation because the actual expense to the school to feed, educate and house its players is much, much lower than the projected $52,000 each scholarship “costs.” In addition, he notes that the program attracts full-tuition-paying walk-ons who are transferring out now that the program has been shuttered. By OSKR’s math, scholarships cost the university only about a million dollars a year.
Once you add in the reports’ different assumptions about football’s impact on student enrollment and alumni donations and the need to upgrade facilities to be competitive, you’re left with the final mess, in which UAB’s president can totally reverse course — and still have a model that backs him up.