Based strictly on the numbers presented in a USA Today report Tuesday, the University of Tennessee athletic department - when compared to other schools in the elite group of Bowl Championship Series automatic qualifiers - required the fifth-greatest amount of subsidized funds to balance its 2009-10 budget.
For a department that prides itself so much on its self-sufficiency that it dedicates an entire page of its website to all that it gives back to the university, those numbers simply didn't add up.
Of the $13.552 million claimed to have been subsidized to the UT athletic department- through student fees, direct and indirect institution support, and direct state support - only $1 million was actual cash that it used to fund all that goes into the 20 varsity sports it supports. The rest came from "indirect facilities and administrative support," a category on the NCAA-submitted financial report that UT and its team of auditors interpreted differently than the majority of its peers.
USA TODAY'S TOP FIVE
Subsidies are calculated using revenue categories from the school’s NCAA financial reports: student fees, direct and indirect institution support, and direct state support. The top five recipients among BCS automatic qualifying schools:
School 2010 Subsidy
1. Rutgers $26,867,679
2. Connecticut $14,578,029
3. South Florida $14,185,037
4. Maryland $13,749,781
5. Tennessee $13,552,020
Behind the Numbers
According to a report in Tuesday's USA Today, the University of Tennessee athletic department derived 12 percent ($13.552 million) of its revenue from subsidies. That's a misleading figure, though, UT officials say, as the majority of it is money that has never actually existed.
- $8.36 million: "Depreciation"
Example: Thompson-Boling Arena is one year older, therefore it is worth less than it was the previous year.
- $3.16 million: "Central support units"
Example: UT athletics, like most departments at the university, gets usage out of the chancellor's office. Though it's not charged anything for those services, it is designated a dollar worth of its usage for accounting purposes.
- $1 million: "Indirect facility support"
Example: UT athletics is hypothetically allotted a percentage of the school's utilities, security and other basic infrastructure. When it actually utilizes the campus' facility services, it covers the cost out of its own budget.
- $1 million: "Student fees"
Example: This is the only actual revenue that the UT athletic department generates outside of its walls. Because the department typically gives much more than $1 million annually back to the university, it can still claim to be entirely self-sufficient.
*Source: Bill Myers, UT senior associate athletic director and chief financial officer
No matter what way it's broken down, the UT athletic department continues to be one of the few in the nation that is not only self-sufficient, but also gives back to its university.
UT was one of just 15 public schools in the 65-team group of BCS automatic qualifiers to report any funds derived from "indirect facilities and administrative support." The $12.552 million reported by the Vols was more than twice the second-most reported in that category by the University of Minnesota.
All public Southeastern Conference schools except UT reported zero dollars for "indirect facilities and administrative support."
"They just don't report it," said Bill Myers, UT's senior associate athletic director and chief financial officer.
"You can't tell me that the other schools are not structured the same way we are."
Myers said UT and its external auditors broke down the ambiguous category of the report into three groups.
The bulk of the $12.552 million came from depreciation, which the athletic department reports on a "paper only" basis, Myers said. While companies in the private sector often put away that allotted money for future building and equipment purchases, all UT had to do was simply report the estimated $8.36 million worth of depreciation it racked up during the 2009-10 fiscal year, but not factor it in to its spending plans.
More than $3 million of the total was derived from "central support units," Myers said. Like depreciation, the funds generated from this area are hypothetical.
Buildings such as the chancellor's office and president's office are used by all facets of the university, athletics included. Only during recent budget cutbacks did the university start charging departments like Housing and Parking Services an annual fee to cover basic overhead charges. The athletics department was never charged because it annually gives back millions of dollars to the university, Myers said.
Typically, and currently, the cost is simply absorbed centrally by the university. For reporting purposes, though, a figure is needed to represent each department's respective use of the facilities, which is how the $3.15 million was added to the athletic department's "indirect facilities and administrative support" total.
A similar line of thinking was used to come up with the $1 million from indirect facility support.
Because UT's athletic buildings take up 7.5 percent of the UT campus' square footage, it is hypothetically charged 7.5 percent of the cost for campus utilities, security and other services. No specific wing of the university pays for those pre-ordained charges, Myers said, but the athletic department handles all of the costs it incurs from those services.
"There's not anything they provide for us that we aren't charged for," Myers said.
The only true subsidy UT's athletic department receives is from student athletic fees, and that could go away in the coming years, Myers said.
To fulfill Title IX responsibilities, the athletic department annually collects $1 million from the student body. It's a gesture that is "political by nature," Myers said, and there are talks of eliminating the seemingly unnecessary transaction.
"I think there's some internal questions about how the money comes and where it goes," Myers said. "I do think you'll see in the future that that money will be netted."
Without the $1 million it received from student fees during the 2009-10 fiscal year, the athletic department would simply have given back $5.84 million to the university instead of $6.84 million.
Myers said there is no category on the report to note how much the athletic department gives back to its university because "it's geared to show how athletics is taking away from campus."
"Very few of us do that," Myers said. "So why build a system to report it when most people don't do it?"