The University of Tennessee has a top-notch football team, record-breaking financials and another plan to use the former to build on the latter — with an eye on the future.
The university announced a 10 percent “talent fee” will be added to the cost of 2025 football season tickets, in preparation for the arrival of revenue sharing with college athletes. That, along with an initial 4.5 percent average increase, means Vols fans will pay 14.5 percent more on average for tickets next season.
“According to current settlement projections, which may be effective as early as July 1, 2025, institutions can share revenue with their student-athletes,” the university said in a statement announcing the price hike.
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Judge Claudia Wilken of the Northern District of California declined to rule earlier this month on preliminary approval of a multi-billion dollar settlement in the House v. NCAA lawsuit because of language that would limit third-party name, image and likeness payments to athletes from boosters and collectives. Wilken advised lawyers on both sides to “go back to the drawing board” on a settlement that would provide $2.75 billion in back-pay damages for former Division I athletes and implement a revenue-sharing model between power-conference schools and athletes.
A May news release on the settlement described the revenue sharing as an “addition to scholarships, third-party NIL payments, health care and other benefits that college athletes already receive.” It estimated that over the 10-year settlement period, the total value would “exceed $20 billion, making it one of the largest antitrust class-action settlements in history.”
Tennessee has made enormous financial gains since athletic director Danny White was hired in 2021, setting a record in the 2022-23 financial year with $202.1 million in revenues — obliterating the previous fiscal year’s record of $154.6 million. Aggressive fundraising is part of the strategy, and that total in the 2022-23 fiscal year was a record $131.45 million.
That includes per-seat donation programs for the basketball, baseball and softball teams. When White arrived, Tennessee only had that program for football.
Now Tennessee is asking for more while projecting to account for revenue sharing, which is expected to permit schools to spend more than $20 million on athletes in the first year the settlement would take effect. UT is offering appointments for season-ticket holders to discuss the matter at inviting emailed questions at tnfund@utk.edu.
Why is Tennessee doing this?
Athletic departments are trying to prepare to meet the rising costs coming their way, and some athletic directors have issued public warnings that the process may include cutting sports or otherwise trimming department expenses. Meanwhile, the wealthiest programs are searching for more revenue rather than cutting significantly from their budgets, and Tennessee may not be the last such program to try to openly pass the cost along to fans.
“We will continue to grow our other revenue streams and be efficient with our expenses to maximize the anticipated full revenue share allotment,” Tennessee said in its release. “There has never been a time in college sports where revenue growth had such a close correlation to winning.”
Tennessee’s Spire Sports collective was one of the first in college sports to aggressively raise money and utilize the new NIL rules for talent acquisition in 2021, and Tennessee baseball just won its first national championship in June. But Tennessee football is 26 years removed from its last national championship and SEC championship, and the Vols have never made the College Football Playoff. That ongoing chase gives Tennessee athletics a plea that SEC competitors such as Georgia and Alabama don’t have.
And donor fatigue is a very real concern in college athletics. “We’re now in the third year of NIL, and a lot of schools’ donors aren’t getting a return on their investment,” Jason Belzer, founder of the Student Athlete NIL agency, which advises about 50 collectives, told The Athletic’s Seth Emerson earlier this year. “Before you at least got your name on the building. Now you pay for the payroll, and your team doesn’t win.”
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(Photo: Brandon Sumrall / Getty Images)
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Publish date : 2024-09-17 05:44:00
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