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LSU football program valued at $89 million
By Stephanie Kraft
LSU has the seventh most valuable college football program in the nation, according to a recent article in Forbes Magazine. The estimated value of the program is $89 million, earning an annual profit of $39 million.
According to economist Loren Scott those profits get spread around.
"LSU's football program not only makes money, but it actually contributes money to the academic side, which is very, very unusual," Scott said.
Another factor that makes LSU Football unusual is that it is one of only two programs in the country that receives no subsidies. USA TODAY reports that LSU and Nebraska alone have athletic departments that do not rely on subsidy money.
"Taken together, the subsidies for athletics at 99 public schools in the NCAA's 120-member Football Bowl Subdivision grew about 20% in four years, from $685 million in 2005 to $826 million in 2008, after adjusting for inflation. At more than a third of those schools, the percentage of athletic department revenue coming from subsidies grew during the four-year period studied", USA TODAY reports.
Southeastern Conference rival schools Alabama, Auburn, and Tennessee are among the 30 schools that had their subsidies for the athletic department dramatically increase over the past four years.
The LSU athletic department receives no state tax dollars or any revenue from student fees to assist with its 81.5 million dollar budget.
Instead LSU generates revenue for its athletic department through the Southeastern Conference distribution, ticket sales, radio and television contracts, corporate partnerships, parking, concessions, and merchandise.
LSU is also assisted with private funding from the Tiger Athletic Foundation.
LSU athletics is a self-sustaining entity and annually gives back money to the university side of the campus for various projects throughout the year.
In addition to turning a profit for the school, the Forbes article says each Tiger home football game has an $8.2 million economic impact on the local economy.
"When you fill up Tiger Stadium on a Saturday night, it's like having a huge parish population all in one place, and they're all spending money," said Scott, "in terms of hotel rooms, restaurant meals, gasoline sales and those sorts of things."
LSU and local businesses may come to depend even more heavily on the economic boosts it gets from the football program as the State government continues to attempt to carve nearly $250 million from higher education budgets because of continually declining state revenue. The LSU System's share is more than $40 million.
Originally Published: Issue 862 - January 27, 2010
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