Follow the money: Sports economists talk I-A vs. I-AA

This story ran April 23, 2013 after about two weeks of tracking down sports economists in between doing my daily stories for the paper. JMU is considering a move from I-AA to I-A, and this story covers what might be waiting for JMU, if it jumps to I-A.

HARRISONBURG, Va. — James Madison University is an oft-rumored candidate to jump to college football’s top classification: Division I-A. It is the world of multimillion-dollar bowl payouts and gaudy television contracts.

But if JMU, currently studying the feasibility of a move from I-AA, makes the jump, that world, one sports economist said, won’t be Madison’s.

Rodney Fort, the co-director of the University of Michigan’s Center for Sport Management, said JMU — and other I-AA football powers such as Old Dominion, Appalachian State and Georgia Southern, which have already committed to moving up — likely would be relegated to a new second tier of super-conference leftovers, created in the next five years by ongoing conference realignment.

What are officially known as the Football Bowl Subdivision (I-A) and Football Championship Subdivision (I-AA) would each be cut down a tier under this scenario.

“There’s going to be another one,” said Fort, who got his doctorate from the California Institute of Technology in 1985 and has been at Michigan since 2007. “So when we start to talk about the FBS, and then the FCS, I think what we’re going to have is the FSS: the Football Super Series. So that will be five or six conferences, depending on how that shakes out eventually, and then there will be a new division.”

That new division, stuffed between Fort’s “FSS” and what is now I-AA, would be James Madison’s home. It would be comprised of what Fort described as the “remnant conferences” —  the American Athletic Conference (formerly the Big East), Conference USA and the Sun Belt — and full of schools passed over by the super leagues, excluded from the huge dollars those leagues generate.

The major conferences — the ACC, Big 12, Big Ten, Pac-12 and Southeastern Conference — each distribute roughly $20-$25 million to each member annually, and that number is projected to reach $40 million or more in the near future for at least the Big Ten. The money comes from the same place as realignment’s impetus: TV.

“That’s it. End of story,” said Skip Sauer, a professor of economics at Clemson who got his doctorate at the University of Washington. “…It’s college football TV money to be more precise about it. So … the affiliations in conferences have always been fluid because colleges are very competitive. They chase after the same students, same athletes, same outside foundations, same government grants. They are very competitive, so this has been going on a long time. But the TV money and the explosion of that has really taken over.”

Old Dominion, which is jumping to I-A Conference USA on July 1, received about $300,000 from the I-AA Colonial Athletic Association, and ODU athletic director Wood Selig said the Norfolk school, eventually, could earn nearly $3 million from C-USA.

Not bad, but still far from what the 63 major programs, including football independent Notre Dame, receive.

Fort said a hypothetical “FSS” could either be officially sanctioned or a de-facto division created by conference realignment.

“The impetus of this is the giant sucking upward sound of the big five conferences growing to exclude from postseason, from major postseason money, anybody else — either in the FBS or the FCS — to exclude them from getting the big money so they can continue to control it,” Fort said.

Fort isn’t alone in his new-classification theory.

In September 2011, JMU athletic director Jeff Bourne described a similar situation in which the major conferences consolidated into 16-team super leagues, leaving everyone else in the middle tier of three Division I classifications: a version of Fort’s FSS at the top, the leftover teams from I-A in the middle, and then I-AA at the bottom. JMU is positioned to be in that middle tier.

The school has a $34.5 million athletic budget, which is greater than a number of I-A schools, including Northern Illinois, the 2012 Mid-American Conference champion that played in the Orange Bowl for a roughly $17 million payout.

Madison has a 25,000-seat football stadium and averaged 22,783 fans per game in 2012 after averaging 25,002 in 2011, second to only App State (26,211) that year. JMU’s also already been a target of I-A leagues, notably the Sun Belt, a bottom-level I-A conference hit particularly hard by the trickle-down of realignment.

Conference USA has poached the Sun Belt of its better television markets (Florida Atlantic and Florida International are both in Miami), forcing the New Orleans-based league to go shopping for new members. JMU has little interest in joining the Sun Belt.

Right now, a popular and logical destination for JMU if it goes I-A is Conference USA. C-USA, based in Irving, Texas, is a better geographic fit (slightly) and will have one established rival — Old Dominion — for JMU to play. ODU also is lobbying for JMU to join.

Selig said he views C-USA as a potential stepping-stone to whatever major college football becomes in the future.

“I think it’s better to be at that level and in that room while policies are being shaped rather than it be dictated to you,” Selig said. “I think that’s important. I think being a FBS program will give us opportunities that no one can foresee at this time.”

Fort was skeptical.

He admitted that some schools — he pointed, notably, to South Florida — have success moving up from I-AA but said it’s very, very rare and very, very unlikely that an upstart I-A team would gain access to super-league money.

“Here’s the thing, right?” Fort said. “Why would you ever want to be FBS — and there’s a clear logic to it. The answer isn’t for all those other reasons: `We’ll get a chance at a bowl. We’ve got a shot at the BCS.’ No, don’t be dumb. You’re not going to a BCS game. You will occasionally get another bowl game, and they’re fun, but you’re not going to make any money at it.

“And what you really need to do is assess the relationship between James Madison football and James Madison University. The university wants to ask itself: `What is football worth to us?’ And it’s clearly worth something, or universities wouldn’t be doing this nationwide, top to bottom.”

There is appeal, and just because a school’s not at the highest tier doesn’t mean a I-A jump is a terrible idea.

Brian Goff, a professor of economics at Western Kentucky, said the long-term benefit to a school is something to consider. He said the startup costs of a I-A move even out over time, especially a stadium expansion, which he called a “35-40-year investment.” Other costs include more scholarships (I-AA football gets 63 and I-A gets 85), adding women’s scholarships to remain Title IX compliant and paying coaches more.

Selig said the I-A move, not considering Title IX or the 22 extra football scholarships, will cost Old Dominion about an extra $3 million on its $34.3 million athletics budget.

Goff, who got his doctorate from George Mason, said the exposure of I-A — more people on campus, more TV time, more potential students —  justifies the move.

“Your costs aren’t going up that much,” Goff said. “And your revenues are going to go up. You can see why schools are doing this.”

Selig said he anticipated ODU making about $1.5 million more per year. But FSS money? Probably not.

“Remember the rules are set in such a way and rigged in such a way to persevere that money for the top five conferences,” Fort said. “And the chance that’s going to happen to any other school for all intents and purposes is zero. You might as well go buy a lottery ticket.”


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