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  1. #1

    Athletic Endowment?

    I hope it doesn’t happen but there is a real risk that students won’t be allowed back on campus for the Fall Semester. Even the Spring Semester is at some risk. If this happens there won’t be athletics and the Duke Athletic Department is going to take a huge financial hit.

    Years ago, I heard that the Athletic Department had a large endowment, approaching $200 million IIRC. I never knew how much of that might have been spent on the football stadium and I haven’t heard anything about the athletic endowment in years. Does anyone have an idea of the status of the Athletic Department endowment? It would be nice to have a large endowment to fall back on in tough times.

  2. #2
    Join Date
    Nov 2007
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    Vermont
    Quote Originally Posted by hallcity View Post
    I hope it doesn’t happen but there is a real risk that students won’t be allowed back on campus for the Fall Semester. Even the Spring Semester is at some risk. If this happens there won’t be athletics and the Duke Athletic Department is going to take a huge financial hit.

    Years ago, I heard that the Athletic Department had a large endowment, approaching $200 million IIRC. I never knew how much of that might have been spent on the football stadium and I haven’t heard anything about the athletic endowment in years. Does anyone have an idea of the status of the Athletic Department endowment? It would be nice to have a large endowment to fall back on in tough times.
    I have no specific info on the athletic endowment, but do know that much of it is earmarked for specific purposes, e.g. endowed coaching salaries, etc, and they can't really tap that for shortfalls elsewhere.
    The good news is (and I've seen articles on this) every program in the country will feel the cash squeeze if football is affected...already some coaches at some schools are taking salary cuts.
    An AP article I saw today mentioned one AD who observed that of his hundreds of employees (coaches, administration) 75% of the salary money goes to a relatively small group of people, I think 20% or so.

  3. #3
    Join Date
    Feb 2007
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    Steamboat Springs, CO
    Quote Originally Posted by hallcity View Post
    I hope it doesn’t happen but there is a real risk that students won’t be allowed back on campus for the Fall Semester. Even the Spring Semester is at some risk. If this happens there won’t be athletics and the Duke Athletic Department is going to take a huge financial hit.

    Years ago, I heard that the Athletic Department had a large endowment, approaching $200 million IIRC. I never knew how much of that might have been spent on the football stadium and I haven’t heard anything about the athletic endowment in years. Does anyone have an idea of the status of the Athletic Department endowment? It would be nice to have a large endowment to fall back on in tough times.
    the Duke Forward campaign, which ended in 2017, raised $340 million for athletics. This would normally be endowments funds (and includes some pledges, to be sure).

    More generally, The Duke University Endowment was $8.6 billion as of last June 30 (and that doesn't include pledges). That doesn't count The Duke Endowment, the original trust created by James B. Duke. It was worth $3.6 billion as of 2018 -- about one-half of its gifts go to Duke U. The two funds are managed as a single entity for investment purposes. Who knows what hits have occurred recently?

    I wouldn't assume that endowment funds would be readily converted to current operations. Many, however, of the athletic pledges and funds were for scholarships -- which is a major expense and part of current operations.
    Sage Grouse

    ---------------------------------------
    'When I got on the bus for my first road game at Duke, I saw that every player was carrying textbooks or laptops. I coached in the SEC for 25 years, and I had never seen that before, not even once.' - David Cutcliffe to Duke alumni in Washington, DC, June 2013

  4. #4
    Quote Originally Posted by hallcity View Post
    I hope it doesn’t happen but there is a real risk that students won’t be allowed back on campus for the Fall Semester. Even the Spring Semester is at some risk. If this happens there won’t be athletics and the Duke Athletic Department is going to take a huge financial hit.

    Years ago, I heard that the Athletic Department had a large endowment, approaching $200 million IIRC. I never knew how much of that might have been spent on the football stadium and I haven’t heard anything about the athletic endowment in years. Does anyone have an idea of the status of the Athletic Department endowment? It would be nice to have a large endowment to fall back on in tough times.
    Athletics will take a hit as will the rest of the university even under the best of scenarios. As noted- most endowments have limited.flexibility and as noted 80% of the budget is for people. A $200M endowment yields 5% to the operating budget. In principle, those who gave gifts that are invested in the endowment can allow Duke to redirect or even dip into the principal. But if students stay home next fall or next year- and Duke is absent that revenue or even 1/2- it will be a tough year for many- likely furloughs or firings. Duke recovers about 500M from tuition a year. May be able to survive 1 year but it will be a hit.

  5. #5
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    Oct 2009
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    Durham
    Quote Originally Posted by dukelifer View Post
    Athletics will take a hit as will the rest of the university even under the best of scenarios. As noted- most endowments have limited.flexibility and as noted 80% of the budget is for people. A $200M endowment yields 5% to the operating budget. In principle, those who gave gifts that are invested in the endowment can allow Duke to redirect or even dip into the principal. But if students stay home next fall or next year- and Duke is absent that revenue or even 1/2- it will be a tough year for many- likely furloughs or firings. Duke recovers about 500M from tuition a year. May be able to survive 1 year but it will be a hit.
    duke is not losing tuition revenue here. Students are still paying what they were in that regard, and will be lined up to pay again in the fall, even if the semester starts, or is totally remote.
    1200. DDMF.

  6. #6
    Quote Originally Posted by uh_no View Post
    duke is not losing tuition revenue here. Students are still paying what they were in that regard, and will be lined up to pay again in the fall, even if the semester starts, or is totally remote.
    Hard to know how it will play out- but Duke will take some financial hits even if tuition stays steady- probably decreases in federal grants - losses in housing revenues and losses in endowment income. All those add up .

  7. #7
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    Oct 2009
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    Durham
    Quote Originally Posted by dukelifer View Post
    Hard to know how it will play out- but Duke will take some financial hits even if tuition stays steady- probably decreases in federal grants - losses in housing revenues and losses in endowment income. All those add up .
    undoubtedly. but tuition was specifically cited, and that's one of the things that will almost assuredly NOT be going down (and if the board does what the board does, we'll see a 3-5% increase in tuition! how jolly to have 0 price elasticity)
    1200. DDMF.

  8. #8
    Quote Originally Posted by uh_no View Post
    undoubtedly. but tuition was specifically cited, and that's one of the things that will almost assuredly NOT be going down (and if the board does what the board does, we'll see a 3-5% increase in tuition! how jolly to have 0 price elasticity)
    In 2008 - Duke had to dole out more in financial aid- there also may be a fraction of students who choose to take a “leave of absence” and take some online courses at other institutions with cheaper tuition and have then transfer those credits. Duke will have to be flexible with the fact that some families may have taken huge financial hits. The tuition won’t go down but the tuition received may.

  9. #9
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    Vermont
    Well, one thing that is undeniably true is that, should football season be canceled, we would be far less affected by the revenue loss of ticket sales than the vast majority of FBS schools...Michigan will lose 100k fans per game, we'll lose more like 18k I'd guess (counting season ticket sales)...

  10. #10
    Quote Originally Posted by budwom View Post
    Well, one thing that is undeniably true is that, should football season be canceled, we would be far less affected by the revenue loss of ticket sales than the vast majority of FBS schools...Michigan will lose 100k fans per game, we'll lose more like 18k I'd guess (counting season ticket sales)...
    And our tickets are much much cheaper, let me tell you..even students at Michigan have to pay for seats although theirs are cheaper than the masses certainly.

  11. #11
    the Iowa State AD used the term "ice age" to describe the effect on college athletic budgets if the 2020 football season doesn't happen. Iowa State has an $87 million budget, of which $12 million comes from football ticket sales and $34 million from football related TV money.



    https://bleacherreport.com/articles/...on-is-canceled

  12. #12
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    Feb 2007
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    Watching carolina Go To HELL!
    Just a reminder, if you're waiting to renew your season tickets until just before the end of the "cheapest period", that's just over a week away. Tickets are no longer cheap if you sit in reserved seats under cover, and haven't been since the renovations to Wally Wade were complete. But prices go up in 10 days. If the season is cancelled, I would hope that Duke would refund the ticket cost.
    Ozzie, your paradigm of optimism!

    Go To Hell carolina, Go To Hell!
    9F 9F 9F
    https://ecogreen.greentechaffiliate.com

  13. #13
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    Quote Originally Posted by OZZIE4DUKE View Post
    Just a reminder, if you're waiting to renew your season tickets until just before the end of the "cheapest period", that's just over a week away. Tickets are no longer cheap if you sit in reserved seats under cover, and haven't been since the renovations to Wally Wade were complete. But prices go up in 10 days. If the season is cancelled, I would hope that Duke would refund the ticket cost.
    some of us were guessing that they'd want to use the money to pay for next season's tickets...but that's only a guess...

  14. #14
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    Quote Originally Posted by uh_no View Post
    ... will be lined up to pay again in the fall, even if the semester starts, or is totally remote.
    Will they? IMHO, the new normal will experience a sea change from the old normal. Aren't parent's going to realize that paying $5000 for a music appreciation course or a communicating with animals course is a terrible value? If I were in the higher education business, I'd be very worried.

  15. #15
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    Quote Originally Posted by 4Gen View Post
    Will they? IMHO, the new normal will experience a sea change from the old normal. Aren't parent's going to realize that paying $5000 for a music appreciation course or a communicating with animals course is a terrible value? If I were in the higher education business, I'd be very worried.
    That will certainly be a challenge for a number of colleges and universities, but it won't be for Duke and its ilk...parents are buying their kids a coveted credential at Duke, the Ivies, Stanford, NW, other top tier schools. Demand will still be absolutely enormous.

  16. #16
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    I think you're right, initially. But online courses will eventually disabuse parents of the value of $50,000 tuitions, especially for BS (not to be confused with Bachelor of Science) courses. I mean, the Cheats sold hallucitory courses for 20 years, and as they proudly argued, not to just athletes. The new normal will cause parents, and employers, to wise up more quickly.

  17. #17
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    Quote Originally Posted by budwom View Post
    That will certainly be a challenge for a number of colleges and universities, but it won't be for Duke and its ilk...parents are buying their kids a coveted credential at Duke, the Ivies, Stanford, NW, other top tier schools. Demand will still be absolutely enormous.
    I believe the correct term -- sniff, sniff -- is "Ivy Plus." Duke plus the eight Ivy League schools plus Stanford plus U. of Chicago.
    Sage Grouse

    ---------------------------------------
    'When I got on the bus for my first road game at Duke, I saw that every player was carrying textbooks or laptops. I coached in the SEC for 25 years, and I had never seen that before, not even once.' - David Cutcliffe to Duke alumni in Washington, DC, June 2013

  18. #18
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    Quote Originally Posted by 4Gen View Post
    Will they? IMHO, the new normal will experience a sea change from the old normal. Aren't parent's going to realize that paying $5000 for a music appreciation course or a communicating with animals course is a terrible value? If I were in the higher education business, I'd be very worried.
    duke had 41,500 applicants last year for 1,700 spots. Unless 40,000 people change their mind, the line is plenty long.

    Small liberal arts colleges? Sure (but they've been having trouble the past decade before this).
    1200. DDMF.

  19. #19
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    ^ though the top small liberal arts colleges find themselves as popular as ever...schools like Williams, Amherst, Middlebury, Tufts, etc are still wildly popular, have all the applicants they'll need...but for sure many of the less prestigious schools are struggling...

  20. #20
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    Quote Originally Posted by sagegrouse View Post
    I believe the correct term -- sniff, sniff -- is "Ivy Plus." Duke plus the eight Ivy League schools plus Stanford plus U. of Chicago.
    Sorry, I left out MIT -- there are twelve universities in the informal Ivy Plus grouping. The elite smaller schools are every bit as selective but in a different category, and BudWom mentioned some of them above.
    Sage Grouse

    ---------------------------------------
    'When I got on the bus for my first road game at Duke, I saw that every player was carrying textbooks or laptops. I coached in the SEC for 25 years, and I had never seen that before, not even once.' - David Cutcliffe to Duke alumni in Washington, DC, June 2013

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