Ninety-four percent of approximately 365 Division I athletic programs spend more money than they take in, a stark financial reality that has pushed the University of Louisiana System to hire Deloitte for a $150,000 review of its athletics budget problems and a hard look at whether its eight member schools should abandon NCAA Division I.
UL System Orders $150,000 Deloitte Review on Division I Future
UL System President Rick Gallot announced the study during a Louisiana Board of Regents budget hearing, stating that nothing is off the table. Deloitte holds no limitations on its findings and recommendations. The review will explore whether member schools should retain their current NCAA status, move to a lower Division I subdivision, or drop entirely to Division II or III.
Other solutions could include capping coaches’ salaries or switching athletic conferences. Louisiana Tech recently moved from Conference USA to the Sunbelt Conference, where system peers UL Lafayette and UL Monroe already compete.
Millions in Deficits Expose Deep Regional Disparities
The UL System’s eight schools carry deficits totaling tens of millions of dollars, driven primarily by high travel and scholarship costs. While competing in Division I secures better media rights revenue, the financial gap forces universities to rely heavily on institutional funds.
A stark contrast exists within the system regarding financial self-sufficiency. Nicholls State University is currently the only state university athletics program that breaks even financially. Meanwhile, coaching salaries vary widely despite similar duties. Board of Regents member Wilbert Pryor noted at the budget hearing that a football coach at Louisiana Tech earns $1 million, while a coach at Nicholls State makes $250,000.
Weighing the Cost of Subdivisions and Lower Tiers
Dropping from the Football Bowl Subdivision to the Football Championship Subdivision would not necessarily solve financial troubles for schools like Louisiana Tech, UL Lafayette, and UL Monroe, as scholarship costs would remain high while broadcast revenues dropped. However, a move to Division II would lower scholarship and travel expenses, and Division III would eliminate scholarship costs entirely. Despite these potential savings, athletics administrators and university leaders expressed reluctance to leave Division I during interviews with the Illuminator this summer.
Demographic Pressures Threaten Student-Funded Budgets
Non-power conference schools rely on student support to cover athletic shortfalls. Students at these institutions contribute between $1,700 and $2,700 annually to their athletic departments through tuition and fees, according to the GAO report.
That reliance on student revenue faces a looming threat from demographic shifts in Louisiana. The state faces a shrinking population and declining birth rate, with college attendance projected to drop between 7.5% and 15% by 2029, according to a 2023 report from the Public Affairs Research Council.
Frequently Asked Questions
Which schools are part of the University of Louisiana System’s athletic programs?
The eight schools competing at the Division I level are Louisiana Tech, UL Lafayette, UL Monroe, Grambling, McNeese, Nicholls, Northwestern State, and Southeastern. Louisiana Tech, UL Lafayette, and UL Monroe compete in the Football Bowl Subdivision, while the remaining five compete in the Football Championship Subdivision.
How much does the Deloitte consulting study cost?
The financing study commissioned by the UL System costs $150,000, a figure Rick Gallot first announced at a Louisiana Board of Regents budget hearing.
What specific financial pressures are driving the review?
Athletic departments across the system carry deficits totaling tens of millions of dollars, fueled by high travel expenses and scholarship costs. At the same time, declining state birth rates and shrinking enrollment threaten the student tuition and fee revenues that currently subsidize 94% of Division I athletic programs nationwide.