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Chronicle of Higher Ed Details Big Ten SAF Spending

The NCAA’s $75 million Student Assistance Fund is one of the shining examples of the NCAA, almost unimpeachable. It is the easiest thing to point to if you want to argue that the NCAA will do college athletics better than anyone else. Compare it to the BCS and whatever will follow, which earmarks exactly $0 for athletes. The SAF is hard to screw up.

But a number of Big Ten schools managed to do it, by either spending the money on impermissible uses, retaining too much of the money, or in the worst cases, relying on the NCAA to pay expenses which the school is allowed to pay for through other means. Brad Wolverton of the Chronicle of Higher Education detailed the spending from an NCAA document (subscription req’d).

Iowa spend $9680 of SAF funds on impermissible expenses in violation of NCAA rules. SAF funds were used to pay for administrator travel, paper shredding, and displays in athletic facilities. Iowa said this was an administrative oversight and repaid the money back into the SAF account. So at least there was no loss of funds available to athletes in this case.

The Big Ten also has a large reserve or surplus of SAF money, totaling $2.1 million after the 2011–12 academic year, about $175,000 per school. A Student Assistance Fund reserve is a tricky thing. On the one hand, money not spent is money that cannot possibly benefit student-athletes. On the other hand, holding money in reserve means the institution can respond to one-time events, like natural disasters that destroy all of a student-athlete’s possessions. But $175,000 in reserve is more than many schools without football receive in total SAF money each year.

But one of the poorest uses of the fund comes from Ohio State, although why this is so bad is hard to see at first:

Years ago Ohio State surveyed its players to find out how they wanted the money spent. The top two responses: health insurance and parking.

Ohio State now uses the fund to pay half the cost of its athletes’ health insurance, Mr. Archie said. And last year the university bought parking permits for 126 students, the Big Ten document shows, for a total of $25,856.

Wolverton’s article questions the parking permits, which essentially means money goes back to the university, but that is defensible. That would be money out of the students’ pockets, so they receive a benefit, even if the university keeps the money.

It is the health insurance that’s the real problem. All because of this:

Bylaw 16.4.1 – Permissible.

Identified medical expense benefits incidental to a student-athlete’s participation in intercollegiate athletics that may be financed by the institution are:
(a) Medical insurance;

The Student Assistance Fund is a limited pot of money that can pay for things which schools cannot, like travel, clothing, and school supplies. But since the White case was settled in 2008, schools can pay for any health insurance for athletes, not just insurance that covers their injuries from participating in athletics.

Now it is not safe to assume that just because Ohio State is Ohio State, it has money to burn. But a few numbers say that it probably had money for this. Ohio State’s EADA report for 2011–12 showed a $25 million operating surplus. But that seems overstated, and may not include roughly $16 million of capital expenses. That makes sense given that USA Today’s database shows Ohio State with a $9 million surplus the year prior. But the most critical piece is this from Kristi Dosh about Ohio State’s 2011–12 budget:

Every single sport at Ohio State is receiving an overall increase in their expense budget for 2011–2012. The percentage of increase ranges from 0.9% (Women’s Cross Country) to 9.4% (Women’s Soccer).

That means Ohio State is choosing to fund an across-the-board spending increase, rather than spending budget dollars on health insurance for student-athlete. It is then using SAF funds to cover the health insurance. That reduces the amount of money available for things that only the Student Assistance Fund can pay for.

The NCAA could fix many of these issues by requiring that the Student Assistance Fund only be used for things that cannot be funded any other way. Otherwise the fund will continue to be used to supplement an athletic department’s budget, which is not the intended purpose.

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