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The 2019-2020 SWAC/MEAC Athletic Financial Review

In the fourth HBCU Money report on the SWAC/MEAC’s athletic finances, there has been one trend that is consistent – an acute amount of red on the balance sheet of each respective HBCU as it pertains to their athletic departments and it continues to grow redder and redder. Since HBCU Money first began reporting the SWAC/MEAC Athletic Financial Review, there have been losses of $128.6 million (2014-2015), $147.1 million (2016-2017), $150.7 million (2017-2018), and this year they continue their trend of the athletic black hole with losses over $161 million through athletics with no correction in sight. Not exactly the cash generating juggernauts that HBCU alumni have in mind when it comes to how deeply many believe that athletics can be the financial savior to HBCU financial prosperity. Instead, athletics seems to be potentially at the crux of many HBCU financial woes. Almost unfathomable is that many in the SWAC/MEAC have athletic budgets higher than their research budgets.

The harsh reality is that even with all the popularity buzz generated by Jackson State University’s head football coach, Deion Sanders, the factors working against HBCU athletics ever achieving real profitability remains a pipe dream at best. To land a major television contract, which is the only reason on mass that the SEC and Big 10 are the profitable athletic programs they are requires something that HBCU alumni bases severely lack. Large fan bases that have high incomes and an affluence. The harsh reality that HBCUs have small alumni bases, a reality that has been exacerbated post-desegregation where now HBCUs only get 9 percent of African Americans in college, combined with African America having both the lowest median income and wealth do not make for a recipe for advertisers to pay top dollar to television stations who would then healthily compensate HBCU institutions. HBCU athletics can be profitable, but it requires a completely different business model than our PWI counterparts. See, “The 5 Steps To HBCU Athletic Profitability”.

HBCU athletic revenues went down while expenses and subsidies went up in 2019-2020. That is usually a trend all would prefer be flipped. Students continue to bear the brunt of generating HBCU athletic revenues. This year’s review shows that approximately 73 percent of HBCU athletic revenues are generated through subsidies, up from 70 percent the year prior. Something to consider when 90 percent of HBCU students graduate with student loan debt.

REVENUES (in millions)

Total: $200.4 (down 1.2% from 2017-2018)

Median: $10.3 (down 4.6% from 2017-2018)

Average: $10.6  (up 5.0% from 2017-2018)

Highest revenue: Prairie View A&M University  $18.7 million

Lowest revenue: Coppin State University  $2.8 million

EXPENSES (in millions)

Total: $213.0 (up 0.5% from 2017-2018)

Median: $12.5 (up 15.7% from 2017-2018)

Average: $11.2 (up 5.7% from 2017-2018)

Highest expenses: Prairie View A&M University  $18.7 million

Lowest expenses: Mississippi Valley State University  $3.9 million

SUBSIDY

Total: $148.4 (up 4.9% from 2017-2018)

Median: $6.4 (down 18.4% from 2017-2018)

Average: $7.1 (unchanged from 2017-2018)

Highest subsidy: Prairie View A&M University $15.5 million

Lowest subsidy: Coppin State University $1.7 million

Highest % of revenues: Delaware State University: 92.0%

Lowest % of revenues: Florida A&M University: 37.0%

PROFIT/LOSS (W/ SUBSIDY)

Total: $-12.7 million (down 40.0% from 2017-2018)

Median: $0 (up 100.0% from 2017-2018)

Average: $-666,295 (down 46.3% from 2017-2018)

Highest profit/loss: North Carolina A&T State University  $615,094

Lowest profit/loss: North Carolina Central University  $-6,264,082

PROFIT/LOSS (W/O SUBSIDY)

Total: $-161.0 million (down 6.8% from 2017-2018)

Median: $-9.8 million (down 40.0% from 2017-2018)

Average: $-8.5 million (down 13.3% from 2017-2018)

Highest profit/loss: Mississippi Valley State University  $-2,177,123

Lowest profit/loss: Prairie View A&M University  $-15,417,471

CONCLUSION: At current, it would take an approximately $4.3 billion endowment dedicated to athletics to ween the SWAC/MEAC off of these subsidies onto a sustainable path. A sum greater than all HBCU endowments combined. Perhaps through merchandise sales, Jackson State could see its way to profitability without subsidies. Perhaps, but as former HBCU alumnus and NFL Hall of Famer Shannon Sharpe recently said, “There is only one Deion Sanders”. One thing is for certain, HBCUs have not done a proper cost-benefit analysis for the money they spend and subsidize to their athletic departments nor have they explored potential alternative models.

Editor’s Note: Howard and Bethune-Cookman are excluded in this report because they are private institutions and their athletic finances were not included in this report.

Source: USA Today

HBCU Money’s 2021 Top 10 HBCU Endowments

If there was a short analysis of the 2021 HBCU endowment list it would be this – still not enough. Despite record breaking donations toward HBCUs from Mackenzie Scott and others in 2020-2021, the PWI-HBCU endowment gap among the Top 10 PWIs and HBCUs continues to balloon, a gap that stands at a staggering $121 to $1. This despite a 35 percent increase by the Top 10 HBCU endowments from last year. Simply put, winning the philanthropic “lottery” is not enough and it never will be when it comes to closing the endowment gap. The rabbit never beats the tortoise to put it another way. HBCUs must find a way to find consistent capital infusions over time as opposed to lighting quick one-offs.

The HBCU donor pool is simply too small and too poor (relatively speaking) to close the endowment gap. Without increasing the percentage of African Americans college students who go to HBCUs from 10 percent to 25-30 percent, it does not bode well for HBCUs to be able to close the endowment gap through traditional means. HBCUs and their alumni are going to have to be more creative and must be so expeditiously. While this is the most HBCU endowments we have ever reported with $100 million or greater, increasing from five in 2020 to seven in 2021, PWIs saw an 25 percent increase in the number of endowments over $2 billion going from 55 to 69 and an equally 25 percent rise in the number of endowments over $1 billion going from 114 to 142. This while HBCUs are still waiting for their first billion dollar endowment.

To that point, the race between Howard and Spelman is tightening. Last year’s $334 million lead that Howard held over Spelman has shrunk to $265 million. At one point it seemed a foregone conclusion that Howard would reach the milestone first (The Race To The First Billion Dollar HBCU Endowment: Can Anyone Catch Howard?), that is no longer the case. Howard’s public relations over the past year have not been favorable and while many people say all press is good press – not when you are an African American institution. With Hampton and North Carolina A&T’s departure from the MEAC, no HBCU conference (CIAA, GCAC, MEAC, SIAC, SWAC) is dominating the Top 10 and the list is split 50/50 between private and public HBCUs as well. Arguably this is the most diverse Top 10 HBCU endowment list since we first began publishing, but one thing remains feverishly consistent and that is there is a lot of work to be done to ensure HBCU endowments and therefore the institutions of HBCUs are sustainable and thriving.

HIGHLIGHTS:

  • Top 10 HBCU Endowment Total – $2.7 billion
  • Top 10 PWI Endowment Total – $328.7 billion
  • Number of PWIs Above $2 billion – 69
  • Number of PWIs Above $1 billion – 142
  • HBCU Median – $97.8 million (33.7%)
  • NACUBO Median – $200.4 million (25.8%)
  • HBCU Average – $203.8 million (53.6%)
  • NACUBO Average – $1.2 billion (35.2%)

All values are in millions ($000)*

1. Howard University – $795,203 (11.6%)

2. Spelman College – $530,399 (40.3%)

3.  Hampton University – $379,992 (35.4%)

4.  Morehouse College – $278,073 (77.0%)

5.  Meharry Medical College – $186,943 (19.3%)

6. North Carolina A&T State University  – $157,336 (113.2%)

7. Florida A&M University – $118,635 (24.4%)

8. Morgan State University$97,783 (162.9%)

9. Tennessee State University – $91,120 (33.2%)

10. The University of the Virgin Islands – $82,863 (23.9%)

OTHERS REPORTING:

*The change in market value does NOT represent the rate of return for the institution’s investments. Rather, the change in the market value of an endowment from FY20 to FY21 reflects the net impact of:
1) withdrawals to fund institutional operations and capital expenses;
2) the payment of endowment management and investment fees;
3) additions from donor gifts and other contributions; and
4) investment gains or losses.

SOURCE: NACUBO

Take a look at how an endowment works. Not only scholarships to reduce the student debt burden but research, recruiting talented faculty & students, faculty salaries, and a host of other things can be paid for through a strong endowment. It ultimately is the lifeblood of a college or university to ensure its success generation after generation.

HBCU Money’s 2020 Top 10 HBCU Endowments

For the first time since we began reporting the Top Ten HBCU endowments, an HBCU endowment that we knew should be present but was not reporting is now present – Morehouse College. Hopefully next year we will see Tuskegee University join the fray. This provides a far more accurate picture of the HBCU endowment picture, at least at the top. While many will wonder why the endowments do not appear larger after massive donations that happen in 2020, it should be understood that many donations will not be reflective in the institutions endowment figures until fiscal year 2021 is reported so expect to see massive jumps for many HBCUs in the next calendar year.

However, examining the HBCU endowment world prior Mackenzie Scott’s 2020 philanthropy shows Howard University powering ahead toward becoming the first HBCU endowment to $1 billion. Their lead over number two Spelman extended from $302 million in 2019 to $355 million in 2020. Unfortunately, only four of the ten HBCU endowments saw increases in their endowment market value, while amongst the PWI’s Top Ten endowments all ten saw increases in their market value.* The Top Ten PWI endowments for 2020 combined for $199.8 billion versus $2 billion for the Top Ten HBCU endowments showing an institutional wealth gap of almost $100 to $1.

There is going to be a continued mixed bag of endowment reality among HBCUs. The Have and Have Nots among HBCU endowments has exacerbated and despite the attention during 2020 most smaller HBCUs have yet to secure donations that would secure their future. Even many of those who did are still sitting in a precarious perch. The NACUBO average endowment is over $907 million, an amount that is almost five times the average HBCU endowment and an average that not even Howard has reached yet. This means that while the “lottery” donations from non-HBCU sources is great, it absolutely does not remove the charge from HBCU alumni of being vigilant givers to their institutions. If HBCUs could simply get more of their alumni giving small amounts on a consistent basis that would do wonders for improving endowments. It goes without saying the other reality is that all HBCUs need to increase their student populations so that they are graduating more alumni and therefore more potential donors.

HIGHLIGHTS:

  • HBCU Endowment Total – $2.0 billion
  • Number of PWIs Above $2 billion – 55
  • Number of PWIs Above $1 billion – 114
  • HBCU Median – $95.6 million (-2.62%)
  • NACUBO Median – $165.7 million (0.58%)
  • HBCU Average – $187.7 million (0.13%)
  • NACUBO Average – $903.1 million (1.56%)

All values are in millions ($000)

1. Howard University – $712,410 (2.83%)

2. Spelman College – $377,942 (-3.21%)

3.  Hampton University – $280,598 (-0.69%)

4.  Morehouse College – $157,081 (0.64%)

5.  Meharry Medical College – $156,719 (-1.53%)

6. Florida A&M University – $95,635 (-2.63%)

7. North Carolina A&T State University  – $73,809 (7.82%)

8.  University of the Virgin Islands – $66,894 (-6.68%)

9. Tennessee State University – $63,020 (3.12%)

10. Virginia State University – $56,149 (-2.15%)

OTHERS REPORTING:

*The change in market value does NOT represent the rate of return for the institution’s investments. Rather, the change in the market value of an endowment from FY19 to FY20 reflects the net impact of:
1) withdrawals to fund institutional operations and capital expenses;
2) the payment of endowment management and investment fees;
3) additions from donor gifts and other contributions; and
4) investment gains or losses.

SOURCE: NACUBO

Take a look at how an endowment works. Not only scholarships to reduce the student debt burden but research, recruiting talented faculty & students, faculty salaries, and a host of other things can be paid for through a strong endowment. It ultimately is the lifeblood of a college or university to ensure its success generation after generation.

HBCU Money’s 2019 Top 10 HBCU Endowments

The adjective that best describes 2019 HBCU endowments – uninspiring. HBCU flagship endowments barely moved over the past calendar year. Of all reporting endowments, only The University of the Virgin Islands saw double digit gains in their endowment market value. Since breaking into the top 10 HBCU endowments in 2014, UVI has been on a meteoric rise almost doubling their endowment over the past six years and has become something of a canary in a coal mine.

There is plenty of blame to go around, but the jest of the matter is HBCUs and HBCU alumni associations continue to not do a good enough job of hammering financial and philanthropic literacy among their constituents. This leads to either a lack of investing or no investing at all among HBCU alumni and HBCU alumni associations and therefore a paltry engagement both from an alumni giving rate and alumni giving amounts. Simply put, there are still far too many HBCU alumni and students who do not know what an endowment is or its purpose and it is reflected in the endowments of our institutions.

If there is any solace to be taken from this year’s numbers, it is that HBCU endowments are largely in line with the overall sentiment of America’s college and university endowments. Unfortunately, the median HBCU endowment is less than 44 percent of the overall NACUBO median reporting endowment and HBCU endowments are just barely 18 percent of the NACUBO average reporting endowment.

HIGHLIGHTS:

  • HBCU Endowment Total – $2.1 billion
  • Number of PWIs Above $2 billion – 54
  • Number of PWIs Above $1 billion – 108
  • HBCU Median – $64.8 million (4.07%)
  • NACUBO Median – $149 million (5.02%)
  • HBCU Average – $148 million (4.25%)
  • NACUBO Average – $816.4 million (4.24%)

All values are in millions ($000)

1. Howard University – $692,832 (0.62%)

2. Spelman College – $390,462 (0.27%)

3.  Hampton University – $282,543 (-0.98%)

4.  Meharry Medical College – $159,146 (-0.48%)

5.  Florida A&M University – $98,213 (1.93%)

6.  University of the Virgin Islands – $71,684 (15.83%)

7. North Carolina A&T State University  – $68,459 (7.58%)

8.  Tennessee State University – $61,110 (4.11%)

9. Virginia State University – $57,383 (5.33%)

10.  Winston-Salem State University – $49,755 (7.66%)

OTHERS REPORTING:

Take a look at how an endowment works. Not only scholarships to reduce the student debt burden but research, recruiting talented faculty & students, faculty salaries, and a host of other things can be paid for through a strong endowment. It ultimately is the lifeblood of a college or university to ensure its success generation after generation.

Source: NACUBO

HBCU Money™ Presents: 2019’s HBCU Alumni NFL Players & Salaries

The 6th annual installment of tracking the earnings of HBCU alumni who are NFL players, the University of Arkansas-Pine Bluff’s Terron Armstead retains the crown with a $5.5 million raise over his 2018 salary.

HBCU Money™ FACTS:

  • HBCU NFL players combine for $43.6 million, an almost 13 percent increase from 2018, when HBCU NFL players earned $38.7 million.
  • South Carolina State University & North Carolina A&T are tied with 4 NFL players each.
  • The SWAC has 9 players versus the MEAC’s 12 players in the league.
  • Average salary for HBCU NFL players is $1.9 million, an increase of $100,000 from 2018.
  • Median salary for HBCU NFL players is $930,000.
  • HBCU players account for 1.4 percent of the NFL’s 32 team active roster spots.
  1. Terron Armstead /UAPB / $15.8 million
  2. Antoine Bethea / Howard / $3.625 million
  3. Chester Rogers / Grambling State / $3.095 million
  4. Joe Thomas / South Carolina State / $2.237 million
  5. Tytus Howard (R) / Alabama State / $2.223 million
  6. Javon Hargrave / South Carolina State / $2.198 million
  7. Rodney Gunter / Delaware State / $1.75 million
  8. Ryan Smith / North Carolina Central /$1.697 million
  9. Darius Leonard / South Carolina State / $1.647 million
  10. Isaiah Crowell / Alabama State / $1.25 million
  11. Antonio Hamilton / South Carolina State / $1 million
  12. Brandon Parker / North Carolina A&T / $930,758
  13. Tarik Cohen / North Carolina A&T / $803,914
  14. Grover Stewart / Albany State / $749.912
  15. Tony McRae / North Carolina A&T / $645,000
  16. KhaDarel Hodge / Prairie View A&M / $570,000 (Tied)
  17. Trent Scott / Grambling State / $570,000 (Tied)
  18. Darryl Johnson / North Carolina A&T / $519,522
  19. Joshua Miles / Morgan State / $513,664
  20. Trent Cannon / Virginia State / $511,096
  21. Danny Johnson / Southern / $510,862
  22. Jamie Gillan / UAPB / $498,333
  23. Da’Lance Turner / Alcorn State / $268,235