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Did Duke Basketball Really Lose $2 Million?

It's the only numbers us reporters get to see out in the open: The Equity in Athletics Disclosure Act. It requires all athletic institutions, both public and private to file an annual report to the Department of Education so that schools can be checked on how they are complying with rules of gender equity (Title IX).

The reports, on the surface, appear to be fairly detailed.

For a school like Duke, the latest report—filed for the 2008-09 season—will tell you that the athletic department spent $13.3 million on student aid, slightly more than $1 million on recruiting and nearly $4 million on assistant coaches salaries.

Duke Head coach Mike Krzyzewski directs his team during last year's NCAA Men's Basketball Tournament.
Photo: Streeter Lecka | Getty Images
Duke Head coach Mike Krzyzewski directs his team during last year's NCAA Men's Basketball Tournament.


But the school also told the government that its basketball program had $13.87 million in expenses and only pulled in $11.84 million in revenue. That's good for a loss of more than $2 million.

First, let's put this all in context.

Rarely does any tournament team report that its basketball team lost money and Duke's filing certainly suggests that the team did spend more than others in expenses. Duke says it spent $394,068 per basketball player for the 2008-09 season. I couldn't find any of this year's tournament teams that spent more than $175,000 per player. It's ACC counterpart Maryland, for example, said it spent $45,000 per player. Why a Duke player costs more than eight times more, I'm still not sure.

The next guess is that the salary of the head coach Mike Krzyzewski is bogging down the numbers. Well, that's not really it either. Remember, plenty of his salary does come from outside the university and Duke, in the same report, said it spent only $6.5 million on all its men's sports head coaches last year.

The real answer is that, while Duke's spending per player does seem to be extraordinarily high when compared to the rest of college basketball, the program in reality did not lose $2 million last year. We have good sources that say the team was fairly well into the green.

The Equity in Athletics Disclosure Act is useful because it's all we have, but it's not a complete accounting of an athletic department's budget. Its purpose is to make sure schools are balancing out their commitment to men's and women's sports. The government does not ask for a breakdown, for example, of fundraising from boosters or a breakdown of licensing royalties in per program (you can bet that more than 80% of Duke athletics licensing royalties would be attributed to basketball alone).

That all being said, it's still hard to figure out how the Blue Devils could even be in a position to show a loss. Even East Tennessee State said it pulled in $298,000 last year.

Questions? Comments? SportsBiz@cnbc.com

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