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ERIC Number: EJ847114
Record Type: Journal
Publication Date: 2009-May-29
Pages: 1
Abstractor: ERIC
Reference Count: 0
ISSN: ISSN-0009-5982
Commercialization in College Sports May Have "Crossed the Line," Report Says
Wolverton, Brad
Chronicle of Higher Education, v55 n38 pA23 May 2009
Big-time college sports programs derive 60 percent to 80 percent of their revenue from commercial sources, suggesting that intercollegiate athletics--at least at the elite levels--may have "crossed the line" from an educational to a commercial endeavor. That finding comes from a report, "Tax Preferences for Collegiate Sports," released last week by the Congressional Budget Office. The office, a nonpartisan research arm of Congress, questioned whether the rise in such commercial ventures should lead big athletics programs to lose their tax-exempt status. The report offers no position, but it says removing the current tax incentives would do little to bring in additional revenue to the U.S. Treasury and would probably not alter the growing commercial activities in college sports. The NCAA has long argued that athletics departments are no different from other university programs that secure corporate deals to finance their operations. But the report found that athletics programs bring in a far greater proportion of their revenue from commercial sources than do colleges on the whole. Over all, colleges derive just 11 percent to 14 percent of their revenue from corporate deals. The report discusses a number of policy options that federal lawmakers could take, should they decide that college sports programs are too commercial in nature. Members of Congress could further limit the deduction of charitable contributions in athletics, which have helped finance much of the growth in college sports in recent years, or they could curtail athletics departments' use of tax-exempt bonds. If those tax breaks were eliminated, however, donors could simply shift their contributions to a university foundation, still earmarking them for sports. And if lawmakers prohibited the use of tax-exempt bonds to finance athletics facilities, colleges could borrow money for general needs and use the funds for sports. Some observers worry that imposing changes on the tax status of athletics departments, or limiting their revenue, could have unintended consequences, such as compelling programs to cut the sports more closely aligned with their educational mission in favor of breadwinners, and advocate for reshaping the tax code to encourage institutions, if they want to retain their contributions and deductions, to maintain their sports programs also.
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Publication Type: Journal Articles; Reports - Descriptive
Education Level: Higher Education
Audience: N/A
Language: English
Sponsor: N/A
Authoring Institution: N/A