Making Sense of the New Ticket Policy for Donors

Under the Tennessee Fund, the athletic department will assume central responsibility for the management of all athletic benefit priority programs, including the benefit program for those who contributed to non-athletic programs. -- July 2nd press release from the University of Tennessee

Last week, the University of Tennessee announced a change to the way tickets would be used as a reward for donations to academics.  Previously, donations given to specific academic departments would count and, if enough was given, the donor would receive the predefined benefits in terms of parking, season tickets, club seats, or whatever was deemed appropriate by the athletic department.  Now the donations must be given specifically to the Tennessee Fund (which is managed by the athletic department) rather than given to academic departments directly.  The Tennessee Fund will be used as a central hub to disperse athletic department support for academics.

It's an interesting idea on several levels.  Understandably, the initial reaction seems to be one of skepticism by the general fan base, and I think we would have heard a lot more discussion on this point if they hadn't made the press release on July 2nd - the day before a three-day holiday weekend.  The press release (opens in a new window here in pdf form) cites a more efficient distribution of money along with a more efficient (read: reduced) staff needed to manage the funds.  What people seem to  be worried about are the things that aren't being cited; namely, that this move gives the athletic department more control over the funds and limits the rewards that donors can receive when they give to their beloved departments.  (Note:  it doesn't prevent donors from giving to specific departments; it prevents them from giving to specific departments and receiving athletic event benefits for doing so.)

I've been tossing the idea around over the weekend, and what follows after the jump are my thoughts on the matter.

WHICH ACADEMIC DEPARTMENTS MIGHT BENEFIT, AND WHICH MIGHT NOT?

One of the immediate concerns that jumps out is the question of money recipients.  Who will get the money?  In the old system, the money tended to be received by the departments that the donors graduated from; i.e., the rich law, engineering, and business graduates tended to give back to their respective colleges.  Departments that tend not to produce many money-makers (e.g. humanities) usually didn't fare so well.  Under the new system, donated money is no longer earmarked toward specific colleges and the athletic department will control that decision.

I see two competing forces at work that will likely control the disbursements under the new structure.  First, the donors will likely keep track of how the athletic department gives money to academics.  There will still be some incentive to preferrentially give back to the colleges that the donors prefer simply as a way to encourage more giving in the future.  That may or may not be a significant incentive; I really have no idea how much the donors will worry about this.  Either way, I don't expect to hear much from it.

The second force at work is the ability of the athletic department to serve its own interests, and this is one I see as very influential.  Most of the donors may come from law, businees, and engineering, but most of the athletes will be found in arts and sciences - particularly for the cash cows of football and basketball.  With the Tennessee Fund, the athletic department will be able to funnel money toward the very departments that their athletes are involved in.  Doing so would not only endear those academic departments toward athletics (and I know for certain that many of the professors in the liberal arts departments envy athletics with a searing passion), but it would offer a form of control over the academics.  Think of this as the way the federal government used to regulate highway funds as a means to control the drinking age.  Technically, drinking age limits were the domain of the states, but with the exception of Louisiana, the feds maintain control by holding the highway money as a carrot to get the states to comply with their wishes.

In a Macchiavellian sense, the athletic department has just given themselves the ability to influence the departments that their athletes are most invested in.  Depending on how that influence is used (if at all), this may be good or bad, but the potential is now very real.  One good way to use the influence would be to create a more positive image for the athletic department; if the 'have-not' departments get more money from athletics, it becomes a little harder to hold a grudge.  An Alabama way of using the influence would be to use the money as leverage to get preferential treatment for the athletes:  Gee, we'd like to give you more money; if only John-Boy wasn't struggling so much...  Reality will be somewhere between - just hopefully far closer to the good end of the spectrum.

WHAT FACTORS ARE REALLY DRIVING THIS CHANGE?

I'm not an executive, but one thing I've found to be a terrific rule of thumb is that you never hear the real reasons why changes are made.  It's not as conspiratorial as it sounds; the real reasons changes are made are usually either mundane, mind-numbing technicalities or are negatives that people prefer not to publicize.  So in place of the driving forces, parallel benefits are announced along with the change.  For this reason, I always prefer to start by asking who is making the change, and then getting around to why.

Jan Simek, Hatchet Man

When the recession caused the state budget to shrink and the university felt the hit, one change (among many) that was made was the promotion of Dr. Jan Simek from the Anthropology department to interim president of the University.  Niceties aside, Simek was given the job for one principal reason - to find ways to trim the university's expenditures and make budget, no matter who was affected in the process.  The role of 'hatchet man' is not an enviable one, but is often necessary to get essential (and unpleasant) changes made.  After Simek finishes, he can then step back into Anthropology and a new president will take over without the burden of having made the ugly decisions.  It's all executive politics, really.

But back to Simek.  Simek's Anthropology background is relatively important, I think, in this affair.  He's a part of the 'have-nots' departments on campus - those who rely on state money and federal research dollars for their survival.  (In contrast, departments in engineering are loaded with professors who bring in their own research dollars in addition to the state and federal pipelines.)  There has always been a desire in the 'have-not' departments to slice off more of the pie for themselves, and they're not always tactful about it.  This is the point of view that Simek has been immersed in throughout his career.  Knowing this, it's not a stretch to guess that his motivation was to open up more funding for departments like his own.

Mike Hamilton, Business Man

Say what you will about Hamilton, he's a shrewd man.  Over the years, he's quietly trimmed what used to be a rather pork-bloated athletic department back to a much more sensible business structure.  The individual sports used to run their own little kingdoms, with a lot of redundant tasks being performed (for ticket sales and money management in particular), and the power of these mini-empires has slowly been siphoned away in favor of the athletic department as a whole.

But most of these efforts have involved changing the control structure within the athletic department.  This move does little in that regard.  (Note:  yes, it does affect disbursement of gifts like football and basketball tickets, but this is actually a minor impact.)  Instead, the Tennessee Fund changes the control structure around the athletic department.  Where donors once had very powerful influence over financial gifts to academics, that power is now in the hands of the athletic department.  Also, where the athletic department once had little control over academics, now they have a rather nice carrot to hang on a stick.

John Nolt, Thorn in the Side

For those who don't immediately recognize the name, John Nolt is the presiding President of the Faculty Senate.  (The new president will be Toby Boulet out of Mechanical Engineering, but he's not in charge quite yet.)  Nolt is a long-standing member of the Philosophy department and has had a knack for giving quotes that appear to display an embarrasing misunderstanding of how the athletic department works.  He's usually good for a once-a-semester screed in the Daily Beacon about how unfair it is that the athletic department gets so much money and how that money needs to be diverted to academics.  (Translation:  how dare the athletic department spend money that they earn and that is given to them rather than handing it over to us?)  To be fair, I can't imagine his stance is that silly, but the quotes certainly haven't helped his image.

But back to the story, there does exist a steady stream of complaints from the academic side of the house regarding the riches of the athletic side.  With the Tennessee Fund, while the source of the donations doesn't change (donors giving to academics due to athletic incentives), the appearance does.  Now it appears that the athletic department is giving much more generously to academics.  This can go a long way toward countering the complaints of the academic elites, even though the funding structure really isn't that different.  Instead of saying "donors give X dollars to academics to receive Y athletic benefits", they can now say "through the Tenenssee Fund, the athletic department gives X dollars to acadmics and returns Y athletic benefits to donors".

FURTHER CONSOLIDATION

What hasn't been mentioned much in this process is the consolidation within  the athletic department.  Other than a mention of the streamlining of donor benefits, it's not really being advertised that the formerly separate systems for football and basketball donation benefits are now being handled under the same umbrella.  This makes a lot of sense in terms of efficiency and is one more step in undoing the athletic fiefdoms that had grown in previous decades.  It's also very much in line with Hamilton's tenure, where nearly every move he's made (not including coaching hires) has been one of removing inefficiencies within the system.

Looking much deeper into the future, this can also simplify the process of consolidation the men's and women's athletic departments.  I haven't really discussed the Lady Vols side, but they are included in this transition just as much as the Vols.  And now that donor benefits for both the men's and women's programs are tied together, there really is very little standing in the way of a merger between the two departments.

AND SO...

There are a lot of reasons to be suspicious of what's going on.  It's obvious that athletics will gain more control over money (and the conspiracy theorists will love the new about the athletic department pledging more money to academics - and more money).  However, that's not always a bad thing; the logistics and administration of donations and benefits will be much simpler to handle and should help them avoid problems like the budget shortfall last year (where unmet pledges weren't properly accounted for in a timely manner).

There's a lot of behind-the-scenes I don't know here, but I see this as yet one more step in the consolidation of athletic departments - for better or for worse - and one more negotiating tool in the athletic department's shed when dealing with the academic side of the house.  From the perspective of the athletic department, this is a big winner so long as people don't quite donating money.  Their only worry will be that donors only give the minimum for the benefits they want, the give the rest to the departments of their choice directly; this would cause the Tennessee Fund to be less effective than advertised and would be seen as a negative change.

So make of it what you will.  Whether this is a 'good' or a 'bad' change will depend on how the athletic departments use their new carrot on a stick.

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