These days there is a lot of talk about the huge amount of money involved in college sports. From reports of players unionizing to arguments about whether student-athletes should be paid to claims that student-athletes can’t even get enough food, money seems to dominate the discussion of college sports these days. This makes sense as the amount of money involved is huge, Ohio State’s athletic department brings in over $140 million in revenue and Urban Meyer and Thad Matta both get paid more than $3 million a year while athletic director Gene Smith earns more than $1 million a year.
The amount of money involved in college athletics is truly huge and many people worry that this amount of money has a corrupting influence on universities, causing them to make decisions that benefit athletics at the expense of the academic mission of the university. While there are certainly instances of this happening, see the academic scandal at North Carolina for example, the amount of money involved in college athletics is far from the largest source of revenue for most universities. If you look at Ohio State’s budget numbers for the 2014 fiscal year, the university’s total income for the year is $5.25 billion dollars, the largest source of that being the OSU hospitals and health system which are also the largest expense. After that, OSU’s next largest source of income is student tuition and fees which bring in $962 million and then government funding which provides $957 million in total.
The other major source of income for the university is research funding which will be the main focus of today’s article, continuing in the recent theme of my Friday articles looking at the academic side of OSU. Ohio State is one of the largest research universities in the world, conducting important research across a broad range of topics that impact the world in a variety of ways. For the 2013 fiscal year, OSU had $967 million in total research expenditures, a number that has grown immensely over the last decade. In 2004, OSU’s total research expenses were $518 million, just more than half of the current number, and research spending has risen in 9 of the last 10 years.
OSU’s research funding comes from a variety of sources, which are included in various categories in the numbers from the budget office, but the largest source is grants from federal agencies which totaled over $480 million in 2013; industry-sponsored research added another $111 million in funding. The National Institute of Health is the leading federal agency funding research at OSU, not surprising considering the quality and size of the OSU health system, contributing over $200 million a year. The National Science Foundation provides over $50 million in research funding while the Department of Defense and the Department of Education provide over $30 million each; the Department of Agriculture and the Department of Energy each add over $20 million.
The money that comes into the university from research grants covers two categories of expenses that benefit the university in different ways. The first category is direct costs, which are the actual costs for a project in the form of personnel, equipment, travel funding, and other necessary expenses. This money benefits the university by attracting talented researchers and graduate students, who wouldn’t have been hired otherwise, and allowing research to occur that will benefit the university through reputation and potentially monetary means if the results can be commercialized.
The other class of expenses are facilities and administration. These expenses cover the costs of various aspects of support from the university that are necessary for research to occur, including such things as office and lab space, existing and general use equipment, administration, the library, utilities, and other things. This money obviously benefits the university by helping to keep it running, helping to maintain and improve the buildings, providing funding for the library, etc. Facilities and administration costs are set as a flat percentage of the grant; this rate varies a bit between universities but at Ohio State the rate is just over 50%. Thus if a researcher brings in a $1 million grant, they will receive a bit under $500,000 to hire grad students/postdocs, buy equipment, travel to conferences, and do whatever else is required for the project. Ohio State will receive just over $500,000 that is then spent to keep the university and the department operating.
The Ohio State athletic department is one of the largest in the country and its annual revenue is always near the top in the country but how does OSU’s research expenditures rank? A 2012 study by the National Science Foundation found that Ohio State was 19th in the country in total research spending, beating out Yale which came in at 27th. Overall the Big Ten did remarkably well in the rankings with Michigan coming in 2nd, Wisconsin in 3rd, Minnesota at 14th, Penn State at 18th, Northwestern at 28th, Purdue at 32nd, Illinois at 33rd, Michigan State at 36th, and Iowa at 42nd. New Big Ten members Maryland and Rutgers were ranked at 37th and 45th, respectively while CIC member the University of Chicago came in at 51st and new Big Ten affiliate member Johns Hopkins topped the rankings. The performance of the Big Ten in these rankings is rather remarkable and once again illustrates that in the conference, academics is taken as seriously as athletics.