Come on offa that cash pile, Damon!

It’s been reported that my undergraduate alma mater’s fabulously profitable athletic department is, in fact, the country’s most profitable, according to US Department of Education statistics. Led by new director Damon Evans (above), the University of Georgia athletics department posted an operating profit (actually, EBITDA – earnings before interest, taxes, depreciation and amortization) of $23.9M on revenues of $68.8M. After those deductions, the UGA AD netted $18M.

By comparison, the (distant) number two program was the University of Michigan’s, which rang in $17.1M, although its revenues were $10M greater than Georgia’s. The Atlanta Falcons, which pays its players, but which also doesn’t have the burdens of funding a dozen-odd other money-losing sports or of servicing debt on facilities construction (thanks, taxpayers), had $26.8M in EBITDA on $168M revenues. The University of Texas, whence I earned my graduate degree, and which has 20,000 more students than Georgia and yet three fewer varsity sports, posted $15.3M EBITDA on $89.7M revenues.

To put it in another context, the UGA AD’s operating profit is roughly equal to 5% of the University of Georgia’s relatively paltry $517M endowment, which ranks 103^rd in the country.

While my fandom of Georgia athletics is rarely anything less than rabid, seeing Bulldog sports that far in the black actually makes me see some red, and not Georgia red. And no, I’m not pinko either – there’s barely a year’s worth of dust on my MBA. Next to positive cash flow, profits make me happy, particularly when they’re being churned out by an enterprise in which I hold an equity stake.

But the UGA AD doesn’t have shareholders. It has donors, none of whom, so far as I am aware, are paid dividends, in spite of being shaken down for ever-escalating “donations” for season tickets and in spite of suffering ever-withering tailgating privileges. To these people, the UGA AD's Big Oil-rivaling profit margins aren't a point of pride; they're a slap in the face.

Georgia’s 35% operating margin (a breathtaking 53% return on its expenditures), is nearly double that of the NFL’s most profitable franchise, the Washington Redskins, which raked in $53.8M on sales of $287M. And that would be super if the UGA athletics department were a private sector enterprise whose managers had a fiduciary responsibility to run the most profitable organization possible.

But it isn’t.

The department’s mission, per its web site, is “to offer nationally competitive intercollegiate athletic programs, which reflect the interests of our students and faculty, the Southeastern Conference, and the people of Georgia and of the nation, who support our activities.” There’s more, but anyone looking for verbiage such as “sustaining Microsoft-level operating margins” will go wanting.

Still, if you measure “nationally competitive intercollegiate athletic programs” in Directors’ Cup rankings, you could make a case that the UGA AD is executing on its mission. Georgia ranked 7^th in 2004-5, 5^th in 2003-4, 15^th in 2002-3, 8^th in 2001-2, and 3^rd in 2000-1. Notwithstanding our red-headed stepchild treatment of basketball, it’s damned hard to find something to complain about with the way most of Georgia’s teams compete.

But piling up cash for the sake of piling up cash is pointless. When you have the goods, also have the knowledge of how and when to exploit them fully.

The Georgia football team has always carried the UGA AD on its back (this year, to the tune of $38.4M EBITDA on $50.9M revenues – a stupefying 75% op margin). It is unquestionably the school's most visible athletic enterprise and, as such, its formidable success has overshadowed the dominance of Georgia's gymnastics, tennis, golf and equestrian programs. Maddeningly, it has also done so almost exclusively east of the Mississippi River and south of the Mason-Dixon line, at least during the regular season.

If our mission is national competitiveness, such regional insularity by our most prominent athletic team is wildly inconsistent and is sorely disappointing to out-of-region alums like me. Sure, we’ve been constrained by having to play Florida every year on a neutral site in Jacksonville and by having to play an out-of-conference, in-state rival every year, (although I’m beginning to question how rivalrous our rivalry with Georgia Tech really is these days). But we’re only now deigning to take regular season non-conference roadtrips to someplace more exotic than the other side of Lake Hartwell.

Since Georgia’s last regular season trip out of the Southeast, man took his first steps on the moon, the Beatles released Sgt. Pepper’s Lonely Hearts Club Band, the Oval Office has had eight occupants and Bobby Bowden has taken Florida State to national prominence by hauling the former women’s college’s football team all over the country to take on all comers.

For more on this, please refer to T. Kyle King’s eminently worthy Movement, in which the Bulldog blogosphere’s most erudite scribe advocates a home-and-home with Michigan. Personally, I’d love to see something similar with Texas. As evidenced by their series with Ohio State and in spite of their neutral site game with Oklahoma in Dallas, the Longhorns have shown the "have cash, will travel" disposition that I hope will soon take hold in the Butts-Mehre building, especially in the era of a 12-game regular season.

Meanwhile, our basketball team plays in a coliseum that was designed by the Jetsons’ architect. A facelift by Mike Brady would qualify as modernization. In the interests of portfolio diversification and particularly given the basketball success of so-called football schools such as Florida, LSU and Texas, a sustained commitment to men's hoops, our only other profitable sport, is long overdue. The addition of a practice annex to the Stegasaurus is encouraging, but time will tell if it's just another bone the AD has infrequently tossed at hoops throughout its Ike-and-Tina relationship with the sport.

We have a varsity women’s soccer team and at least a dozen intramural men’s teams, but no varsity equivalent. The sport of lacrosse has caught fire in the sunbelt, with dozens of high school teams budding in Georgia. As a former player (attack and midi), I’d love to see Georgia field varisty men’s and women’s lacrosse teams, although I thoroughly enjoyed my time as a club ball player at Georgia.

Outside of reinvesting in sports, how about giving back to the entities who fertilized this money tree? Perhaps a nice gift to the school or, for the unfailingly generous and unceasingly beleaguered fans who will be asked to tailgate in Winder next year, how about a proper tailgating village, a sort of Grove on steroids?

Anyway, by now, you should have gotten my point. For the dim, it is this: cash is not its own end for a quasi-public enterprise like the UGA athletic department. It is a means. Deploy it, Damon.