Why the State's Budget Woes Will Increase the Number of In-State Athletes

Monday, we looked at how this year's state budget cuts will affect MSU athletics. Tuesday, we looked at how those cuts will hit the university as a whole. Today, we pull out our crystal ball and peer into the future.

It will come as no surprise that the cash-strapped state of Michigan just isn't investing in higher education like it used to. State appropriations rose 18 percent from 1997 to 2007, which might sound good on it's own, but it isn't. The cumulative rate of inflation over that time period was a hair over 30 percent, which means that state appropriations to MSU actually fell in real dollars over those ten years. Not only that, but it's way below the national average of a 55 percent increase over ten years.

So what does the future hold for state funding? Nothing good. The small cuts this year, minimized by federal stimulus funding rules that prevented them from being sliced even more, will likely be magnified next year when those rules go away.

That, in turn, will increase tuition, placing a further burden on athletic budgets. The department doesn't get discount rates for tuition, it pays at the same rate as everyone else. However, the athletic department brings in out-of-state students at a much higher rate than the general student population, so those tuition payments are even more expensive. Consider that the estimated room/board/tuition cost for an out-of-state student is about $35,276 a year, while in-state students pay just $18,878.

My guess is that over the next few years we'll see that ratio swing back closer to the general student population's averages. In fact, we're already seeing such a move with the football team. According to Rivals.com, MSU has 12 verbal commits in its 2010 recruiting class, and eight of them are from Michigan.

Using those tuition estimates, MSU's football program is poised to save more than $520,000 over the next four years just from those eight kids not being out-of-state students. That's not chump change, and if Mark Dantonio can find a way to recruit mostly in-state and still win consistently on the national stage, this could be the money-saving wave of the future.

How the State Budget Crisis Could Affect MSU: Part One

Facing a massive budgetary shortfall, state lawmakers are looking to cut roughly $1.2 billion out of about $9 billion general fund budget, and almost nothing is safe.

Mid-year cuts to schools, shuttering prisons, scaling back even further on road repairs, everything is on the table. However, none of those cuts are likely to directly threaten MSU sports in any significant way.

How's that, you ask? Simple. MSU athletics isn't funded, in whole or in part, by tax dollars from the state of Michigan.

MSU requires its athletics department be fully self-sufficient, meaning that its revenues are solely drawn from things like ticket, concessions and merchandise sales. It also makes money from sponsorships and Big Ten revenue sharing. Profits made by the athletics department stay within the department and aren't filched by the university for educational purposes.

The reason for that rule is simple. You never want athletics to "compete" with, say, the College of Education for money. However it comes in extra handy during times like these, when one wants to protect the sports (and things like Tom Izzo and Mark Dantonio's multi-million dollar contracts) from state funding cuts.

Now, there is obviously some overlap. Big-time donors to academic pursuits often get sports tickets or facility tours as a "thank you" for their generosity, for example. But should the state cut, say, $30 million from MSU's budget mid-year, you won't really see the impact on the football field.

If no budget is passed by October 1, state government in Michigan will shut down for the second time in three years, and that could potentially impact football Saturdays in a small way. In a government shutdown, essential services performed by the State Police would remain in operation, however it's unlikely that directing traffic for MSU football for the Oct. 3 game against Michigan would be seen as "essential" under that mission. It would be an inconvenience for MSU to replace those officers, sure, but the university doesn't rely that heavily on the State Police and could likely pick up the slack by bringing in more officers from other municipalities.

Coming Tuesday: While the budget mess won't affect MSU sports directly, it is likely to impact the rest of the university quite severely. We'll take a look at what cuts are on the table, and what the fallout might be.