“It’s fundamentally altered the way we think about everything,” Sullivan said. “NIL really in 2021 changed that. Then as we’ve moved more toward more dramatic changes, it’s become a part of our daily operation — a part that we didn’t have before. It includes everything from how we allocate resources to how we’re structured as a staff. There’s been a fundamental shift in our day-to-day operations as we prepare for that.”
Asked how confident he is that UD is ready for this moment, Sullivan said, “We’re ready. I’m confident we’re going to be well positioned. That doesn’t mean it doesn’t keep me up at night, or that anything’s easy, but we have a legacy of a fan base. We have a healthy program. We have a university that believes in athletics and believes in basketball. We have alignment there. We have a community that supports it. So we’re going to be aggressive. We’re going to be bold.
“I tell people, ‘Scared money doesn’t make money.’ This is not for the faint of heart. You have to be responsible and appropriate, but that has to be balanced with a certain level of aggressiveness. We tried to take that approach this year with (men’s basketball) scheduling. You’ve got to roll some dice to be able to do what we want to try to keep doing. So, yeah, I’m confident and feel prepared, but that is not a statement of naivety or arrogance that this will be anything but challenging.”
Sullian talks every year — often several times a year — to the Dayton Daily News about the changing landscape for the Dayton Flyers. His latest interview took place Jan. 5. It touched on many different topics related to the new era, which is expected to start July 1.
1. Coming change: Schools will have to decide whether to opt in or out of sharing revenue with athletes. It’s an easy choice for schools, like Dayton, that want to continue to compete at the same level.
“I think the schools that are anticipating to opt in, you have to act as if the case is going to settle,” Sullivan said, “because if you were to wait until it does and then think that you’re going to be ready for an effective date of July 1, that would just be frankly not possible from a business and operation standpoint.”
While there are many specifics that have to be worked out in regards to how this is all going to work, Sullivan said, “What I tell people is we definitely have a compass. We may not have a map, but we definitely have a compass of the direction that this is going, and so that’s what we’re prepared for.”
2. Spending millions: A memo sent to schools in power conferences in the fall projected there will be a $20.5 million cap per school for athlete revenue sharing in the 2025-26 academic year. That’s 22% of the average projected revenue for schools in the power conferences. The cap will rise 4% every year.
The amount Atlantic 10 Conference schools, which do not reap the benefits of having Football Bowl Subdivision teams and the TV money that comes with them, will pay to athletes will be far lower. The Richmond Times-Dispatch reported on Jan. 4 that Virginia Commonwealth will distribute $4-5 million to its athletes every year. Sullivan didn’t want to put an exact number on what UD’s payments to athletes will be.
“Since the NIL era started, despite everyone’s best efforts, the entire industry has really struggled to make precise and accurate predictions about player compensation,” Sullivan said. “I see the various headlines, and I try not to add to the list of failed market predictions. But it is going to require a significant investment. I’m comfortable saying that it’s in the millions. Our investment has to match our program’s expectations. I think there are some schools out there that have said some things publicly.
“Our strategy is a little more tailored to our specific needs, our market conditions,” Sullivan said. “But the way I look at it is it’s not just the dollars, it’s how you invest those dollars and how you evaluate the talent. We’re just going to do whatever we think is necessary to attract the type of players that we need here. If that number is X in Year 1, and it’s 2X another year for an NBA-caliber player like DaRon Holmes, we really have to have the ability to be nimble and flexible, while at the same time not pinning ourselves down to a specific model. This thing has changed so many times and changed so fast that I’ve been reluctant to put a specific number on it other than to say we’ll be bold and aggressive, and we will invest in a way that meets what our aspirations are for the program.”
Another A-10 Athletic Director Chris May also did not put a number on how much the school will pay athletes when he talked to longtime Saint Louis beat writer Stu Durando in early January.
“Our process internally is working through groups to determine what is the process and how we’re going to do that,” May said. “We’re going to have to find ways. We have a collective today. Those revenues would be moved internal. One of the great advantages is that by opting in, the contributions that are made will be tax deductible.”
Credit: David Jablonski
Credit: David Jablonski
3. Finding revenue: College athletes have earned money from NIL deals for the past four seasons. This past spring, the NIL collective that represents UD athletes, Dayton 6th, played a big part in the recruiting process when Dayton added five newcomers: transfers Zed Key, Jacob Conner and Posh Alexander; and freshmen Amaël L’Etang and Hamad Mousa.
While college athletes will still profit off their name, image and likeness, they will now also earn a share of the revenue schools make through ticket sales, television deals, etc.
To increase revenue and cut costs in some areas to make it easier for Dayton to afford the types of players it needs to compete for NCAA tournament berths and conference championships, Sullivan said the school will “attack three different buckets.”
“Our plan includes revenue growth,” he said. “Obviously, we’re going to have to do some things around revenue, whether that’s ticket pricing and corporate partnerships and fundraising. Our cost structure in sports other than basketball is a serious part of this exercise. No one likes to talk about that. We have 420 athletes, and we care deeply about all of them, but we’ve got to go under the hood of everything. Basketball and football at a lot of these schools subsidize those sports. That subsidy is going to become more challenging in the future if a percentage of the revenue that those sports generate is going to the athletes in those sports.”
4. Ripple affect: What to do with the sports that don’t produce revenue for the university is a challenging conversation, Sullivan said. Will Dayton have to cut spending in those sports to be able to afford to pay men’s basketball players? Or will it find enough revenue elsewhere to support those sports?
“We’ve had a lot of coaches meetings,” Sullivan said, “and we’ve talked about it, and I’m certainly not going to wave the white flag on any of those sports. But right now, at Dayton, we generate money from our basketball program. We use those expenses to run the basketball program — the coaches, the staff, the scholarships, the travel, everything that goes with it. There’s money left over at the end of the day that’s allowed us to have the volleyball team that we have and the soccer teams and the golf teams and what have you.
“There’s going to be pressure on the subsidy that’s coming from basketball, and so that subsidy now will stay more within the basketball program. We’ve got to find a way to maintain these other sports. That’s a daily activity. It’s just a reality that schools are going to have to grapple with. How do you fill that void?
“I’m not interested in eliminating any sports. Our young people are just world-class student athletes, world-class people. They’re great students. We want to give them an experience that’s worthy of the University of Dayton name and the log. We intend to do that, but that’s going to have to be through a lot of philanthropic support and a lot of long-term reimagining of how those sports operate. The challenge is it’s hard to do that unilaterally. You kind of need a coalition to go with you. You need competition. You’ve got to play people. So there’s a lot of discussion about how we can continue to give those young men and women a tremendous experience, but that won’t be an easy task.”
4. Women’s sports: How does Title IX play into all this? For decades, colleges have devoted an equal number of scholarships to men’s and women’s sports. Now most of the revenue is expected to be paid to football and basketball players, or just basketball players in the case of schools that don’t have an FBS football program, like Dayton.
“There’s a lot of debate about that right now,” Sullivan said. “We’re committed to complying with Title IX and whatever regulations they develop from this. I think it’s unchartered territory. A lot of these Title IX regulations were written with scholarships in mind, not with revenue sharing. Ultimately, I think it’s going to be a couple years before there’s any true clarity on that.”
Credit: David Jablonski
Credit: David Jablonski
5. Ticket prices: In an email to season-ticket holders last April, Sullivan informed them there would not be an increase in per-seat donations for the 2024-25 season. The original plan when the UD Arena renovation project was announced in 2017 called for no price increases for a five-year period from the 2019-20 season through the 2023-24 season.
The reason for the delay in a price increase was the “uncertain legal and regulatory matters around student athlete compensation and benefits.”
With the NCAA settlement bringing clarity to the situation, a rise in ticket prices is coming for a fan base that has bought every ticket the past three seasons and sold out 69 straight games.
“I held off because I wanted to see what this looks like,” Sullivan said. “We have a great relationship with our fans. We’re very lucky. We’re very fortunate to have them. Every time we have to rise to the occasion as new things develop in college sports, they’ve gone with us, but I wasn’t comfortable just dribbling out, ‘We’re going to do this, but then we’re going to do that.’ I want to have a comprehensive strategy that fans can digest and understand. (The increase) will be very transparent and very honest and very much directed toward the players. I don’t need ticket price increases paying for administrative bloat or those types of things. I really have been delaying that until I had a clear picture. I think we do have a clearer picture now. I view our fans as investors in our program, and they’re owed to know if we’re asking them to step up, how much it’s going to be, how it’s going to be spent and what we plan to invest it in.”
Sullivan expects an announcement on ticket prices to be made before next season.
“We have our annual billing cycles,” he said. “I think we’re still working on it, but I can’t hide it. The future of college sports is the survival of the fittest fan base. That’s the bottom line. That’s where it’s headed. ... But at the same time, we have a responsibility, just like any organization, to allocate those resources effectively and evaluate our cost structure versus just always looking on the revenue side. It has to be both — revenue and some difficult expense decisions that have to be part of the equation.”
6. Investing everywhere: If players are now earning a share of revenue, it’s fair to wonder if the coaching staff can continue to make as much money as it does. Dayton’s three highest-paid men’s basketball coaches made more than $3 million combined in the fiscal year that ended in June 2023, according to the most recent UD tax return available on ProPublica.org.
Head coach Anthony Grant made $2,447,095. Dayton Associate Head Coach Ricardo Greer made $345,001. Assistant coach James Kane made $298,076.
Sullivan doesn’t see pay cuts coming for anyone.
“I think maybe the rate of growth of coaches’ salaries may start to feel some pressure,” he said, “but at the end of the day, there’s a complex set of factors that influence program success. There’s not one single formula. It’s players. It’s coaches. We know that with high-quality players and high-quality coaches, there’s a cost to them. That’s just a fact.
“Then you have the rest of the things involved in the program, everything that needs to happen. There are teams in the NFL that spend $200 million on their payroll, and they’re still there in last place. I think anyone would tell you that you have to have coaches and players to have a chance. There’s no doubt about that. But you also still need facilities. You need infrastructure. You need locker rooms. You need trainers. You need all those things. I don’t see those things becoming less important.
“If you look around at the winningest programs, whether that be in football or basketball, they’re just investing in everything. That’s my approach. You have to invest in players. You have to invest in coaches. But we have to invest in everything. You can never take your foot off the gas. If you’re going to go and play in the tournaments like we want to play in and play North Carolina and Iowa State and UConn and whatever, you can’t be too selective on your investments. You have to be great across the board and invest in everything that you can.”
7. Recruiting effects: Sullivan expects the market to dictate how contracts with athletes are handled. Incoming freshmen or transfers could sign one-year contracts or multi-year deals.
“Right now, we don’t have any direct evidence of a substantial defined market,” Sullivan said. “We have ideas. We have anecdotes. We have ranges based on our experience in recruiting, what others are saying. But it’s not like the NBA and NFL, where there’s complete transparency in player contracts and you kind of know what the market looks like. At Dayton, all options are on the table. There are going to be young people who want to agree to multi-year deals. There are going to be others with people telling them to maximize their value each year and on’t enter long term deals. If you want me to sign players like Jalen Crutcher or Obi Toppin to a four-year deal, I’m glad to do it, right?
“I think we’re just going to have to let that play out and to see what the market dictates. A lot of the predictions so far from the NIL standpoint have proven not to be correct. Even if you’re paying, kids are still transferring for variety of different reasons. I think you will see some multi-year deals. You’ll see some single-year deals. It will be different on each team. You can have certain players on a single-season deal and some players on a multi-year deal. In our case, those will be very individual negotiated discussions. That’s what we anticipate.”
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