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Patrick Vint

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Member since 24 July 2016 | Blog

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Comment 16 Jun 2017

That's the eternal question.  Actually, it's two questions.

A non-profit can turn a profit, oddly enough.  In order to maintain IRS non-profit status, a non-profit corporation has to maintain its non-profit purpose.  If a non-profit makes a profit on activities related to its purpose and uses those funds to pay expenses, it's fine.  It would even be fine keeping those "profits" in a rainy day fund, so long as the fund didn't get to exceedingly large.  However, if the non-profit is making a profit off of unrelated activities, and that profit becomes a significant part of its operations, it could run into serious trouble with the IRS.

I don't have access to the UI's tax records or 501(c)(3) application, but this could be decided on how UI athletics is structured.  To qualify for 501(c)(3) status, an organization must be operated for one of the following purposes: "charitable, religious, educational, scientific, literary, testing for public safety, fostering national or international amateur sports competition, and preventing cruelty to children or animals."  I have always assumed, largely because the UI Foundation handles UI athletics donations, that UI athletics' not-for-profit status is based on the University's status as a whole.  If that is the case, the question becomes whether running a multi-million dollar sports franchise is an activity related to the UI's academic mission.  This is a big reason why the NCAA doesn't want to pay players; with most programs' 501(c)(3) status based on "educational" mission, a for-profit athletic arm with employees could well be out of bounds.  If you look at recent decisions, like the Northwestern NLRB decision in particular, you see that this is in serious doubt.  And if athletics is unrelated to the academic mission, any significant profit-taking would potentially be grounds for losing 501(c)(3) status, which would make donations to the UI no longer tax-deductible.  And that is catastrophic.

If UI athletics has its own 501(c)(3) status as an entity "fostering national or international amateur sports competition," the profit-taking becomes easier, as it is directly a result of its mission. However, the profits themselves could be problematic if this is deemed to be no longer amateur competition.  Furthermore, running a team is no more related to "fostering sports competition" as running Apple is "facilitating phone conversations," which is why I suspect that UI athletics isn't a separate 501(c)(3).

So long story short: We don't know, but any significant profit-taking, even to establish a rainy-day fund, could put large swaths of the UI in serious jeopardy.  Which is why Iowa never shows a profit of any significance.  It's also why Iowa puts so much money into depreciable assets (which generate a gigantic cash-free expense every year) and generally finances those construction projects (which generates yet another expense every year, this time interest on debt service).  Since 2005, salary and scholarship expense have roughly doubled, but facilities expenses have more than quadrupled as Iowa tries to find ways to spend all this cash beyond just giving it to the actual players.  Because if you can't pay them money, surround them with money.

Comment 24 May 2017

It's nothing nearly that fun. My wife was offered a job that we couldn't turn down, and we were preparing for twins (that are now over a year old) and I have some family in the area to help out.

And honestly, it's just trading Iowa State fans for Nebraska fans, and at least Nebraska fans can put up a fight.

Comment 24 May 2017

If you remember Wha Happened? then you're probably going to remember the new version of the Big Ten roundup coming this fall (OOOH CLIFFHANGER).  And yes, I'll go back in the studio this fall and work on a new song.  Too much stuff with getting the site up and running this year (and changing day jobs and keeping toddlers upright) this year to get much of the extra things done.

Comment 08 May 2017

Yeah, possibly.  The Title IX complaints at issue stem directly from Griesbaum's firing; the argument is that they were deprived of their coach due to a firing on different terms than a male coach would have been fired.  Could there have been a different reason for them to file?  Yeah, probably.  Could there have been a different set of athletes filing on the same sort of claim?  Given Barta's track record with female coaches, I'd say there was enough out there.  This just needed a spark and some fuel, and Griesbaum's firing gave it both.

I'm not sure if the Griesbaum suit is going to have any significant impact on the Title IX investigation, oddly enough, because that investigation has already moved on to an examination of bigger issues.  I think the facilities and opportunities problems remain of serious concern, as is the possibility that Iowa is the sacrificial lamb for a federal government that thinks college football has gotten out of hand and needs an example to hold up.  A violation based solely on practice and game facilities would stop stadium and practice facility construction in its tracks across the nation.  The DOE knows that, and if it wants to refocus big schools away from athletics and toward academics, crushing Iowa is a pretty easy way to get there.