College Athletics Debt: Revenue Strategies to Service It
College athletics debt is widespread: 72 percent of Division I schools reported it in 2023-24, according to the GAO. Much of the largest debt finances facilities. As athlete revenue sharing adds costs, departments are developing premium seating, naming rights, events, and recurring commercial partnerships to support debt service.
Oct 12, 2026
Most coverage of athletics debt focuses on one campus at a time. National data from the GAO shows how widespread it is.
In a report released this summer, the U.S. Government Accountability Office found that about 72 percent of Division I schools reported athletics debt in 2023-24, including 96 percent of the 69 Power conference schools, where the median balance was $120.3 million.
Athletic department debt at that scale reflects how college athletics has been financed for decades, and it is shared by nearly every major program in the country. This post covers where that debt comes from, how revenue sharing changed the math, and how departments are building income to service it.
Key Takeaways
About 72 percent of Division I schools reported athletics debt in 2023-24, including 96 percent of Power conference schools, according to the GAO.
The largest balances are tied to stadium renovations and other facilities financed over decades.
Athletic departments were built to reinvest every dollar, which is why 330 of 352 Division I programs spent more than they generated.
House settlement revenue sharing, now capped at $21.58 million per school for 2026-27, adds a large and permanent expense.
The departments best positioned to carry debt are building recurring revenue to support it.
Where Athletic Department Debt Comes From
The largest balances trace back to buildings. Sportico reported that Penn State closed fiscal 2025 with $534.7 million in athletics debt, up from $163.1 million a year earlier, as it financed a $700 million renovation of Beaver Stadium. Cal reported $432 million in outstanding athletics debt as of fiscal 2024, much of it tied to the 2012 renovation of California Memorial Stadium.
These are long-lived assets financed over decades, in much the same way universities finance residence halls and research buildings, and many of the projects were planned with new premium seating and event revenue as part of the financing case.
Debt levels also vary widely beyond the Power conferences. The GAO put the median at $21 million for other FBS programs, $8.6 million in the FCS, and $5.5 million at Division I schools without football, and more than a third of schools in those last two groups (37 percent in the FCS and 40 percent of non-football schools) reported no athletics debt at all.
Debt can also come from operating support. The GAO describes athletics debt as building up over time, including through loans from the institution or other sources to cover annual deficits.
The Chronicle of Higher Education has reported on universities stepping in to support their athletic departments through this transition, including Kentucky's plan to lend its athletic department up to $141 million and an internal loan in Michigan State's 2025-26 athletics budget.
Why Athletic Department Budgets Were Built to Break Even
Athletic departments were set up as units of tax-exempt universities or as affiliated nonprofit associations, and they were built to reinvest what they bring in.
Economist Howard Bowen described this pattern in his 1980 book The Costs of Higher Education as the revenue theory of cost, the idea that institutions raise all the money they can and then spend it in pursuit of quality and reputation. A 2015 study in the Journal of Sports Economics found that Division I athletic spending was consistent with that theory.
The financial results follow from the design. According to the GAO, 330 of 352 Division I programs spent more than they generated in 2023-24, with a median gap of $20.6 million, and institutions contributed $7.2 billion to their athletic programs that year. Those dollars funded scholarships, coaching, academic support, and broad-based sport sponsorship across dozens of teams, which is what the model was built to do.
Only 20 of the 69 Power conference schools generated more revenue than they spent.
It is also true that major programs have been commercially sophisticated for a long time, with media rights, sponsorships, and premium seating producing significant income. The structure did not require a margin, since new revenue was reinvested in scholarships, staff, and facilities.
What Changed: Revenue Sharing and the House Settlement
The House v. NCAA settlement, which received final approval on June 6, 2025, added a large and permanent line to the expense side. Schools can now share up to 22 percent of average Power conference revenue directly with athletes, a cap that started at $20.5 million in 2025-26 and now stands at roughly $21.58 million for 2026-27 following the first audit of conference revenue.
In the first year, about $1.77 billion went to 34,915 athletes at 307 schools, and 63 of those schools spent to the full cap.
Federal policy could add to that. On September 28, the Senate passed the Protect College Sports Act by a 77-22 vote, and the bill would create an additional retention fund of $22.5 million per school that could rise to $27.5 million. The bill now goes to the House, which is scheduled to return for its lame-duck session on November 9, so the final terms are still uncertain.
Institutions are also changing how they organize to meet these costs. Utah finalized a partnership with Otro Capital in June that created a new commercial entity called Crimson Brand Partners.
The Big 12 arranged an optional credit line of up to $30 million per school through RedBird and Weatherford Capital, and the Associated Press has reported on new affiliated ventures at Kentucky, Louisville, Virginia Tech, and Michigan State.
These schools are creating dedicated commercial operations to cover fixed obligations of this size.
How Athletic Departments Are Building Revenue to Carry Debt
Debt is ultimately judged by coverage, meaning whether dependable income can service the obligation while still funding competitive teams. That is why the strongest answer to a debt headline is a clear account of the revenue that stands behind it.
The stadium projects themselves show how this works. When Penn State's trustees approved the Beaver Stadium renovation in 2024, the university projected at least $44 million in profit over 30 years from the renovated building. Sara Thorndike, the university's senior vice president for finance and business, told trustees the school was "determined that this will be an athletic self-sustaining project," with philanthropy, naming rights, and ticket revenue projected to reduce the total debt by $134.3 million.
Texas Tech announced a 15-year naming rights agreement with Galaxy this summer, a deal reported at $75 million.
Venues are also earning on dates when no game is played, with Texas A&M reporting $3.9 million in net revenue from a single George Strait concert at Kyle Field and Michigan budgeting $1.7 million in net revenue from a Zach Bryan concert at Michigan Stadium.
The same thinking extends well beyond the venue. We have written before about how programs are unlocking revenue from assets they already own and building new revenue in the post-House era, both of which focus on recurring income from relationships a university already has, including alumni-owned businesses, enterprise brand partners, and the institution's own purchasing.
Revenue also has to keep pace with rising costs. The GAO found that median spending at Power conference programs rose 81 percent over the decade ending in 2023-24, while median generated revenue rose 56 percent, which is why building new, recurring income has become a priority for athletic departments across the country.
What Comes Next for College Athletics Finances
Debt and revenue belong in the same conversation. Nearly every major program carries debt, most of the largest balances are tied to facilities that will serve athletes and fans for decades, and the leaders managing it are doing so while absorbing a significant and permanent change to their cost structure.
The departments that tell this story well will be able to show their boards, donors, and lenders three things together: what they owe, what it built, and the recurring revenue that carries it. More departments now have the data to make that case.
Build Recurring Revenue for Your Athletic Department
NOCAP Sports works alongside university athletic departments as an embedded commercial operating partner, helping build recurring revenue through alumni business networks, enterprise partnerships, and university purchasing. Contact us to learn more.
Frequently Asked Questions
How common is college athletics debt?
According to the GAO, about 72 percent of Division I schools reported athletics debt in 2023-24, including 96 percent of Power conference schools. Among Power conference schools reporting debt, the median balance was $120.3 million.
Where does athletic department debt come from?
The largest balances generally come from stadium renovations and other facilities financed over decades. Debt can also accumulate through loans from universities or other sources to cover annual operating deficits.
Why do most athletic departments spend more than they generate?
Athletic departments were built to reinvest revenue in scholarships, coaching, facilities, and sport sponsorship rather than consistently produce a margin. The GAO found that 330 of 352 Division I programs spent more than they generated in 2023-24, with a median gap of $20.6 million.
How does the House settlement affect athletic department budgets?
The House v. NCAA settlement allows schools to share revenue directly with athletes, adding a substantial ongoing expense for participating departments. The annual cap began at $20.5 million per school in 2025-26 and rose to roughly $21.58 million for 2026-27.
How are athletic departments generating revenue to service debt?
Departments are developing premium seating, naming rights agreements, concerts, and other non-game events. They are also creating dedicated commercial operations and pursuing recurring income through alumni business networks, enterprise partnerships, and university purchasing.
What determines whether an athletic department can carry its debt?
The article emphasizes debt coverage: whether dependable income can service debt while still funding competitive teams. Evaluating finances therefore requires looking at outstanding obligations, the assets they financed, and the recurring revenue available to support them.
