Finance

With major change to CHSAA’s tournament and playoff finance structure, host schools now in position to make more money off postseason

Published

11 months ago

January 30, 2024

With major change to CHSAA’s tournament and playoff finance structure, host schools now in position to make more money off postseason

LONE TREE — Colorado high schools are about to make a lot more money hosting playoff games and events.

The CHSAA Legislative Council voted to amend the association’s tournament and playoff finance structure on Tuesday at the DCSD Legacy Campus. Previously, host schools paid a percentage of their playoff gate revenue to CHSAA and also a portion to help reimburse visiting teams for traveling.

But under the new amendment — which passed overwhelmingly via a 56-14 vote — each member school will now pay an annual playoff fee to CHSAA, with the amount based on what basketball classification that school is in. With that fee paid, schools now get to keep the profits from hosting playoff games and events such as regionals, without having to share that revenue with CHSAA.

“This is a structural and fundamental change to the way that we’ve done things,” CHSAA commissioner Mike Krueger said. “This approach is more of a cost-share, because we are a membership that’s a benefit-share approach.”

The amendment came to the floor on Tuesday following months of research by CHSAA’s Tournament & Playoff Finance Committee, which found that schools hosting playoff games and tournaments (such as wrestling or volleyball regionals) were consistently finding themselves in the red.

For example, Tournament & Playoff Finance Committee chairperson Paul Cain, the athletic director for the Mesa County Valley School District, said that 85% of last year’s hosts for wrestling regionals lost money. With this change, that deficit would now be a $5,000 profit for each host school.

The association’s tournament and playoff finance reports reveal that postseason money accounts for 5-10% of CHSAA’s organizational budget, and Cain argues that “the teams that are in the playoffs are currently subsidizing this money, and now, this would go across the membership.”

CHSAA Director of Finance Sarah Vernon-Brunner said this amendment will have “no financial effect on CHSAA.”

“The committee … looked at a five-year average of playoff revenues and used that as the basis for determining the total (playoff) fees,” Vernon-Brunner wrote in an email to The Denver Post.

While CHSAA membership fees will remain the same for a third straight year in 2024-25 — each school’s membership dues are $948, plus a $161 participation fee for each sport/activity — this playoff fee will now be tacked on to schools’ costs. Class 1A schools will pay $600; 2A $800; 3A $1,000; 4A $1,400; 5A $1,900 and 6A $2,600.

Two of Colorado’s largest districts, Denver Public Schools and Aurora Public Schools, opposed the amendment.

In a statement to The Denver Post, DPS said that the amendment’s “year-over-year projections show significant financial impacts to the district,” and DPS district athletic director echoed that sentiment on Tuesday.

“We ran the models in Denver with our current structure,” Bendjy said. “We lost $2,000 over the last two months in postseason activities, but with this proposed structure and the same events, we’re now down $16,000. That’s a loss of 800%. Philosophically, this is not a financial structure we can get behind at this time.”

APS district athletic director Casey Powell also spoke out against the amendment ahead of its passing vote.

“This will create an absolute stable function for CHSAA, but it will completely flip my budget personally, upside-down, for the way I hold my budget,” Powell said. “Because I don’t get that (new) revenue, because my schools don’t regularly make the playoffs. So to say I’m going to get that (playoff) fee back is not true.”

Krueger acknowledged those concerns, but said that “for all intents and purposes, this is a membership due.”

As part of the amendment, in a head-to-head playoff game, if the host makes $1,000 or more in net income, then 25% of that gets paid to the visiting team. Cain said the 75/25 split would be done on an “honor system.”

Krueger also added that this new model would incentivize schools to host regional tournaments, rather than disincentivize them, and that districts like DPS and APS could possibly recoup their playoff fee by hosting those tournaments.

“If you host a regional, this should in some ways help, because events you wouldn’t look to currently host maybe that would change and encourage our membership to host these events,” Krueger said. “And if you deserve the right to host (based off playoff seeding), should our system be one in where it costs you significantly to host that (game or) event?”

To Krueger’s point, this fall, Cherry Creek athletic director and Tournament & Playoff Finance Committee member Jason Wilkins said the Bruins took a loss on their first-round football playoff game despite a couple thousand people in attendance at the Stutler Bowl.

Under the current model, CHSAA receives 10% of the gross receipts and 70% of the net proceeds off football playoff games from host schools. In basketball, which is traditionally the association’s biggest playoff money-maker, CHSAA’s due 20% of the adjusted gross receipts.

Wilkins said that cost structure, in addition to having to pay ticket-takers, police, security guards, officials and visiting travel expenses, “doesn’t leave a lot of opportunity for profit for hosts.”

Mead athletic director Chad Eisentrager doubled down on Wilkins’ opinion, arguing that profits from playoff games and events “should stay within those communities that are putting in the work, the time and resources.”

“Three years ago we hosted Roosevelt in the state semifinals for football,” Eisentrager explained. “We had almost $13,000 in revenue, and we lost money as a result of the security and all the other fees that went along with running that event.

“So in fact, we are losing money on these (playoff events), when my community, who had a right to host that event, got to keep zero of that revenue. This (new amendment) spreads (the cost burden) out, and if you’re successful enough to host one big basketball game, one big football game or some of these other (postseason) events like regional wrestling, (you’ll make the fee back).”

Cain also argued that the new amendment creates “some flexibility for schools on how they treat the postseason.” For instance, schools wanting to boost attendance and atmosphere can now elect to not charge their students for postseason games, so long as they let the visiting students in for free, too. Before, there was a fee for not charging a gate.

And the Tournament & Playoff Finance Committee said that in addition to increased revenues for many schools, the amendment also eliminates a lot of paperwork that was convoluting the money trail.

“One of the things (the committee) has heard is, visiting schools always don’t get their (travel) money like they’re supposed to,” Wilkins said. “Such-and-such school is supposed to pay, but it’s not always that simple, or that timely, or you have to keep asking. Different districts have different financial systems. So there’s a lot of (red tape), in conjunction to the time filling out a lot of these forms.”

The amendment will go into effect for the next two-year CHSAA cycle.

Want more sports news? Sign up for the Sports Omelette to get all our analysis on Denver’s teams.

Click to comment

Finance

Personal finance guru Dave Ramsey warns over 'mind-blowing' Christmas debt

Published

1 hour ago

December 22, 2024

Press Room

Personal finance guru Dave Ramsey warns over 'mind-blowing' Christmas debt

Personal finance expert Dave Ramsey joined ‘Fox & Friends’ to discuss the Federal Reserve possibly cutting interest rates and how Americans can avoid overspending during the holidays.

Holiday spending is putting a big strain on American wallets and leaving some in debt well past the holiday season; however, personal finance expert Dave Ramsey said ‘mind-blowing’ debt can be avoided.

“The average over the last several years has been that people pay their credit card debt from Christmas into May,” The Ramsey Solutions personality shared during an appearance on “Fox & Friends” on Wednesday. “So it takes them about half the year to come back, and because they don’t plan for Christmas… it sneaks up on them like they move it or something.”

According to a study conducted by Achieve, the average American will spend more than $2,000 for the 2024 holiday season, breaking down the outflow of cash into travel and holiday spending on hosting parties, food, clothing, and other gifts.

STOP OVERSPENDING OVER THE HOLIDAYS AND START THE NEW YEAR OFF FINANCIALLY STRONG

Another recent survey by CouponBirds indicated that parents will spend an average of $461 per child and that 49% of parents will go into debt to pay for this Christmas.

Ramsey Solutions’ Dave Ramsey says “you won’t overspend” if you stick to a Christmas budget. (Getty Images)

The Ramsey Solutions personality balked at the amount of money shelled out for the season while explaining that the holiday should not come as a shock, and that spending for it should be planned out.

“Those numbers are mind-blowing when you look at the averages there. That’s a lot of money going out,” Ramsey added, “all in the name of happiness comes from stuff, and it doesn’t.”

He also weighed in and agreed on advice from fellow expert, Ramsey Solutions personality and daughter Rachel Cruze, who suggested making a list of people to shop for and noting how much to spend on each.

FOX Business’ Lauren Simonetti details the holiday shopping season on ‘Cavuto: Coast to Coast.’

“You know, I’m old, and I met a guy from the North Pole,” the expert joked. “He said ‘make a list and check it twice,’ so Rachel’s right.”

Ramsey followed up by expanding on his daughter’s suggestion: “If you do that, and you put a name beside it, and then you total up those dollar amounts, you have what’s called a Christmas budget.”

“If you stick to that, you won’t overspend,” “The Ramsey Show” host remarked.

National Retail Federation CEO Matt Shay reacts to the latest report that holiday spending is expected to reach $989B this year.

The money guru pointed out what he sees as problematic with the holiday season – not taking a shot at Christmas itself – but referring back to the spending issues.

“The problem with Christmas is not that we enjoy buying gifts for someone else. That’s a wonderful thing,” he reassured. “The problem is we impulse our butts off, and we double up what we spend because the retailers make all their money during this season.”

GET FOX BUSINESS ON THE GO BY CLICKING HERE

Ramsey concluded by advising shoppers to be wary of retailers and to not be ensnared by their marketing strategies.

“They’re great merchandisers,” he warned. “They’re great at putting stuff in front of us that we hadn’t planned to buy.”

READ MORE FROM FOX BUSINESS

Ramsey Solutions personality Jade Warshaw breaks down the latest economic data that shows consumer credit card debt is piling up amid a jump in spending.

Finance

Can AI Solve Your Personal Finance Problems? Well …

Published

9 hours ago

December 22, 2024

Press Room

Can AI Solve Your Personal Finance Problems? Well …

Switch the Market flag

for targeted data from your country of choice.

Open the menu and switch the
Market flag for targeted data from your country of choice.

Need More Chart Options?

Right-click on the chart to open the Interactive Chart menu.

Use your up/down arrows to move through the symbols.

Finance

5 smart ways to use a year-end bonus

Published

17 hours ago

December 21, 2024

Press Room

Are you expecting a year-end bonus? If so, you’re probably dreaming up all the ways you could spend that windfall.

The average bonus was $2,447 in December 2023, according to payroll company Gusto. That’s a sizeable chunk of change — one that could put you in a better place financially in 2025 with proper planning.

This embedded content is not available in your region.

If you expect a bonus to land in your account soon, it may be tempting to splurge. And that’s perfectly fine. After all, you deserve a reward after working hard all year.

However, before you make an impulsive purchase, consider a few ways you could use those funds to improve your financial situation.

In today’s high interest rate environment, it’s expensive to carry debt. And the higher the interest rates you’re paying, the faster that debt balance can grow.

So, consider using your end-of-year bonus to pay off some of your debts. Not only does this clear your balance faster, but it also saves you money in interest over time.

For example, say you have $3,000 in credit card debt at 21% APR. If you took 12 months to pay off that debt, you’d pay $279 per month and spend about $352 in interest (assuming you don’t make any new purchases on the card).

Now let’s say you receive a $2,000 bonus and use it to pay down your credit card balance to $1,000. In this case, you’d only need to pay $93 per month to eliminate your balance in one year. And you’d pay just $117 in interest — a savings of $235.

Read more: What’s more important: Saving money or paying off debt?

If you’re not sure what to do with your bonus money, you shouldn’t feel pressured to use it right away. You can set it aside in a bank account while you decide. However, if your money is going to sit in the bank, you should at least earn interest and help it grow without any work on your part.

Following the Federal Reserve’s recent rate cuts, deposit account rates are on the decline. Still, there are plenty of high-yield savings accounts, money market accounts, and certificates of deposit (CDs) that pay upwards of 4% APY (or even more). Take some time to compare today’s rates and account options and put your bonus in an account that will help it grow.

See our picks for the best account options today:

It’s important to have a financial safety net in the event of a financial emergency, such as a car repair or job loss. An emergency fund can help you keep your budget intact and avoid taking on new debt to cover a surprise expense.

It’s typically recommended that you keep enough money in your emergency fund to cover three to six months’ worth of living expenses, though you might need more in certain situations. If you don’t already have an adequate emergency fund in place, a year-end bonus could help you get started.

Read more: How much money should I have in an emergency savings account?

One of the best things you can do for Future You is invest for your golden years. In particular, retirement accounts such as 401(k)s and IRAs are a good option because you can contribute pre-tax dollars, which allows you to lower your tax bill in April (or get a bigger refund), as well as defer taxes until you make withdrawals.

For the 2024 tax year, you can contribute up to $23,000 in a 401(k), and an extra $7,000 if you’re age 50 or older. If you haven’t prioritized saving for retirement in the past, or you want to take full advantage of an employer match, you can ask your payroll department to direct some or all of your bonus to your account.

Read more: 401(k) vs. IRA: The differences and how to choose which is right for you

As we mentioned, there’s no harm in splurging once in a while, as long as your financial obligations are squared away.

If you don’t want to feel like you’re depriving yourself, set aside half of your bonus for a “responsible” purpose and use the other half however you’d like. This can give you the momentum you need to stay the course when it comes to your financial goals, while still enjoying the fruits of your labor.

Read more: How much of your paycheck should you save?