Big sports wins mean big money for campuses

Royalties pay for scholarships

Staff WriterApril 25, 2010 

— You won't see Jee Lee on the court at the Smith Center anytime soon, but make no mistake: He's at UNC-Chapel Hill on a basketball scholarship.

Lee is one of more than 950 students who got scholarships this year funded by the sale of the university's licensed merchandise. Though UNC-CH is always a popular brand, sales of its apparel surged after the 2009 national basketball championship, providing the university with $4.2 million in royalties - $400,000 more than the previous year.

Schools can do what they please with the merchandise royalties. Duke, this year's NCAA men's basketball champion, puts the royalties in a general fund for administrators to spend as they like.

At UNC-CH, that money goes to the student aid office for need- and merit-based scholarships.

The Chapel Hill campus gets a 10 percent royalty on the wholesale price of every T-shirt, hat and other piece of apparel sold with a licensed image of Rameses, the Tar Heel or any other university logo. The extra royalties UNC continues to receive from the 2009 national title are expected to provide financial aid for 90 additional students next year.

"Championships matter," said Shirley Ort, director of scholarships and student aid. "They do account for much more money."

For a state university that has pledged to meet all the demonstrated financial needs of its students, the extra royalties gave UNC a significant boost as the recession forced more students to apply for financial aid.

Along with some extra federal funding for Pell Grants and work-study money, the additional royalty funding helped Ort's office patch together aid packages for the 1,300 more students who qualified for it this year.

"It came at a wonderful time," Ort said. "We had so many more students applying and qualifying for need-based aid."

Easing burdens

About 38 percent of students qualified for aid this year, Ort said.

Unlike many scholarships, the royalties fund is unrestricted, and students can receive up to $5,000 from it, depending on their financial situations.

For most students, the royalty grant isn't the make-it-or-break-it scholarship that decides whether they go to college. But it could replace a loan, alleviating the post-graduation debt burden.

When he enrolled at UNC-CH, Lee didn't know he would be receiving money from the royalty fund.

Lee, 18, grew up in suburban Charlotte, an only child whose parents own a fish market. He received two other scholarships totaling $4,000 annually, and his parents were prepared to pay the rest of the $19,000 or so in tuition, fees, room, board and incidentals for an in-state student this year.

Then, the royalties grant, for $1,398, appeared on his financial aid statement.

"I used it for the cost of books, so it lessened the load on my parents," said Lee, who is studying biology with an eye toward medical school.

National championships are big business.

They bring loads of extra attention to universities in the form of media coverage, and high-profile titles won by football and basketball teams routinely lead to both a bump in applications from prospective students and donations from giddy alumni.

Perhaps no school has enjoyed more success of late than the University of Florida, which claimed national football titles in 2006 and 2008 and basketball championships in 2006 and 2007.

The payoff has been huge. Those four national championships resulted in more than $2.8 million in extra revenue. Florida splits the royalties evenly between its university and athletics department; the biggest beneficiary has been the Florida Opportunity Scholarship program, a financial aid program that guarantees a full ride for low-income students who are the first in their families to attend college.

"It makes it possible for some young people to go to college that may not have otherwise," said Steve Orlando, a university spokesman.

'No small deal'

At Duke, the national championship victory over Butler University this month set off a spending spree at the campus bookstore and elsewhere, said Jim Wilkerson, Duke's director of trademark licensing and stores operations.

He anticipates about $2 million in extra sales of Duke merchandise in the campus bookstore and on websites in the next three months or so.

Duke generally receives between $900,000 and $1.3 million in royalties annually; the basketball title will likely net an additional $600,000 or more, Wilkerson predicts.

"It's no small deal," he said, adding that some portion of the extra revenue will be used by the athletic department to fulfill federal Title IX requirements related to women's sports. "There are plenty of good uses for it, and we're happy to have it."

Lee, the UNC-CH freshman, certainly appreciates his small chunk of the national championship pie. But it has also made him re-evaluate his view of scholarships. Would he have received this money if UNC hadn't beaten Michigan State last year to win the national championship?

"It pokes at your pride a little bit," he said. "You'd think you get a scholarship because of your hard work, not the basketball team's success." or 919-932-2008

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