                                 CODE OF VIRGINIA

BOARDS OF VISITORS; BACCALAUREATE PUBLIC INSTITUTIONS OF HIGHER EDUCATION;
INTERCOLLEGIATE ATHLETICS PROGRAMS (§ 23.1-1309)

A. As used in this section:
			&#8220;Athletics revenue&#8221; means the total revenue received by an
institution that is generated by any of the institution&#8217;s intercollegiate
athletics programs. &#8220;Athletics revenue&#8221; includes contributions; game
guarantees; income received from endowments and investments; income received
from the sale of food, game programs, novelties, and other concessions at an
intercollegiate athletics contest; income received from intercollegiate
athletics conferences for participation in bowl games, tournaments, and other
intercollegiate athletics contests; income received from the provision of
parking at intercollegiate athletics contests or other events associated with
intercollegiate athletics; rights and licensing; school funds; student fees;
support from third parties guaranteed by the institution, such as income
received from athletics camps, income received from television, and housing
allowances; and all other income from any other source generated by the
institution&#8217;s intercollegiate athletics programs.
			&#8220;Contributions&#8221; means any income received directly from
individuals, corporations, associations, foundations, clubs, or other donors for
the operation of an institution&#8217;s intercollegiate athletics programs.
&#8220;Contributions&#8221; includes amounts paid in excess of the face value of
an admissions ticket to an intercollegiate athletics contest or any other event
associated with intercollegiate athletics; cash; marketable securities; income
generated from preferential seating arrangements at intercollegiate athletics
contests or other events associated with intercollegiate athletics; and in-kind
contributions such as cars provided to an intercollegiate athletics program by
car dealers at no cost and apparel and sports drink products provided to
intercollegiate athletes and coaches at no cost.
			&#8220;Generated revenue&#8221; means all athletics revenue with the
exception of the subsidy.
			&#8220;Institution&#8221; means a baccalaureate public institution of higher
education.
			&#8220;Intercollegiate athletics program&#8221; means any athletics program
for a particular sport that is operated by an institution and governed by the
National Collegiate Athletic Association (NCAA).
			&#8220;Rights and licensing&#8221; includes income from radio and television
broadcasts; Internet and e-commerce rights resulting from institution-negotiated
contracts; revenue-sharing agreements with the NCAA or an intercollegiate
athletics conference; licensing; the sale of advertisements, trademarks, or
royalties; corporate sponsorships; and the value of in-kind contributions of
products and services provided to an intercollegiate athletics program at no
cost as part of such corporate sponsorship, such as equipment, apparel, isotonic
sports drinks, other sports drink products, or water.
			&#8220;School funds&#8221; means the direct and indirect financial support
provided by the institution to any of its intercollegiate athletics programs.
&#8220;School funds&#8221; includes state funds, tuition, tuition waivers,
federal work awards for student athletes, administrative costs, facilities and
grounds maintenance, security, risk management, utilities, and depreciation and
debt services.
			&#8220;Student fees&#8221; means any fees assessed by an institution against
a student that are used to support any of the institution&#8217;s
intercollegiate athletics programs.
			&#8220;Subsidy&#8221; means the sum of school funds and student fees.
			&#8220;Subsidy percentage&#8221; means the subsidy divided by the athletics
revenue, provided that revenues allocated to (i) support spirit groups
associated with any intercollegiate athletics program, (ii) meet any indirect
cost policy requirements, or (iii) debt service for previously approved
intercollegiate athletics capital outlay projects may be excluded from the
subsidy for the purposes of such calculation.
			&#8220;Ticket sales&#8221; means the sale of the right to gain admission to
an intercollegiate athletics contest or any other event associated with
intercollegiate athletics. &#8220;Ticket sales&#8221; includes sums received
from any associated shipping and handling charges and includes sales to the
public, faculty, and students. &#8220;Ticket sales&#8221; does not include (i)
amounts paid in excess of the face value of an admissions ticket to an
intercollegiate athletics contest or any other event associated with
intercollegiate athletics such as preferential seating arrangements or (ii)
pass-through sales transactions such as sales for admission tickets to bowl
games and conference and national tournaments.

B. The Auditor of Public Accounts, in collaboration with the Council, State
Comptroller, Department of Planning and Budget, and each institution, shall
develop and implement a standardized reporting format for each institution to
annually report its intercollegiate athletics revenue and expenses to the
Auditor of Public Accounts that shall include treatment of student fees and
classification of specific intercollegiate athletics programs and shall require
expenses for spirit groups, indirect cost policy requirements, and debt service
for previously approved intercollegiate athletics capital outlay projects and
other intercollegiate athletics capital outlay projects to be reported on
separate lines.

C. The subsidy percentage shall not exceed:

   1. 20 percent for NCAA Division I-A institutions affiliated with the Atlantic
   Coast Conference, Big Ten Conference, Big 12 Conference, Pac-12 Conference, or
   Southeastern Conference;

   2. 55 percent for NCAA Division I-A institutions affiliated with conferences
   other than the Atlantic Coast Conference, Big Ten Conference, Big 12
   Conference, Pac-12 Conference, or Southeastern Conference;

   3. 70 percent for NCAA Division I-AA institutions;

   4. 78 percent for NCAA Division I-AAA institutions;

   5. 81 percent for NCAA Division II institutions that operate intercollegiate
   football programs;

   6. 85 percent for NCAA Division II institutions that do not operate
   intercollegiate football programs;

   7. 89 percent for NCAA Division III institutions that operate intercollegiate
   football programs; and

   8. 92 percent for NCAA Division III institutions that do not operate
   intercollegiate football programs.

D. Each fiscal year, any percentage increase in the subsidy at an institution
that complies with subsection C shall be matched by a like percentage increase
in generated revenue, except that each such institution shall utilize a rolling
average of the change in generated revenue and student fees over the immediately
preceding five years for the purposes of such calculation.

E. When necessary, each institution shall submit to the Governor and the General
Assembly for approval a plan that reduces the subsidy in accordance with targets
outlined in the plan over a five-year period until the subsidy percentage
complies with the requirements of subsection C.

F. The Auditor of Public Accounts shall annually review each institution&#8217;s
progress towards meeting the requirements of each plan approved pursuant to
subsection E as part of his annual audit pursuant to &#xA7; 30-133.

G. Failure to meet the progress requirements of each plan approved pursuant to
subsection E for one year, as determined by the Auditor of Public Accounts,
shall result in such reduction of the financial and administrative operations
authority granted to the institution pursuant to the Restructured Higher
Education Financial and Administrative Operations Act (&#xA7; 23.1-1000 et seq.)
as the Governor or General Assembly determines.

H. Failure to meet the progress requirements of each plan approved pursuant to
subsection E for two consecutive years, as determined by the Auditor of Public
Accounts, shall result in revocation of all financial and administrative
operations authority granted to the institution pursuant to the Restructured
Higher Education Financial and Administrative Operations Act (&#xA7; 23.1-1000
et seq.).

I. The board of visitors of any institution that seeks to add a major
intercollegiate athletics program such as football or basketball or change the
division level of any of its existing intercollegiate athletics programs shall
first submit to the Intercollegiate Athletics Review Commission (Commission)
established pursuant to Chapter 57 (&#xA7; 30-359 et seq.) of Title 30 a plan
and recommendations for financing the addition or change. The institution shall
not in any way undertake any such addition or agree or commit to any such change
until it has received the findings and recommendations of the Commission
pursuant to &#xA7; 30-360. Any such addition or change is subject to the
approval of the General Assembly expressed in the general appropriation act. The
board of visitors of any institution that adds a non-major intercollegiate
athletics program shall report such decision within 15 days of the board&#8217;s
action.

HISTORY: 2015, c. 704, § 23-1.2; 2016, c. 588.