Frequently Asked Questions about Proposed Renovations at Michigan Stadium

Does Michigan Stadium need renovating?

Yes, the stadium needs significant renovations. Most in the Michigan family agree that the stadium needs a modernized press box, expanded seating for people with disabilities, more bathrooms, wider aisles, better pedestrian circulation for greater public safety, and other general maintenance. The Athletic Department has estimated the cost of these basic renovations at $60-$70 million.

Is it possible to fund these renovations without revenues from proposed private luxury boxes?

Yes. The Athletic Department’s 2004-2005 surplus topped $17 million, according to official figures submitted to the U.S. Department of Education. The previous year’s surplus was $8 million. With official audits indicating various Athletic Department reserves of approximately $33 million, and revenue from seat licenses projected to reach $12 million annually beginning in 2006, funding a once-in-a-generation renovation could readily be achieved with existing resources over a relatively brief period.

What are the projected revenues from the proposed private luxury boxes, anyway?

No financial models or business plans are currently available, according to the Athletic Department. All projections associated with this proposed $250 million expenditure have been based on informal, back-of-the-envelope estimates and anecdotal evidence.

According to the Ann Arbor News of January 20, 2005, prices for boxes at midfield could reach $85,000, with prices descending to $45,000 toward the end zones. Assuming all 79 proposed boxes were leased at the top price ($10,000 more than the most expensive, mid-field boxes at OSU), they could generate $6.7 million annually. That represents a return on investment of less than 3% -- not even enough to cover the debt service on construction. The bottom line? The luxury boxes would lose money.

To put this in perspective, based on current prices and average seat-license fees, the stadium could generate similar revenue from adding approximately 10-15 more rows of bleacher seating around the existing rim. These additional seats would more than offset the estimated number of seats that will be consumed by broader aisles, wider seats and greater handicap access. Such an expansion would also be in keeping with the character of the existing structure. Alternatively, a temporary renovation surcharge of $10 per ticket could generate more than $7 million annually – a small price to pay to save our iconic stadium.

Would the lease of private luxury boxes at premium prices be dependent on changing the stadium’s current ban on alcohol?

Yes. Customers asked to pay up to $85,000 annually for luxury boxes will expect to enjoy beer, wine and liquor in their VIP boxes. However, maintaining the existing ban on alcohol – a key to Michigan Stadium’s friendly, safe atmosphere and reputation – would significantly reduce the prices the boxes can command. For examples of the embarrassing controversy surrounding alcohol at similar facilities, see attached articles about MSU, Iowa and other institutions.

Would a $250 million renovation impact the University’s finances?

Yes. The massive, $250 million project currently under consideration would encumber roughly one seventh of U-M’s borrowing capacity. This could significantly limit resources available to support the University’s academic and medical endeavors, and do so at a time when state support for higher education is already severely strained.

Is it possible to renovate the stadium without private luxury boxes?

Yes. Unfortunately, the relevant Request for Proposal issued on January 17, 2005 (see attached document) did not seek such alternatives. It specifically requested luxury boxes, euphemistically described as “enclosed seats for fee based utilization by the public.” The Regents might consider requesting a more comprehensive range of non-box alternatives to review (such as the models outlined above) before making a final decision on the form renovations should take.

Can Michigan student athletes continue to compete and win without revenue from private luxury boxes?

Yes. Federal data confirms that U-M already spends more per varsity athlete ($160,000) than any school in the country. U-M also spends more on athletically-related student aid than any other Big Ten competitor – more than $11.3 million in 2004-2005 alone. It also provides more athletically-related student aid – $13,922 per varsity athlete – than all other Big Ten competitors except Northwestern. Financial aid correlates strongly with tuition at the various institutions, and because Northwestern has the highest tuition in the conference by far, it must provide more financial aid to its athletes.

A more significant figure to consider is the fraction of the undergraduate student body that competes in varsity sports. From this perspective, U-M (1 out of every 29 students) ranks second only to Northwestern (1/17) and far ahead of Ohio State (1/36), Penn State (1/47), Michigan State (1/48) and others in the league.

And Michigan student-athletes compete with the very best in the nation. In 2004-2005, the Wolverines boasted 5 Academic All-Americans, 185 Academic All-Conference athletes, 67 All-Conference athletes and 43 All-American athletes. The Maize-and-Blue claimed 8 conference championships, while 23 of 25 teams qualified for the NCAA national championships. And to cap the year with a great Michigan victory, the women’s softball team won the national title – the 52^nd national championship in the history of Michigan athletics.

Michigan student-athletes – like a century of “champions and best” who came before them – earned these victories and honors without revenue from a single private luxury box. Once a basic (non-box) stadium renovation is paid off, annual seat license revenue could be redirected to endow athletic scholarships for future generations of Michigan student-athletes.

Would the proposed private luxury boxes affect the stadium’s status as America’s largest?

Yes. As diagrammed in the Ann Arbor News on January 20, 2005, the private luxury boxes would stretch from end-zone to end-zone on both sides of the stadium, at almost twice the height of the current press box, and consume existing seats. Apart from their negative aesthetic and social impact, these luxury box structures would also cap future expansion throughout most of the stadium. Any addition of seats would necessarily be limited to the upper reaches of one or both end zones.

Would the proposed private luxury boxes undermine the historic architecture of America’s quintessential, classic stadium?

Yes. While many other institutions have chosen to alter their stadiums with private luxury boxes, none started out with the famously understated, classic subterranean bowl that Michigan fans have known and loved since 1927. Adding towering banks of private luxury boxes will radically alter the unique, historic fabric of this iconic structure and leave arch-rival Notre Dame with America’s only major stadium completely free of advertising and luxury boxes. We might ask: does Notre Dame value its tradition more than Michigan? The fact that Michigan Stadium is one of the very last of its kind makes protecting its traditional form and character all the more important.

Would private luxury boxes undermine the game day experience of most fans?

Yes. Building towering luxury box structures would cast significant shadows over the stands and playing field much earlier in the game, much earlier in the season – a significant degradation of the stadium’s traditional sunny, open atmosphere.

Building boxes would also cast long shadows over the egalitarian values which U-M has always championed. For 126 years now – whether at Regents Field, Ferry Field or in Michigan Stadium – the Maize-and-Blue faithful have stood together, shivered together, cheered together and won together, side by side. Private luxury boxes represent the very antithesis of that tradition, dividing Michigan fans by income and undermining the unity, excitement and camaraderie that Michigan fans of all ages and backgrounds share as they experience the game together. In short, the proposed private luxury boxes just aren’t “Michigan.”

Would adding private luxury boxes be controversial, upsetting loyal alumni?

Yes. While virtually all members of the Michigan family support basic stadium renovations, thousands – including many respected leaders – are deeply opposed to adding private luxury boxes. Many recall the debacle of “the halo” when, overriding a public outcry, the U-M “renovated” the stadium in a way that fans found so offensive that it hurt fundraising. We believe the University should actively engage a broad range of U-M advocates in this debate – not just a narrow subset – and pursue renovations that unite us, honor the University’s deepest values, and make every Wolverine proud.

Is it important for the University to facilitate a thorough, open and deliberate discussion of the stadium’s future?

Yes. The current luxury box proposal would radically transform an iconic structure on campus and impose lasting economic, political and social costs on far more than the Athletic Department, season ticket-holders or those attending games. Therefore, a public, thorough and transparent discussion of all implications and possible architectural alternatives is essential – not just for the stadium’s future, but to uphold the best U-M tradition of open, honest intellectual exchange. A rushed process or one that is not perceived as fair open, and transparent, would ignite the same criticisms as “the halo” did – but with irreversible consequences.

Is there a win-win for all constituencies engaged in debating the stadium’s future?

Yes. After facilitating an open, thorough, measured and transparent exploration of all possible options – with broad input from diverse viewpoints – the University could move ahead with a major renovation of Michigan Stadium that is a win-win for everyone in the Michigan family. Given the common ground that already exists, this renovation might include a modernized press box (incorporating appropriate facilities for university business such as fundraising and recruiting of faculty and athletes), expanded seating for people with disabilities, more bathrooms, wider aisles and exits for better circulation and greater public safety, and other necessary maintenance. If size is a primary consideration, we could expand general bleacher seating around the stadium’s perimeter, doing it in way that honors the stadium’s classic architecture, upholds Michigan’s egalitarian tradition, and protects the stadium we all love for future generations.

Let’s Go Blue!