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Going for Gold 

Academy of Art’s new sports program is about spirit, marketing — and the chance to break even more rules.

Wednesday, Aug 27 2008

Page 2 of 5

Williams leans back in his chair and claims that "90-plus percent" of the recruits he's given his speech to have signed on the dotted line. But he says it isn't just recruits he's winning over. Williams claims that Mike Garrett and Darryl Gross — the athletic directors of USC and Syracuse University, respectively — pulled him aside at a recent convention. Their message: The Academy of Art's specialized areas of study threaten our recruiting efforts. "They said, 'We don't have what you have'" — majors such as fashion and 3-D animation. "'If a kid wants to go with what you have, how can we compete with that?'"

Gross, however, remembered a less monumental rationale behind this pep talk: "We were being complimentary and showing that Jamie Williams has hope! TONGUE IN CHEEK!" he wrote in an e-mail.

Medieval metaphors work well for Williams, since the Academy of Art's teams are named the Urban Knights. Of course, the feudal references also suit critics of the school, who accuse president Elisa Stephens of running it like a personal fiefdom.

As a for-profit, "proprietary" institution, whatever money isn't spent on staff costs, bus maintenance, and so on goes to the Stephens family as profit. The family has maintained a strict silence regarding the school's financial numbers and even obtained its real estate holdings with an air of secrecy, using a byzantine network of limited liability companies to purchase buildings — and obscure the real owners.

School instructors earn notoriously low wages — one current teacher told SF Weekly she draws roughly $9,000 a semester for teaching five classes. There is no tenured faculty, and a veteran full-time instructor said his $50,000 salary was top of the heap. So, while the notion of an art school inaugurating a sports program is strange, the idea of a for-profit institution going in for athletics is even stranger. After all, running a sports program is a marvelously efficient way to squander money. Recent NCAA statistics reveal that, among schools operating Division II programs without a football team, 93 percent lose money, with the average annual shortfall roughly $1.4 million. Incidentally, 93 percent of Division II programs with football also lose money, with the average deficit at $1.77 million. The academy, however, doesn't write off the millions it has sunk into athletics as a mere expenditure. It's an investment.

When asked, bluntly, why the Academy of Art needed a sports program, Williams was quick to drop the medieval references for another M word: marketing. "I see this place as kind of a Harvard or Stanford of art schools, but you don't know about it because athletics is usually the greatest marketer of an institution," he says.

It's an understandable rationale for an institution that hopes to more than double in size — and has recently added a school of multimedia communications with majors that veer away from the fine arts and toward more general interests. Williams happily claims that the academy can make anyone an artist — and while this is debatable, it is certainly willing to give anyone a shot. Unlike Harvard or Stanford, the academy has a 100 percent acceptance rate. Many of its current students were lured by ads aired on MTV. Perhaps in the future, those commercials will play on ESPN.

Williams and Stephens refused to disclose the school's athletic budget, but Williams claimed it was on par with other Pacific West programs. The athletic directors for those schools, meanwhile, readily revealed that they budget between $1.4 million and $3.8 million a year for sports — though none has the academy's startup costs or need to rent public facilities like Kezar Pavilion, which costs $150 an hour for practices and $2,000 to $3,000 for every volleyball or basketball game.

The academy's marked secrecy regarding its athletic budget won't last long. That data — and much more — must be reported to the Department of Education each season. Department officials in Washington said they expect to receive a report from the academy in 2009.

That notwithstanding, financial questions induce hostility. "Unfortunately, your agenda of searching for 'why a for-profit educational institution would want the financial burden of intercollegiate athletics at the Division II level' is contrary to our current priorities," Williams e-mailed SF Weekly early in the reporting of this article. "Please desist from calling and e-mailing our athletic administrative staff and coaches, as they've been instructed that the story is over."

The Academy of Art's harshest critics respect the school — just as Sherlock Holmes respected Professor Moriarty. "Their business model is miraculous," admits Brad Paul, San Francisco's deputy mayor for housing under Art Agnos. "They've figured out ways to make money no one else has."

While the Stephens family keeps the school's financial data a matter of speculation, extrapolating 11,334 students paying $670 per credit for undergraduates and $770 for graduates produces a figure exceeding $100 million a year for tuition alone. At a recent Board of Supervisors meeting, Paul took the academy's goal of 24,000 future students, multiplied it by a tuition total that included 2 percent yearly jumps over the next decade, and came up with the figure of $479 million in potential annual tuition by 2017. And yet charging tuition in exchange for a college education is not exactly a revolutionary business model. The academy's real genius came in assembling its real estate empire, which both schools and shelters ever-expanding numbers of those tuition-payers.

About The Author

Joe Eskenazi

Joe Eskenazi

Joe Eskenazi was born in San Francisco, raised in the Bay Area, and attended U.C. Berkeley. He never left. "Your humble narrator" was a staff writer and columnist for SF Weekly from 2007 to 2015. He resides in the Excelsior with his wife, 4.3 miles from his birthplace and 5,474 from hers.


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