ORLANDO, Florida -- As the first Division II Chancellors and Presidents Summit closed June 26, it was apparent that the event marked a start rather than a finish for determining how to achieve Division II goals over the next several years.

The 140 presidents in attendance appeared united in their support of Division II's philosophy and purpose -- and also united in the belief that more needs to be done to acquire greater public understanding and support.

"We must work on our own identity and get out of the shadows of Division I," said Presidents Council member Eddie N. Moore Jr., president of Virginia State University.

The CEOs were given valuable tools to accomplish that task. They were provided with significant research from Competition Policy Associates about Division II finances, and they also were provided access to a media researcher and executives from ESPN-U and CSTV (see related story, page 15).

The research, the centerpiece of the summit, is directly related to the Association's strategic plan, which calls upon institutions to make more data-driven decisions about intercollegiate athletics. The study was designed specifically to provide institutions that are considering reclassification to Division I with information that has not been previously available.

"Often, perhaps even generally, the decisions (to reclassify) are made because of significant external influence, because of the perceived importance of divisional status to the reputation of the school or because of the unsupported belief that 'moving up' will benefit the school financially," NCAA President Myles Brand said in a June 25 address.

The study, "Empirical Effects of Division II Intercollegiate Athletics," focused on three key questions:

SIZE=2> How do Division II finances compare to the finances of other divisions?

• What are the financial returns to increased athletics spending by Division II institutions?

• What are the financial returns from moving from Division II to Division I?

The available data permitted the authors to look at 20 institutions that reclassified between 1994 and 2002. Another 30 institutions reclassified during the 1985-93 period, but that timeframe preceded the federal Equity in Athletics Disclosure Act, which provided much of the material contained in the Orszag study.

The research showed that Division II revenues and expenses are substantially lower than those found in Division I. An average Division II program with football has annual revenue of about $2.6 million and expenses of $2.7 million. Division I-AA averages $7.2 million in revenue and $7.5 million in expenses.

However, the study also showed that Division II institutions have much smaller operating losses and lower levels of institutional support. Not counting institutional support, state support or student activity fees, average football-playing institutions in Division II have net revenue of minus $2.1 million, compared to minus $5.2 million for Division I-AA institutions. In addition, the study revealed that the percentage of total institutional spending devoted to athletics at Division II schools (2.6 percent) is lower than in Division I-AA (3.6 percent)

In examining the effects of increased athletics spending for Division II, authors Jon and Peter Orszag determined that a $1 increase in athletics operating spending is associated with a statistically significant decrease in operating net revenue. They also confirmed a finding -- previously determined in Division I -- that increases in football spending do not equal an increase in football winning, which does not equal an increase in football revenue. The authors also concluded that there is no evidence that increased operating expenditures on sports by Division II institutions affect measurable academic quality or that increased operating expenditures on sports affect other measurable indicators, including alumni giving.

As for the financial returns of switching divisions, the authors found no economic benefits. On average, institutions that switch divisions experienced an increase of $3.7 million in spending against a $2.5 million jump in revenue ($2 million of the additional revenue comes from increased institutional support, state support or fees). The largest changes in spending came from grants-in-aid, coaches' salaries and team travel; the largest revenue changes involved cash contributions, ticket sales and NCAA/conference distributions.

The Orszags also found that many schools that switched did not engage in a detailed cost-benefit analysis of changing divisions. Among those institutions, some respondents said that athletics economics was not the primary factor. "You are who you play," said one respondent while another said, "It is an honor to play against the best, even if you lose by 40 points."

During the summit, CEOs of institutions considering moves to Division I were candid about their plans. In general, they said that the motivation to consider reclassification was based on retaining rivalries or on keeping their institutions competitive in all ways.

North Carolina Central University President James Ammons said his institution has examined a move to Division I but that it also has elevated its academic and research profiles because of how high those bars are set in those areas by nearby Duke University and the University of North Carolina, Chapel Hill.

"Our motivation is bigger than merely the game," he said. "We are motivated ... to train leaders grounded in academic excellence."

Even so, Ammons and other presidents of larger programs were interested in the status of a proposal to decouple football classification from an institution's membership division. The idea, which would group football teams by establishing floors (rather than ceilings) on the number of scholarships offered, was first broached at the 2005 Convention and has remained a popular concept with Division II audiences. However, Brand said that while the idea may have merit, it has not yet caught on in Division I.

While membership loss to Division I was on the minds of many presidents, others said that the real issue has more to do with how Division II institutions will deal with the funding crisis in higher education.

Drew Bogner, president of Molloy College, said he would like to see more data about the overall effect of athletics on the university. "If you're going to invest in athletics, what's the return?" he asked. Pfeiffer University President Charles Ambrose, a member of the Presidents Council, said, "We need to know about the cost benefit of intercollegiate athletics to our total institution. It's tough to pull that out, but they (the Orszags) are going to continue to work at it."

Other CEOs said they didn't know where they were going to find the money to invest in education, let alone athletics. They wondered how much longer their programs can deal with soaring tuition, unpopular fees and increasingly parsimonious state legislatures. "That will become another dimension for this dilemma," said Roland E. Barden, president at the University of Minnesota, Morris.

However, Grand Valley State University President Mark Murray said that such factors emphasize the need for his peers to focus on the benefits of Division II membership. He said his school, which has won the last two Directors Cups for all-around athletics excellence and has an enrollment of about 22,000, has no interest in reclassifying to Division I.

"I get the pressure all the time, and it's a standard question that we have to answer," he said. "But I'm in heaven in a place where I can spend more time on core academic issues than on athletics."

Murray suggested that institutions considering reclassification would be aided by a template that would enable them to plug in basic questions that would permit them to make a five- to seven-year projection about reclassification ramifications.

Jerry McGee, president of Wingate University and chair of the recently formed Division II Football Task Force, said he understands when boards and presidents seek to improve the image of their institutions. But he said that athletics is a poor choice to accomplish that outcome unless the school is able and willing to devote the necessary resources.

"I have seen institutions move to Division I and find they can't compete even after spending a tremendous amount of money," he said. "Sure, you're on the ESPN crawl, but when you're on the short end of a 54-3 score each week, it doesn't do much for you."

Presidents Council member Karen Morse, president of Western Washington University, told of how she had recently lost a major athletics donor because she resisted his insistence that the institution reclassify to Division I. She offered the group a rhetorical question.

"If someone provided you with the money to go Division I, would you go?" she asked. "I asked a few presidents that question, and the general response was, 'I would have to think about it.'

"But I know what I would do. I would do my best to persuade that donor to use that money to make us a better Division II school."

Hard copies of the Orszag study will be distributed to all Division II chancellors and presidents. The report also is available in the Division II section of NCAA Online (www.ncaa.org).