LONE TREE — Colorado high schools are about to make a lot more money hosting playoff games and events.

The CHSAA Legislative Council voted to amend the association’s tournament and playoff finance structure on Tuesday at the DCSD Legacy Campus. Previously, host schools paid a percentage of their playoff gate revenue to CHSAA and also a portion to help reimburse visiting teams for traveling.

But under the new amendment — which passed overwhelmingly via a 56-14 vote — each member school will now pay an annual playoff fee to CHSAA, with the amount based on what basketball classification that school is in. With that fee paid, schools now get to keep the profits from hosting playoff games and events such as regionals, without having to share that revenue with CHSAA.

“This is a structural and fundamental change to the way that we’ve done things,” CHSAA commissioner Mike Krueger said. “This approach is more of a cost-share, because we are a membership that’s a benefit-share approach.”

The amendment came to the floor on Tuesday following months of research by CHSAA’s Tournament & Playoff Finance Committee, which found that schools hosting playoff games and tournaments (such as wrestling or volleyball regionals) were consistently finding themselves in the red.

For example, Tournament & Playoff Finance Committee chairperson Paul Cain, the athletic director for the Mesa County Valley School District, said that 85% of last year’s hosts for wrestling regionals lost money. With this change, that deficit would now be a $5,000 profit for each host school.

The association’s tournament and playoff finance reports reveal that postseason money accounts for 5-10% of CHSAA’s organizational budget, and Cain argues that “the teams that are in the playoffs are currently subsidizing this money, and now, this would go across the membership.”

CHSAA Director of Finance Sarah Vernon-Brunner said this amendment will have “no financial effect on CHSAA.”

“The committee … looked at a five-year average of playoff revenues and used that as the basis for determining the total (playoff) fees,” Vernon-Brunner wrote in an email to The Denver Post.

While CHSAA membership fees will remain the same for a third straight year in 2024-25 — each school’s membership dues are $948, plus a $161 participation fee for each sport/activity — this playoff fee will now be tacked on to schools’ costs. Class 1A schools will pay $600; 2A $800; 3A $1,000; 4A $1,400; 5A $1,900 and 6A $2,600.

Two of Colorado’s largest districts, Denver Public Schools and Aurora Public Schools, opposed the amendment.

In a statement to The Denver Post, DPS said that the amendment’s “year-over-year projections show significant financial impacts to the district,” and DPS district athletic director echoed that sentiment on Tuesday.

“We ran the models in Denver with our current structure,” Bendjy said. “We lost $2,000 over the last two months in postseason activities, but with this proposed structure and the same events, we’re now down $16,000. That’s a loss of 800%. Philosophically, this is not a financial structure we can get behind at this time.”

APS district athletic director Casey Powell also spoke out against the amendment ahead of its passing vote.

“This will create an absolute stable function for CHSAA, but it will completely flip my budget personally, upside-down, for the way I hold my budget,” Powell said. “Because I don’t get that (new) revenue, because my schools don’t regularly make the playoffs. So to say I’m going to get that (playoff) fee back is not true.”

Krueger acknowledged those concerns, but said that “for all intents and purposes, this is a membership due.”

As part of the amendment, in a head-to-head playoff game, if the host makes $1,000 or more in net income, then 25% of that gets paid to the visiting team. Cain said the 75/25 split would be done on an “honor system.”

Krueger also added that this new model would incentivize schools to host regional tournaments, rather than disincentivize them, and that districts like DPS and APS could possibly recoup their playoff fee by hosting those tournaments.

“If you host a regional, this should in some ways help, because events you wouldn’t look to currently host maybe that would change and encourage our membership to host these events,” Krueger said. “And if you deserve the right to host (based off playoff seeding), should our system be one in where it costs you significantly to host that (game or) event?”

To Krueger’s point, this fall, Cherry Creek athletic director and Tournament & Playoff Finance Committee member Jason Wilkins said the Bruins took a loss on their first-round football playoff game despite a couple thousand people in attendance at the Stutler Bowl.

Under the current model, CHSAA receives 10% of the gross receipts and 70% of the net proceeds off football playoff games from host schools. In basketball, which is traditionally the association’s biggest playoff money-maker, CHSAA’s due 20% of the adjusted gross receipts.

Wilkins said that cost structure, in addition to having to pay ticket-takers, police, security guards, officials and visiting travel expenses, “doesn’t leave a lot of opportunity for profit for hosts.”

Mead athletic director Chad Eisentrager doubled down on Wilkins’ opinion, arguing that profits from playoff games and events “should stay within those communities that are putting in the work, the time and resources.”

“Three years ago we hosted Roosevelt in the state semifinals for football,” Eisentrager explained. “We had almost $13,000 in revenue, and we lost money as a result of the security and all the other fees that went along with running that event.

“So in fact, we are losing money on these (playoff events), when my community, who had a right to host that event, got to keep zero of that revenue. This (new amendment) spreads (the cost burden) out, and if you’re successful enough to host one big basketball game, one big football game or some of these other (postseason) events like regional wrestling, (you’ll make the fee back).”

Cain also argued that the new amendment creates “some flexibility for schools on how they treat the postseason.” For instance, schools wanting to boost attendance and atmosphere can now elect to not charge their students for postseason games, so long as they let the visiting students in for free, too. Before, there was a fee for not charging a gate.

And the Tournament & Playoff Finance Committee said that in addition to increased revenues for many schools, the amendment also eliminates a lot of paperwork that was convoluting the money trail.

“One of the things (the committee) has heard is, visiting schools always don’t get their (travel) money like they’re supposed to,” Wilkins said. “Such-and-such school is supposed to pay, but it’s not always that simple, or that timely, or you have to keep asking. Different districts have different financial systems. So there’s a lot of (red tape), in conjunction to the time filling out a lot of these forms.”

The amendment will go into effect for the next two-year CHSAA cycle.

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