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March 5, 2024

Financials Matter

"It's Not Just About Finance"

Free Means We Pay for It

Attention grabbing athletes are becoming creative.

Example:  A recent high-profile NBA player is making headlines about how he’s promising to pay for an Akron high schools’ costs of operations.  This includes FREE EVERYTHING for all the kids who go to school and FREE TUITION for those who attend Akron University (providing they graduate from high school).

Hold on!

First, we all know that nothing is for free.

Second, when an athlete says he’s going to offer everything for free, you probably should look deeper into what “Everything” means.

Cleveland’s newspaper The Plain Dealer had this to say:

“The exact breakdown of expenses for the new I Promise School is unclear, since the district and the LeBron James Family Foundation are still sorting out final details of their contract. But the district will pay more than half the costs – perhaps around 75 percent – once it is fully running.

 

The foundation says it’s spending about $2 million for the school’s first year, including startup costs. It has also committed to spending $2 million or more a year when the school has grown to capacity. The exact amount is still to be determined.

 

Though James will have a huge influence on the school, I Promise will be run by the district.

It’s a district-owned building. The district will hire and pay the teachers and administration. Kids will ride district buses to school. And they will all eat the free breakfast and lunch the district gives all students.

I Promise will eventually cost about $8 million a year to run out of the district’s regular budget, covered mostly by shifting students, teachers and money from other schools, the district says.

The $2 Million from the foundation amounts to 2.25% of Mr. James’ annual income.

If you made $50,000 a year and wanted to be just as generous (percentage wise) your contribution would be $1,125.

But, of course, no one would probably notice.

Kinda puts things in perspective, don’t ya think?

See how attention grabbers pick your pocket (HERE).

 

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