I know that if the program becomes consistently competitive, it will definitely make a difference in terms of attendance both from students and the community. I have seen it happen for the VCU Rams. Even before their magical Final Four run, they had been packing their home court and last week's bracket buster game was the 17th consecutive sellout.
Strangely enough, the other Div 1 program in the city - UR Spiders - has had trouble filling their home court despite having more of a tradition of success. Of course, they are a smaller private school situated in a suburban county even though it is only a few minutes outside of the city.