Big Bucks, Big Buyouts: Public universities shell out millions of dollars firing coaches who didn’t win enough

Most of that money goes to football coaches as schools chase gridiron glory
Published: Sep. 19, 2022 at 11:03 AM HST
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LAWRENCE, Kansas (InvestigateTV) - For many college football coaches, it pays to get fired.

Gus Malzhan received more than $21 million after Auburn sent him packing at the end of the 2020-21 season.

Two years removed from its 2019 national championship, LSU fired coach Ed Orgeron and paid him more than $16.1 million.

Arizona paid coach Kevin Sumlin $7.5 million in 2020 to leave after the football team lost to rival Arizona State 70-7.

And then there’s Kansas, which fired five coaches between 2011 and 2020 even as the university faced budget deficits and academic cuts. The school gave those coaches and their staffs more than $27.8 million in severance payments.

As the 2022-23 football season begins, public universities are on the hook this year for more than a $1 billion in severance payments if all of their coaches let go, according to an InvestigateTV analysis of more than 100 head football coaches’ contracts.

The majority of those coaches are likely not to be dismissed by their schools. But some will, as happens every year.

Last year, 21 head coaches were either fired or resigned because of performance issues. And schools shelled out more than $63.2 million to end their tenures.

This year, Nebraska’s Scott Frost is the first casualty. The university parted company with Frost on Sept. 11 and will give him a $15 million parting gift. During his time at Nebraska, Frost amassed a included almost twice as many losses as wins. But if officials had waited until Oct. 1, Frost’s buyout would have been cut in half, per the terms of his contract.

Each year, the football stakes are that much higher.

The buyouts are big because the annual compensation paid to coaches continues to rise.

Take the Big 10 for example.

Eager to keep Mel Tucker on the sidelines at Michigan State, donors last year agreed to help fund a 10-year, $95 million contract for him.

Penn State quickly followed, locking down football coach James Franklin with a 10-year, $70 million deal.

This spring, Ohio State extended Ryan Day’s contract this spring to make his annual salary - $9.5 million – match Tucker’s. The day after, Ohio State announced that it was raising tuition.

Yet none of those coaches has won a national championship for their universities. But all, if dismissed, would walk away with 100% of what they would have been paid if they remained on the sidelines through the end of the contract.

Across the football spectrum, university presidents and trustees are signing off on these massive contracts.

‘Institutions are throwing money away’

InvestigateTV analyzed the Knight-Newhouse College Athletics Database at Syracuse University for the 235 public universities that play Division I athletics. The data comes from financial data reported to the NCAA annually and collected by Syracuse.

Since the fall of 2004, Division I public universities have paid out more than $1.1 billion – or $1.3 billion in today’s dollars due to inflation - to hundreds of coaches in every sport who were let go, largely, because their teams did not win enough.

“It’s obvious that institutions are throwing money away that could be used to, you know, enhance the education, health, safety and well-being of student athletes,” said Len Elmore, a former star basketball player at the University of Maryland and a member of the Knight Commission on Intercollegiate Athletics, a group that tries to rein in spending on college sports.

That $1.1 billion, for example, could pay for nearly every undergraduate and graduate student enrolled at Auburn to attend that school for a year for free.

And, a majority of that money – 75% of it – has gone into the pockets of football coaches who played in the Football Bowl Subdivision of Division I athletics. The FBS includes schools that make up the five power conferences – ACC, SEC, Big 10, Big 12 and the PAC-12; Notre Dame and schools that belong to the lower profile conferences, such as the MAC and Sun Belt.

Among those schools, athletics is big bucks, with expenses topping more than $133 billion, or $162.5 in today’s dollars, over the last 17 years. That’s enough to cover for a year the entire university budget for 102 schools with the highest academic expenses.

Most of those athletic departments rely on infusions of funding from the university itself and students to make ends meet.

“A lot of parents don’t realize; they just see your tuition and fees,” said B. David Ridpath, an Ohio University professor who teaches sports business and a member of The Drake Group, another group that is critical of big-time athletic spending. “Fees have increased, according to research I’ve done, at a rate almost 14% faster than tuition.”

Other key takeaways from the Knight-Newhouse data include:

  • That students through mandatory fees have paid more than $16.8 billion dollars – or $20.6 billion when adjusted for inflation – to their athletic departments. Of the 113 public FBS schools, only 17 – eight of which are members of the Big 10 - have never taken student fees for athletics.
  • That the universities have contributed more than $17.8 billion – or $21.6 billion in today’s dollars – to athletic department budgets. Only six universities have not kicked money into athletic departments: Georgia, LSU, Nebraska, North Carolina, Oklahoma, Penn State.
  • That only three schools have never subsidized its athletic department budgets with student fees and university subsidies: LSU, Nebraska and Penn State.
  • That among the FBS schools, only seven have never made a severance payment to a football coach - Arkansas State, Boise State, Northern Illinois, Ohio University, Oklahoma State, South Alabama, and Toledo. Arkansas State and Boise State are the only two FBS schools that haven’t ever bought out a coach in any sport.

The price of chasing championships isn’t cheap

The largest buyouts belong to the blue bloods of big-time athletics. They have a history – and an expectation – to win a lot.

But some also are quick to move to the next coach when losses mount.

Since 2004, the five largest total severance payments paid out for coaches in all sports belong to the following universities:

  • Auburn: $48 million (actual), $56.6 million inflation adjusted
  • Tennessee: $42.5 million (actual), $51.6 million inflation adjusted
  • Nebraska: $39.8 million (actual), $47.2 million inflation adjusted
  • Kansas $34.9 million (actual), $41.2 million inflation adjusted
  • Texas: $32.8 million (actual), $37.1 million inflation adjusted

But Kansas stands out because 80% of those severance payments have gone to the five football coaches and their staffs who were fired over a 12-year-period.

Since 2010, the athletic department has paid out more than $27.8 million to part ways with Mark Mangino, Turner Gill, Charlie Weis, David Beatty and Les Miles.

“It’s startling,” said Shawn Leigh Alexander, an African American studies professor who has been at the university for 15 years and is a sports fan. “We have gone after these big names . . . and none of them have been here for more than two years. It’s been a failure. It’s been an absolute failure.”

Kansas is chasing football glory despite the fact that the Jayhawks have finished in the AP top 25 only once since the 2000 season. It hasn’t won a conference championship since 1968.

Kansas athletic director Travis Goff told the University Senate earlier this year that the school needs a successful football program.

According to a Feb. 3 article in KUsports.com, Goff said the likely reduction in conference revenue when Oklahoma and Texas defect to the SEC in 2023 makes it more critical than ever for KU to be successful both on the field and financially.

“It is not a surprise to anyone that we have been an underperforming program in the way of wins and losses, and certainly we have been an underperforming program as it relates to financial viability,” Goff said. “To me the takeaway is exceptional opportunity. I really believe in the world of this level of intercollegiate athletics that the University of Kansas has more upside, certainly as much upside as anyone out there, because of the potential within that program.”

In men’s basketball, Kansas is a powerhouse, with six national championships. Its coach, Bill Self, has reigned on the Jayhawks court for 19 years.

But Kansas football generates far greater income – more than $40 million – than men’s basketball, which brings in about $16 million.

In the meantime, on Kansas’ academic side, the university has faced deficits and cuts.

After winning just three games in two years, Kansas sent away Les Miles with nearly a $2 million check. It came on the heels of an $11 million budget cut to the university.

“So morale at the university is already absolutely dismal,” Alexander said. “And one person is getting paid ($2) million.”

In addition, the athletic department has relied on more than $41 million in student fees and university subsidies as part of its revenue stream since 2004.

“The image that we talk about, as we started with that the KU Athletics in the University of Kansas are two separate entities, but they’re not. They’re tied, sometimes by very loose strings, but they are tied,” Alexander said.

It’s a revolving door of football coaches at some schools

But it’s not just Kansas chasing the football glory.

Since 2004, UCLA has had three top 25 finishes and seven coaches. The coaching carousel has cost the school more than $15.4 million.

Arizona State and South Carolina each have ended the past two decades of football with finishes in the top 25 only four times.

Both schools have had four different coaches. Arizona State has paid more than $16.6 million to its fired football coaches while South Carolina has paid more than $17.8

Auburn, Florida and Florida State are frequent residents of the top rankings – all own at least one national championship since 2000. But that hasn’t been enough to keep their coaches on the sidelines.

Auburn and Florida State have had four coaching changes since 2000.

Florida has had six.

The price tag has been hefty. Auburn has spent $38.1 million on fired football coaches; Florida: $24.6 million and Florida State: $21.3 million.

“It’s almost like a revolving door, you have some coaches who are collecting, you know, checks from two and three schools, simply because they believe that. . .these coaches were the Messiah,” said Elmore, of the Knight Commission.

Gus Malzahn is an example. After receiving $21 million from Auburn, he now collects $2.3 million a year from Central Florida as its football coach.

At the big-name schools, coaches typically are paid a few hundred thousand dollars as a university employee. The millions of dollars added to their total compensation come from media rights and apparel deals.

Alabama’s Nick Saban signed a contract last month, that pays him this year $305,000 as a university employee and another $9.6 million from those outside sources.

He was the highest paid coach among the public FBS schools until Clemson gave Dabo Swinney a raise in early September, giving him $10.5 million a year, illustrating the arm’s race.

With six national championships on his resume, it’s highly unlikely that Alabama would fire Saban. His buyout clause is worth more than $46.3 million this year.

At least a dozen coaches have buyouts that exceed $25 million this year – outpacing the record amount given to Auburn’s Malzahn - including:

· Texas A&M’s Jimbo Fisher ($86 million)

· LSU’s Brian Kelly ($77.4 million)

· Cincinnati’s Luke Fickell ($35 million)

Since 2004, Central Michigan, Georgia Southern and Tennessee each have seen eight coaching changes, the highest turnover in the FBS.

But the amount they have paid in severance payments to football coaches shows the difference between the Haves – schools in the ACC, Big 10, Big 12, SEC and PAC-10 – and the Have Nots.

Central Michigan, a member of the MAC, has spent $1.3 million on buyouts.

Georgia Southern, which plays in the Sun Belt conference, has only paid out $210,000.

But Tennessee, which plays in the SEC, has written checks totaling $26.6 million.

Change is needed to reform out-of-control spending

Len Elmore, David Ridpath and Kansas professor Alexander all agree that reforms are necessary.

But each has a different take.

The Knight Commission, of which Elmore is a member, sees a benefit in separating the Haves and Have Nots, where the super-rich schools form a new division or alliance to play amongst themselves.

“The idea of super conferences and the realignment that we’re seeing, you know, just further illustrates the need for those big conferences, super conferences, to kind of separate themselves from a football standpoint, so that they can find rules and legislation that applies to them, because of their unique situation,” Elmore said. “This is not the first time that the NCAA could go through a transformation in that regard.”

It happened before in the 1970s when the NCAA split athletics into three divisions. “Many of the reasons why that split occurred is to align institutions with the similar interests, align them together and allow them to legislate in ways that fit their needs,” he said.

Ridpath agrees. Ohio University is never going to be on the same equal financial footing as Ohio State.

But he believes it’s time for Congress to step in and mandate that the football coach may be paid only $1 more than the highest paid university employee.

But in a place like Ohio State, that means a coach still could be a multimillionaire because some doctors on the staff make millions, themselves., he said.

For example, if the highest paid Ohio State employee makes $3 million, then coach Ryan day would be paid $3,000,001.

Professor Alexander believes that athletic departments should be pushing their donors to also provide to the academic side when they are writing their checks for sports.

But as the debate continues, the buyout clauses in football coaches’ contracts continue to grow.

Numerous coaches have been offered extensions over the past two years that have ballooned severance clauses.

Tom Allen at Indiana would receive $14.5 million if he were fired on or before Nov. 30 then $7.7 million after that date.

Bret Bielema at Illinois would receive $10.1 million and Dana Holgorsen at Houston would get $$18.8 million.

“Wow. . . you would hope that those buyouts would maybe dissuade somebody from firing a coach to be like, well, you don’t want to pay this buyout, but it doesn’t seem to hinder that at all,” Ridpath said. “It’s pretty crazy stuff.”

Kansas, perhaps, learned that lesson. Coach Lance Leipold won only a single game last season. But earlier this month, his contract was extended until 2027.

And back at Auburn, fans are getting antsy. Malzahn’s replacement, Bryan Harsin, only won six games last season. Should he be sidelined this year, Auburn will owe him $14.3 million.

It’s big bucks for big buyouts in search of gridiron glory.

Research and data collection contributors are InvestigateTV associate producers Conner Hendricks, Payton Romans and Jalen Wade, and students from the Arnolt Center for Investigative Journalism at Indiana University. They are: Carly Demas, Noah Harrison, Mary Claire Molloy, Logan Skirm, Mia Stewart, Kayan Tara, Mitchell Tiedman, Rachel Van Voorhis, Lucy West and Lauren Winnefeld.