You have to pay to play in March
Smaller schools strain budgets to challenge the bigger boys
RICHMOND, Va. — Shaka Smart, the charismatic men’s basketball coach of Virginia Commonwealth University, made news last week when he told the University of Illinois thanks, but no thanks — the same as he told North Carolina State a year ago.
That upset the natural order of college sports. The grass isn’t always greener at major-conference schools, but the contracts almost always are. And Smart, 34, turned down more money to stay each time.
He was the hottest commodity in coaching a year ago when he piloted VCU’S astonishing run to the Final Four. To keep him, VCU upped his guaranteed money from about $420,000 last season to about $1.2 million this season, a raise funded largely by an increase in student fees.
This season, his Rams reached the NCAA tournament’s round of 32, missing the Sweet 16 by an eyelash — and this time Smart got “a slight increase in compensation,” plus more money in his recruiting and travel budgets, according to athletics director Norwood Teague.
VCU digging deep to thwart the get-smart bids by Illinois and N.C. State is emblematic of a widening dollar gap between major-conference schools and so-called midmajors. Football TV contracts and attendance for the six power conferences of football’s Bowl Championship Series mean big money, while competitive ambitions at midmajors often
outrun their athletic departments’ ability to pay for them.
“It’s a huge issue,” said NCAA President Mark Emmert, who calls rapidly rising coaching salaries “a challenge for the lower-resource schools.” Athletic departments at such schools largely are subsidized by university funds and/or student fees. Big money for coaches there can translate to students paying higher bills and schools facing more stress on stretched academic budgets.
Some schools such as VCU ante up so coaches don’t leave for wealthier programs. Others, such as budget-strapped Nevada-las Vegas, simply get outbid by them. And then there are the Cincinnatis of the world: lower-revenue programs in power conferences depending on institutional funds to help them keep coaches.
Indeed, college basketball’s marquee event is loaded with millionaires. Coaches in the NCAA tournament are making a little more than $1.4 million on average this season, according to USA TODAY’S annual analysis of contracts and other compensation documents. Among the 68 tournament coaches, USA TODAY was able to obtain pay figures for 62 — from Kentucky coach John Calipari, who is making nearly $5.4 million, to Mississippi Valley State coach Sean Woods, who is making $87,500.
The newspaper obtained 2010 and 2011 compensation information for 31 of the 34 schools appearing in the tournament both this season and last and found the average compensation for coaches at those schools increased to a little over $2.1 million from more than $1.9 million — a jump of 8.6%.
The changes in compensation range from a drop of 61% at UNLV, which lost its coach to another school and hired a less expensive successor, to a 224% raise at Marquette, which paid its coach a one-time bonus of nearly $2 million. That puts the median raise at 12%.
Among public schools, the biggest raises went to Calipari, who also led Kentucky to the Final Four last year and received a contract restructuring that resulted in a $1.3 million increase; Purdue’s Matt Painter, who got an increase of more than $1 million after spurning an offer from Missouri; and Smart, whose income increased by $786,000 after he elected to stay at VCU.
Virginia Commonwealth President Michael Rao said his decision to up the ante to keep Smart a year ago was simple, and he figures Smart’s richer contract is paying off as much in marketing VCU’S name on a national scale as it is in helping the Rams remain competitive on the court.
“This was a cultural opportunity to move to a different place” in public perception, Rao said. “People look — whether you like it or not — through an athletic lens, so you have to accept that as an important part of how America views and evaluates universities.”
If Smart had left, Rao said, “I don’t think I ever would have heard the end of it. Everything people believe about the VCU basketball program, they need to start believing about VCU in general.”
In an interview about three weeks ago, Rao said he thought his school was among the nation’s top public research universities and that basketball allowed him to tell that story to a broader audience. Pressed on which schools he sees as VCU’S public research peers, Rao named one: Illinois — which, at the time, was days away from firing Bruce Weber and making a run at Smart.
Rising student fees at VCU
Public schools in Virginia cannot use funds they receive from tuition or the state for their athletic departments’ costs. They generally raise athletic funds from ticket sales, booster donations, student fees and — in the case of major-conference schools Virginia and Virginia Tech — various media rights and corporate sponsorship deals. According to VCU’S 2011-12 university budget plan, $732,900 for pay increases for Smart and his staff came from “changes in university fee-supported activities.”
The mandatory university fee at VCU was $1,587 in 2010-11, of which $559, or 35%, went to athletics. That fee rose to $1,637 in 2011-12, of which $610, or 37%, goes to athletics, according to figures provided by Pamela Disalvo Lepley, executive director of university relations.
The fee is paid by all full-time students in the undergraduate, graduate and professional schools and are prorated for part-time students. VCU has 25,647 full-time equivalent students, and they get free admission to athletic events; 1,800 to 2,000 men’s basketball tickets are reserved for them, and some students were turned away just three times this season, Lepley said.
The university fee also supports such things as facilities, student commons and activities, student health services, recreational sports and parking and transportation. Some of those areas had hikes that contributed to the fee increase of about $50 from the year before; $31 of the increase went for athletics. But students’ bills do not disclose how much of the fee goes to athletics.
“I talked to a lot of students about this, and the consensus is they’re OK with it,” said Asif Bhavnagri, president of VCU’S Student Government Association. Smart is “a great coach who gives us national recognition, and we’re willing to pay a little more to keep him.”
Said Teague: “The student fee at VCU is ranked in the bottom third in the state of Virginia. Within the student fee is the athletic fee, and the percentage of our athletic fee is in the lower half as well. We’re not gouging our students.”
But VCU funnels money toward the athletic department in other ways. According to a document VCU filed with the NCAA in January, the department got $15.6 million of its $19.9 million in revenue from student fees in 2010-11. The document said the department had $21.4 million in expenses, a shortfall of about $1.5 million.
Pam Currey, VCU’S associate vice president for finance and administration, said about $610,000 of the gap was filled by money for renovation and repair projects from the department’s reserve fund. The department also got proceeds from non-athletic events at VCU’S arena and more than $600,000 for arena debt service from soft drink royalties brought in through a VCU business unit that includes dining services, retail and parking. All together, that means the athletic department received closer to $16.5 million that it did not generate.
‘Can we afford to do this?’
At the same time VCU was keeping Smart a year ago, UNLV was losing Lon Kruger.
“We have a lot of budget issues in the state of Nevada,” UNLV athletics director Jim Livengood said. “I think there’s a point in time, in terms of salary and length of contract, where we have to say, ‘Can we afford to do this?’ ”
Kruger was making $1.14 million a season at UNLV and got roughly $2 million a season to leave for Oklahoma.
“It was not, ‘Good luck, nice knowing you.’ We absolutely tried to keep him,” Livengood said. “But it just wasn’t something fiscally we could do.”
UNLV cut about $1.7 million from its athletic budget this school year to make up for cuts in state and university funding. Livengood knew cuts were coming, but not how deep they’d be, when he tried to keep Kruger.
UNLV hired alumnus Dave Rice as coach at $450,000 a season, a big savings over Kruger’s contract, though Livengood said that was not a factor in the search. Rice’s Runnin’ Rebels went 26-9 and made the NCAA tournament, losing in the round of 64; a year earlier, Kruger’s Rebs went 24-9 and also made the NCAA tournament, losing in the round of 64.
Even some of the power conferences’ less-prosperous schools are feeling the weight of athletics.
Cincinnati, of the Big East, reports on its NCAA financial documents that its program receives no student fees.
But the university’s support of athletics has risen from $10.7 million in 2007-08 to $14.7 million in 2010-11. Even with that subsidy, the program reported an annual deficit of nearly $1 million that increased its cumulative operating deficit to $33.9 million.
After the 2010-11 basketball season, in which the Bearcats made the NCAA tournament for the first time in coach Mick Cronin’s five seasons at the school, he received a new six-year contract that included a $250,000 pay increase to $1.25 million and guaranteed annual raises of $100,000.
This season, he led the team to its first NCAA round-of-16 appearance since 2001.
Smart’s rise
The idea of VCU paying its basketball coach nearly the same amount as a successful Big East coach would have been unthinkable 10 years ago.
But Rao has heard no complaints from presidents of other schools in the Colonial Athletic Association.
“There is probably some underground discussion,” he said, “but it hasn’t made it to me. Not until this article, anyway.”
What are some factors that sway Smart toward remaining at the school?
“I love coaching at VCU,” he said. “It’s a school that presented me with an unbelievable opportunity a few years ago when I was an assistant coach nobody had ever heard of. And that’s something I really value. Most importantly, I love the players on our team.”
Smart was an unknown assistant at Florida when Teague hired him three years ago. Last season’s Final Four run changed everything. “Our athletic department will never be the same,” Teague said. “Our expectations are different now.”
Emmert said he doesn’t know how far midmajors can keep stretching: “If you think about it, they have always gotten by with lesser resources, by definition. . . . The escalation of expenditures hits some natural ceiling, but I don’t know where that is.”