Posted: May 02, 2011

Sports biz: Will coach for food

Stewart Schley

There are lots of reasons to root for the University of Colorado Buffaloes this coming football season. Home-state loyalty. An exciting new conference. That big freaking buffalo that makes every other mascot in the nation look like a simpering suit of fluff.

But I'm down with the Buffs for another reason. I like CU's style when it comes to paying the top dog.

That would be Jon Embree, the amped-up head coach whose team speeches, according to early lore, are infused with more shouting than any aging booster ever heard from Robert Plant at full roar back in the day. Some enterprising Leeds School of Business student in Boulder ought to start marketing a brand of throat lozenges named Embrees.

The contract approved in March by CU's Board of Regents guarantees Embree $250,000 in salary this year. He'll make more by showing up for media appearances and shilling for sponsors, but the base guarantee is just that: $250,000.

If you're pulling $70k with commissions and trying to pay for a house and a family, it sounds like a pretty sweet gig, I realize. But in the grander scheme of NCAA Division 1 Footballnomics, Embree is working on the cheap.

According to data supplied by CU to the U.S. Department of Education, CU's football program generated roughly $26 million in revenue for the 2009-2010 season, the latest for which data are available. Thus, Embree's base salary translates to about 1 percent of total team revenue.

And how does that compare with Embree's fellow coaches in the Pac-12?

Let's start at the top by taking a look at the coach everybody loves to hate, the University of Southern California's Lane Kiffin. USC, a private school, isn't subject to the Dept. of Education's reporting requirements, and hasn't disclosed Kiffin's compensation. But most published reports estimate Kiffin gets $4 million-plus per year.

The Dept. of Education's Equity in Athletics website indicates USC's football program generates $29 million in annual revenue. At $4 million, Kiffin would be pocketing 14 percent of the revenue his team generates. Assuming the contributions of an able tax accountant, Kiffin's net take-home pay for a month would approach what Embree will collect in salary over a year, before taxes.
Then there's the University of Oregon. Chip Kelly, the coach whose dazzling offensive attack brought Oregon to the Rose Bowl in January, will earn $2.4 million in base salary as part of a five-year, $20.5 million deal inked in September. Kelly's guaranteed compensation equals nearly 10 percent of the Ducks' $29 million in annual football revenue.

Other Pac-12 schools are generous with their coaches, too. The University of Washington's Steve Sarkisian earns $1.8 million a year, or 5.5 percent of the $33 million the Huskies generate from football. The $2.3 million guaranteed to Cal's Jeff Tedford is nearly 10 percent of the Bears' $24 million in football revenue.

At the bottom of the Pac-12 list is the former CU tight end Embree. His salary is low, and his name barely recognized among coaching prospects, because CU's athletic department is in a cash bind thanks to previous revenue shortfalls and costly payouts to former coaches.

So it's not as if Embree is falling on some sword of conscience here. Instead, weird circumstances have made CU, unintentionally, a model for sane economics in big-time college sports.
If a true market economy prevailed, no coach would be guaranteed such a lofty share of gross revenue from his employer. (Colorado's highest-paid executive, Liberty Media CEO Greg Maffei, has a guaranteed salary of $1.5 million from a company whose annual revenues top $6 billion. Even with record stock bonuses in 2009, Maffei's compensation equaled less than 2 percent of Liberty's revenue.) But college football is an artificial economy. The mainstay labor force of student-athletes works for free. That leaves a far bigger share of cash available for head coaches. In contrast, the National Football League funnels close to half of its revenue back to players.

It's apparent that the entire college sports system is wired for financial abuse. But now and then, you get a crack in the absurdity. That's what we have this year at CU. A coach who's working for a relatively meager paycheck, yelling like madman, trying his heart out. To which we can only respond: Go Buffs!
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Stewart Schley writes about sports, media and technology from Denver. Read this and Schley’s past columns on the Web at cobizmag.com and email him at stewart@stewartschley.com

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Readers Respond

You need to ask the Buffs 4 Life member how much he and his crowd ever contributed to the Buff Club? You will find out that very little contributions were ever made. At $250K he is overpaid for an unqualified coach By Jack Sharp on 2011 05 23

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