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April 21, 2004

Court Rules Full Disclosure For Coaches’ Pay Packages

FROM THE FAR SIDE OF THE ZIG-ZAGGING LINE SEPARATING THE PUBLIC’S RIGHT TO KNOW FROM THE PRIVACY OF COACHES’ CONTRACT TERMS comes what may prove to be an epochal judgment from the Maryland Court of Appeals.

The suit was filed by the Baltimore Sun after it tried for two years to get details of University of Maryland compensation packages, only to be rebuffed repeatedly by university officials.

The most immediate effect of the ruling is that UM has been ordered to release contract details of basketball coach Gary Williams and football coach Ralph Friedgen. The court’s ruling requires details of compensation packages to be made public, with an itemization of state salaries, bonuses, incentives and endorsements.

For many—particularly critics of huge compensation packages of top college coaches—the issue is fundamentally straightforward: since the public is “the boss,” then the public has the right to know the contract terms of all public employees.

There has historically been no resistance to disclosure of the state-funded salary portion of coaches’ compensations (which are typically a small portion of total packages for football and basketball coaches).

However, it is the more substantial third party payments that state universities have refused to divulge details. The bulk of this third party funding comes from sports apparel and footwear companies, plus donations from alumni association.

In a related ruling, the court decreed that if endorsement income is “intimately connected” to coaching activities, then that income is also subject to disclosure.

As a practical matter, it appears that almost all endorsement deals will be deemed to be “intimately connected” with coaching activities. Murray Sperber, an Indiana University professor and a noted critic of big-time college sports, said, "The only reason the coaches are getting this money is because they are coaches at the school. Sporting goods companies are not paying these guys millions so they can take pictures of them at home with their wives. What they're paying them for is that every time they appear with the team, that [the players] are wearing the right shoes."

In anticipation of the court’s ruling, both Maryland coaches voluntarily disclosed their compensation arrangements. In 2001-02, Coach Friedgen’s salary was $173,753. His total package—which included performance bonuses, a car allowance, radio and TV income, and endorsements with manufacturers—was $762,000. Coach Williams’ salary was $202,991 and his total package was $743,391.

Meanwhile, the University of Maryland’s president was paid $358,000 in 2002-03. And full professors averaged $106,000. In the University System of Maryland, 43 people made more than $250,000 in 2002, according to the payroll department in the comptroller's office.

Gov. Robert L. Ehrlich Jr. is paid a $140,000 salary.

In total, Williams can earn up to $1.87 million each year with bonuses and incentives, while Friedgen can earn up to $1.47 million.

As generous as these compensation arrangements are, they come nowhere close to the highest paid football and basketball coaches throughout the country.

For example, LSU’s Nick Saban is good for a guaranteed $2.3 million this year after winning the national championship. Oklahoma's Bob Stoops and Florida State's Bowden also make more than $2 million annually.

In basketball, Kentucky's Tubby Smith has an eight-year, $20 million contract, and Louisville's Rick Pitino has a six-year, $12.4 million deal.

Andrew Zimbalist, Smith College professor and a critic of big-time college athletics finances, commented on the escalating packages that are part of the overall arms race: "It's unjustified economically and inappropriate educationally and morally for [the coaches] to receive the kind of salaries they do."

Ahem.

It’s only money.

(this 584 word excerpt—with attendant commentary—was distilled from a 1273 word article in the Baltimore Sun of 4-16-04, a 1413 word article in the Baltimore Sun of 4-28-04, and a 497 word article in The Chronicle of Higher education of 4-19-04)