Des Moines Register
01-03-07
When will the spending stop?
$40M for college coach not likely in Iowa; big salaries face scrutiny
BY RANDY PETERSON AND TOM WITOSKY
REGISTER STAFF WRITERS
Athletic directors at Iowa's two largest universities wondered the same thing
Tuesday: When will the spiraling spending on salaries for college coaches stop?
"I'm not sure we know yet even if it will stop," said Iowa athletic director Gary
Barta, regarding Alabama's reported $40 million offer to Miami Dolphins football
coach Nick Saban.
If Saban announces today that he will accept the Alabama job, he will become
the highest-paid college coach in the United States with at least $4 million per
season. That amount of money would surely fuel national discussion about
escalating coaching salaries, already a hot topic in Iowa after Hawkeye football
coach Kirk Ferentz got a raise last summer to $2.7 million annually.
In addition, such a contract could generate more controversy over whether
college athletic departments should continue to have tax-exempt status and
whether boosters should be permitted to deduct a large percentage of their
annual contributions as a charitable, education expense when those donations
determine seat location at college football and basketball games.
"I can't even begin to estimate what coaches will make in 10 years," Iowa State's
Jamie Pollard said. "I don't even want to try, because what Alabama's offering is
so far out there that we're never going to be in that stratosphere."
Barta and Pollard agreed on something else - that neither would jump into a
salary bidding war.
"We have a great coach, and you want to keep him even if the marketplace goes
up," Barta said of Ferentz. "But we have to pay a salary that we at our institution
can afford.
"If the market value goes up to a point where we can't afford it - we have to stop."
Pollard also chose a hard-line approach.
"I saw a lot of guys in bowl games winning games - and they're paid a lot less
than $4 million a year," he said.
Boise State coach Chris Petersen averages $500,000 a year, according to
published reports. Oklahoma's Bob Stoops reportedly earns $3.5 million per year.
Petersen beat Oklahoma 43-42 in the Fiesta Bowl on Monday night.
Iowa State's new football coach, Gene Chizik, has a contract worth an average of
$1.1 million over six years.
Ferentz and Chizik are the only head coaches in Iowa with guaranteed contracts
exceeding $1 million, yet Alabama could be offering Saban four times that much.
"That's OK that they want to pay that," Pollard said. "They paid the last guy (Mike
Shula) $2 million and didn't get the results they wanted."
Some suggest that the escalating compensation packages could prompt
Congress to do something it's never done - get tough with colleges and
universities over their tax-exempt status.
In recent months, two congressional committees have raised questions about the
NCAA's status as a non-profit corporation. Concerns also were voiced about
allowing 80 percent of the financial contributions made to athletic departments for
the right to purchase premium seats at sports events to be considered charitable
contributions.
Wally Renfro, senior adviser to NCAA President Myles Brand, said salary
escalation for football and men's basketball coaches is no different than
compensation for college executives or top faculty.
"If higher education wants to compete for the best talent, whether it is in athletics
or any other area, it must compete in a very competitive pool," Renfro said. "If the
NFL market is going to pay someone millions, then each school must make the
decision if it wants to or needs to spend the same amount to attract the top
talent."
Renfro also said salary escalation should have no impact on the non-profit status
given to intercollegiate athletic departments.
"The questions raised about escalating salaries for coaches is one of propriety
for higher education and not the legality of the non-profit status for colleges and
universities," Renfro said.
Barta said the marketplace likely will resolve the issue.
"If each institution goes only to a level they can afford - it'll rest at that level,"
Barta said.
Those market forces could hinder universities with smaller athletic budgets.
"Potentially there's a chance of greater separation," Barta surmised, "but I'm not
going to predict where it might end."
Nor is Pollard.
"Let's put our guesses in an envelope, lock them away, and then look back at
them in 10 years," he said.
Here's a glimpse of the future
Where might coaching salaries at Iowa and ISU be in 10 years? If pay rises at
the same level as it did in the past 10, it would look like:
FOOTBALL
IOWA 1997 total/per game 2007 total/per game 2017 total/per game
FOOTBALL Hayden Fry $391,097/$32,591 Kirk Ferentz $2.7
million/$225,000 $5.0 million/$416,666
Men's basketball
Tom Davis $479,255/$14,976
Steve Alford
$925,000/$30,833 $1.37 million/$45,666
IOWA STATE
1997 total/per game 2007 total/per game 2017 total/per game
Dan McCarney
$253,926/$21,160 Gene Chizik $1.1 million/$91,666 $1.94
million/$161,666
Men's basketball
Tim Floyd $750,000/$24,193
* Greg McDermott
$650,000/$21,666 $550,000/$18,333
NOTE: McDermott is in the first year of a contract that is loaded with incentives,
thus bringing down the 2017 projection