It’s Time to Fix Warped Incentives in Division I College Sports

Check out who would win the men's NCAA tournament  based on academic performance. Click to enlarge.

Check out who would win the men’s NCAA tournament based on academic performance. Click to enlarge.

This op-ed by Arne Duncan and Tom McMillen is cross-posted from USA Today.

March Madness is underway, but the 2011 champion, the University of Connecticut, is conspicuously absent. The Huskies men’s team isn’t competing this year because it failed to meet the minimal academic requirements set by the NCAA for postseason play.

The fate of UConn’s team sent shock waves through locker rooms, coaches offices and the suites of athletics directors and university presidents. For the first time, a powerhouse program lost its opportunity for postseason glory because of years of poor performance in the classroom. We think this is a good start toward restoring a healthier balance between academics and athletics in Division I college sports — and toward reaffirming that the mission of a university is to educate all of its students. But it is just a start.

The NCAA should be commended for raising the academic benchmarks that teams must meet for postseason play. New NCAA regulations essentially require teams to be on track to graduate half of their players to be eligible for postseason play, and graduation and academic progress rates are up significantly for tournament teams this year. Yet governing boards of universities and college presidents also need to do more to reinforce the educational mission of their institutions. Too often, presidents and trustees undermine that mission by providing lucrative incentives to coaches that downplay the importance of athletes getting a college education.

Tom (McMillen) recently examined around 50 contracts for head coaches of college football and basketball, many of them culled from the USA TODAY Sports coaches’ salary database. Most of what he found will surprise no one: Salaries and rewards for big-time college coaches are astronomically high. In 2011, 32 NCAA Football Bowl Subdivision coaches and 11 NCAA Division I men’s basketball coaches earned more than $2 million annually. The highest paid basketball coach that year, Rick Pitino, was paid $7.5 million by the University of Louisville — a little more than $20,500 a day.

Coaches today earn whatever the market pays. But many coaches work at public universities, funded with taxpayer dollars. In 2011, in Oklahoma, Connecticut and Maryland, a head football or basketball coach was not only the highest-paid employee at the university but the highest-paid state employee.

Oklahoma Gov. Mary Fallin earned $147,000 in 2011, while the football coach at the University of Oklahoma, Bob Stoops, was paid $4.875 million, 33 times as much as Gov. Fallin. Moreover, nine Oklahoma football assistant coaches were paid more than the governor, including the tight ends/tackles coach, who pulled down a $240,000 salary.

Coaches receive huge financial bonuses when their team is winning. Yet the incentives for academic success in the contracts Tom examined show how warped priorities have become at some institutions.

If academic performance determined the winners of the NCAA women's tournament, Princeton would come out on top. Click to enlarge.

If academic performance determined the winners of the NCAA women’s tournament, Princeton would come out on top. Click to enlarge.

About two-thirds of the basketball contracts and three-fourths of the football contracts did include a bonus for academic performance. But these incentives were dwarfed by bonuses for performance on the field or court. Academic incentives averaged $52,000 per coach, while athletic incentives averaged $600,000 per coach — a lopsided ratio of 11-to-1.

When many states are reducing funding for higher education, it is hard to justify such skewed priorities and runaway athletic spending. Even at Division I institutions, few athletic programs are self-supporting — which means that institutional funds must typically be diverted to pay for athletic programs.

A recent study by the Delta Cost Project compared spending per athlete and student at Division I institutions. In the six “power conferences” that form the Bowl Championship Series, median athletic spending per athlete topped $100,000 in 2010, compared to about $15,600 spending per student.

Escalating coaches’ salaries are the single largest contributing factor to the unsustainable growth of athletic expenditures. And we believe that universities and colleges must start rethinking coaches’ compensation, at least in the Division I revenue sports.

If universities and colleges want to readjust a coach’s priorities, they need to change the penalties and incentives they offer coaches.

In almost every one of the contracts Tom reviewed, a coach can receive bonuses for winning games, even if his team fails academically. Poor academic performance means the team or the individual player — not the coach — gets punished.

But no coach should receive financial bonuses when much of his team is flunking out or failing to get a degree.

Many boards are too cozy with athletic departments, allowing athletics directors to negotiate contracts for coaches with little oversight. A recent survey by the Association of Governing Boards of Universities and Colleges found that only about 15% of board members think the salary of their football or basketball coach is excessive. Board members sometimes forget their job is to protect the institution — not the coaches, not the boosters and not the fans.

We are not suggesting any regulatory scheme for capping or restricting coaches’ compensation. Nor can we specify the balance between athletic and academic spending that, to paraphrase the Goldilocks principle, is just right. What we can say is that this balance is plainly out-of-whack with the educational mission of many Division I universities.

Governing boards and college presidents can take steps to right that imbalance. They could adopt a model of “best practices” that includes greater parity in new contracts for coaches between academic and athletic bonuses and provides penalties for poor academic performance.

Today, coaches can enjoy multimillion-dollar contracts when they jump to another university, even when their former team suffers sanctions for misconduct that happened under the coach’s watch.

We would like to see “clawback” provisions in new contracts that would enable institutions to recoup some salary and bonuses from coaches and ADs for rogue programs, even after coaches leave an institution.

Creating a healthier balance between academics and athletics in our universities is not rocket science. All of these steps are doable.

But it will take courageous leadership and a willingness by college presidents and trustees to buck the status quo.

This we know for sure: The current path of big-time college sports is neither economically sustainable nor morally defensible.

Duncan is U.S. Secretary of Education; McMillen is chairman and CEO of the Timios National Corp. Both played college and professional basketball. McMillen is a member of the University System of Maryland board of regents.

Audio of Press Call (03/21/2013) Audio icon

Duncan Joins Students, NBA and WNBA Players for Hangout

2013 NBA Department of Education Hangout

Secretary Arne Duncan joined WNBA player Maya Moore, NBA player Harrison Barnes, former NBA player Allan Houston, and high school student athletes from across the country for a discussion about how sports have played a role in their education and maturation. (Photo by Otto Kitsinger - courtesy of NBAE via Getty Images)

Prior to Secretary Arne Duncan “schooling” the competition during his third appearance in the NBA Celebrity All Star Game in Houston last Friday, he sat down with former NBA All Star Allan Houston, current Golden State Warrior Harrison Barnes, and the WNBA’s Maya Moore to speak with five high school student-athletes from across the country during the Department of Education’s first Google Hangout. The discussion centered on the importance of education and how sports can play an important role in maturation on and off the court.

During the live Hangout moderated by CNN’s John King, the students quizzed Secretary Duncan—who played college and professional basketball—and the NBA/WNBA players on how they balanced the demands of education and athletics, as well as discussed the importance of being a leader and a role model in the community.

Sequoia High School (Redwood, Calif.) senior point guard Alaina Woo said it best, “It’s really important that you surround yourself with role models who are passionate about basketball but can go beyond the sport and see the importance in having a balance in life.”

Watch the NBA/Department of Education Google + Hangout here:


Click here for an alternate version of the video with an accessible player.

Kelsey Donohue is a senior at Marist College (N.Y.), and an intern in ED’s Office of Communications and Outreach