That’s why they pay him the big bucks?

You may not have heard, but the Pac-12 this week trumpeted its latest day at the pay gate.

It’s not something the conference has done in the past and was clearly designed to trumpet the record total ($509 million).

In fact, the second paragraph — all 95 words — highlights the increases in revenue and campus distributions over the past four financial reporting cycles.

My interest, as noted in this insta-reaction column, is less in the total revenue than the campus payouts. The mission of the conference, after all, is to serve the schools. They are the conference.

Since the Pac-12 issued a look-at-our numbers release, which is certainly within its right, that’s exactly what I did:

The crack Hotline research staff compared the Pac-12’s percentage increase in campus distributions to those of the other Power Five conferences.

Sure, the numbers matter on an absolute level, but they also matter on a relative scale:

If the Pac-12’s annual growth rate in campus distributions is 10 percent and the Big Ten and SEC are only increasing their payouts by two percent, that’s an advantage for the Pac-12, right?

Welp, as Wilner says in his very next paragraph, context matters.  And context doesn’t look so hot.

The Pac-12 said it has increased the cash sent to its schools by 63 percent over a five-year window.

(In raw dollars, the bookends are the $228 million distributed in FY13 and the $371 million distributed in FY17.)

How does that 63 percent increase compare?

Over the same span, the Big 12 has increased its campus payouts by 69 percent.

The Big Ten has increased its payouts by 79 percent.

The SEC has increased its payouts by, um, 99 percent.

What should we make of that?

Don’t dismiss the nuance: Each conference has its own culture and challenges, its own financial structure and reporting processes.

But it sure appears that the Pac-12 has not performed as well as its peers when it comes to the rate of increase of the dollars sent to the schools.

Go back to what he wrote in that first quote block:  “The mission of the conference, after all, is to serve the schools. They are the conference.”  Then consider that Larry Scott made more money than any of his conference commissioner peers in fiscal year 2016.

When it comes to money, the people running our universities aren’t the sharpest tools in the shed.  And some of you wonder where the money to pay student-athletes might come from.

4 Comments

Filed under It's Just Bidness, Pac-12 Football

4 responses to “That’s why they pay him the big bucks?

  1. Cosmic Dawg

    It is an interesting question, but seems like a hard thing to compare unless you wanted to dig into the details more. He doesn’t even offer gross numbers for all conferences, if this year’s member increases are an outlier or this is a trend, etc.
    I may be all wet here, but I would guess there are a whole lot of factors (not the least of which how the schools themselves are performing, how much individual school alumni care about the revenue sports, etc) that affect not only the grosses but rate of growth the conference can achieve.
    Not saying Pac-12 is doing a good job or not, just suggesting it is too hard to tell from the info provided on that article.

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  2. ASEF

    Most university types just want someone else to deal with it. Running a flagship State U research campus is a lot of headaches, a lot of politics, and a lot of revenue streams. College athletics has all this visibility when the lights turn on, but the administration of it is largely ignored on most campuses – until something insanely stupid ends up in the headlines.

    If players could figure out how to convince universities that paying them would make their lives easier, they’d get paid. Just like Larry Scott.

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  3. DawgPhan

    https://www.sbnation.com/college-football/2018/2/2/16964186/sec-revenue-distribution-2017

    509million gross is 36million per team gross, which isnt the same as what is listed in that article so knock off 2million from the per team number.

    34million per team per year puts the pac 12 in a good spot. @ 29million per team per year they were looking at a nearly $110 million dollar gap over a 10 year period with the SEC and Big 10.

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  4. reality check here

    “When it comes to money, the people running our universities aren’t the sharpest tools in the shed.”

    It is tempting to just say truer words were never spoken, Senator. I certainly agree that when it comes to the spending side and financial reporting the universities are terrible. However, some are really good at raising it. That is especially true for those who have proven investment expertise to attract private foundation money that provides a tax advantaged return to the families that set them up.

    There is not a SEC school that comes to mind in that regard, and it would not show up in the P&L anyway.

    As far as comparability from school to school in the financial reporting practices, as far as I can tell there are not even any assumptions presented to be able to draw any conclusions at all. Cash basis on revenue may have some credibility but expenses are another story

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