By Abigail Funk
Men’s basketball coaches’ salaries have been steadily increasing over the years and as schools are choosing to offer multi-year contracts with huge bonuses, they’re also including buyout clauses to deter new coaches from leaving before completing their contract (while making it tougher for other schools to lure coaches away). For example, last month, when restructuring Head Coach Reggie Theus’s contract and making him the highest paid coach in the Western Athletic Conference, New Mexico State University also included a buyout clause worth twice his salary if Theus leaves the program in the next two years.
Meanwhile, at Auburn University, the seven-year contract Head Basketball Coach Jeff Lebo signed in 2005 stipulates that Auburn will receive $25,000 for each year left on Lebo’s contract (with a maximum of four years) if he decides to accept another position. If Michigan State University Head Coach Tom Izzo decides to leave East Lansing for the professional ranks before April 30, 2010, he’ll owe the school $1 million (he owes nothing if he leaves for another college program).
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In April, John Beilein stepped down as Head Basketball Coach at West Virginia University with five years remaining on his contract to take the same position at the University of Michigan. In order to get out of his contract, Beilein’s pact with West Virginia called for him to pay the school $500,000 for each year left on his contract, putting his buyout bill at $2.5 million. After discussions with West Virginia, it was agreed that he would pay $1.5 million in installments to West Virginia over the next five years instead.
In Beilein’s case, the University of Michigan and Beilein both agreed that the coach was responsible for paying the penalty for resigning early. But other schools have agreed to pick up the tab for a coach they were heavily recruiting to their program. The University of Colorado agreed to pay the Air Force Academy its entitled buyout when Colorado hired away Head Basketball Coach Jeff Bzdelik from the Falcons in April. Colorado now owes Air Force $270,000 while the academy is left looking for a new coach and questioning coaches’ loyalty to their program.
“Loyalty will be very important,” Air Force Athletic Director Hans Meuh told USA Today, describing what he’ll look for in future coaches. “But, I’m also smart enough to know—and I’m getting smarter every day—that in this business, it is what it is. I’m afraid that the only way these days that an institution can protect itself from having other schools lure away their coaches is to put in a $1 million buyout clause, and I think I’m going to do that in the next few contracts.”
The other side of the coin for institutions is that if the coach isn’t the one who wants to leave and it’s the school that wants him gone, the school is on the hook for the remaining salary. Before hiring Theus, New Mexico State fired former Head Coach Ritchie McKay with three years left on his contract. McKay will collect $580,000 from New Mexico State as a result of having his contract terminated prematurely.
“The good news for us was that it wasn’t a lump sum,” New Mexico Athletic Director Paul Krebs told ESPN.com. “There are quarterly payments for essentially a $190,000 a year impact to our budget. We’ve worked it into our budget. It’s a concern and as we negotiate future contracts, we will have a greater sensitivity of any buyouts that might be in there.”
Abigail Funk is an Assistant Editor at Athletic Management. She can be reached at: afunk@MomentumMedia.com.
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