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Message
Chizik's $7.5M buyout
Posted on 11/13/12 at 3:05 pm
Posted on 11/13/12 at 3:05 pm
I just had two Auburn alums in my office. They both were trying to convince me that Auburn will pay to get Chizik out of there. I told them that 7.5M plus 3M for a new coach the following year is a lot of money for a team that isn't in the top earners club with Alabama, Georgia, LSU & Florida. They went on to question why Auburn would allow the football team to fail one more year and lose all of the money from ticket sales, bowl money, etc.
It got me thinking about how much the University (state money) would go towards the buy out? I assume nothing over what the state allows a university to pay a coach and then the boosters pick up the rest of the tab.
I guess what I'm asking is if you're a deep-pockets-having Auburn booster, do you throw some money in the pot for the buyout this year or next year when that number is a lot less? I think you only do that IF you can get a big name like Petrino, Del Rio, Jimbo, Gruden, etc. Otherwise, what's the rush if you only get a Mark Hudspeth or Art Bryles?
It got me thinking about how much the University (state money) would go towards the buy out? I assume nothing over what the state allows a university to pay a coach and then the boosters pick up the rest of the tab.
I guess what I'm asking is if you're a deep-pockets-having Auburn booster, do you throw some money in the pot for the buyout this year or next year when that number is a lot less? I think you only do that IF you can get a big name like Petrino, Del Rio, Jimbo, Gruden, etc. Otherwise, what's the rush if you only get a Mark Hudspeth or Art Bryles?
This post was edited on 11/13/12 at 3:07 pm
7
Posted on 11/13/12 at 3:07 pm to FatDrunknStupid
Do a quick google search on his buyout. It's not a $7.5 mill cash payout. I serously doubt Auburn ends up paying all of it.
Posted on 11/13/12 at 3:07 pm to FatDrunknStupid
quote:
It got me thinking about how much the University (state money) would go towards the buy out?
0
quote:
do you throw some money in the pot for the buyout this year or next year when that number is a lot less?
AU is a 100 million dollar program. 5-10 million is not a lot of money when you consider the program, as a whole.
Posted on 11/13/12 at 3:10 pm to FatDrunknStupid
quote:
I just had two Auburn alums in my office. They both were trying to convince me that Auburn will pay to get Chizik out of there. I told them that 7.5M plus 3M for a new coach the following year is a lot of money for a team that has isn't in the top earners club with Alabama, Georgia, LSU & Florida.
Auburn has over 100 Million annually in revenue (good for top 10)... so the money is there, we are above UGA and very close to LSU.
USATODAY Database
Also your numbers are wrong, if we keep Chizik then we have to pay him 3.5 million next year, so paying a coach 3 million is actually a savings of $500,000... So that leaves 2 million a year to chizik. (2.5 for three years).. Considering the loss of revenue (empty stadiums, tshirts, concessions, etc.), we can not afford to keep Chizik;
ETA: at least your user name is accurate...
This post was edited on 11/13/12 at 3:11 pm
Posted on 11/13/12 at 3:11 pm to AUCE05
I understand that, but Auburn doesn't have a baseball team like LSU or Georgia that finances itself. 90-100 million split up amongst all the athletic programs makes 7-10 million a lot to eat.
Posted on 11/13/12 at 3:12 pm to FatDrunknStupid
Posted on 11/13/12 at 3:13 pm to allin2010
quote:
Also your numbers are wrong, if we keep Chizik then we have to pay him 3.5 million next year, so paying a coach 3 million is actually a savings of $500,000...
It was a rough estimate. In my opinion, to make a "big splash" with a big name, I guarantee you that Auburn would have to pay at least 3.5-4M.
Posted on 11/13/12 at 3:13 pm to FatDrunknStupid
quote:
understand that, but Auburn doesn't have a baseball team like LSU or Georgia that finances itself. 90-100 million split up amongst all the athletic programs makes 7-10 million a lot to eat.
The loss of 10,000 season tickets @ $500 each is 5 million per year... that is 15 million over three years... Baseball has nothing to do with it... Auburn makes a profit, has money in reserve to pay the buyout ($18,000,000 or so)...
Posted on 11/13/12 at 3:14 pm to FatDrunknStupid
It depends on how fast the outgoing coaches find jobs. Their buyouts are reduced by their new income. It's paid on a monthly basis also.
Posted on 11/13/12 at 3:14 pm to FatDrunknStupid
I guess I should have noted that I wasn't taking a jab at Auburn's bank account. We all do well, with the exception of Vandy and maybe Kentucky. Don't take the figures too seriously. I'm ball parking things here.
Posted on 11/13/12 at 3:15 pm to FatDrunknStupid
quote:
, I guarantee you that Auburn would have to pay at least 3.5-4M.
Won't be a problem
Posted on 11/13/12 at 3:17 pm to FatDrunknStupid
Ole Miss paid Nutt 5 million last year, UT will pay Dooley 5 million this year... that is the going rate.. yes we are overpaying by 2.5 million, but that would not prevent us from doing it...
It is more big time booster who will stop contributing vs. giving money for the buyout.
It is more big time booster who will stop contributing vs. giving money for the buyout.
Posted on 11/13/12 at 3:17 pm to AUCE05
quote:youre dreaming if you think $10M isnt a big deal-- just some loose change for any school. thats a massive hit to TEXAS and they have the highest revenue athletic dept and huge money boosters. that $100M they make every year-- i'd bet 99% is already been budgeted for and everyone is fighting over the last $1M. auburn may be able to pull it off, but to act as if $10M is nothing is a fantasy
AU is a 100 million dollar program. 5-10 million is not a lot of money when you consider the program, as a whole
Posted on 11/13/12 at 3:19 pm to LSUTIGER in TEXAS
quote:
youre dreaming if you think $10M isnt a big deal-- just some loose change for any school. thats a massive hit to TEXAS and they have the highest revenue athletic dept and huge money boosters. that $100M they make every year-- i'd bet 99% is already been budgeted for and everyone is fighting over the last $1M. auburn may be able to pull it off, but to act as if $10M is nothing is a fantasy
Learn how buyouts work, then come back with a argument that's worth a shite.
Posted on 11/13/12 at 3:22 pm to allin2010
quote:
The loss of 10,000 season tickets @ $500 each is 5 million per year... that is 15 million over three years... Baseball has nothing to do with it... Auburn makes a profit, has money in reserve to pay the buyout ($18,000,000 or so)...
Baseball was a bad example to use, I apologize. It's a sport that universally covers its own finances throughout the SEC from year to year. I think it should be kept in mind that football has to cover the expenses for sports that have no way in hell of covering their own expenses (Volleyball, Track, Swimming, Girl's Basketball,etc).
I saw a forbes list earlier this year listing the budgets of a few schools and what they keep at the end of the day after paying for all the sports that run in the red. After all the numbers are crunched, 7-10 which, like an above poster made mention of, would decrease depending on whether or not Chizik finds a job, still would be a lot of money to eat THIS year.
Posted on 11/13/12 at 3:27 pm to FatDrunknStupid
Sure, that would be a huge hit this year, but fortunately for Auburn it doesn't have to be. It's paid in monthly installments over the length of his contract. Chizik's full buyout wouldn't be paid until Dec. 2015. That amount would only have to be paid in full if he couldn't find a job anywhere else. Same goes for the assistants.
LINK
LINK
This post was edited on 11/13/12 at 3:29 pm
Posted on 11/13/12 at 3:32 pm to FatDrunknStupid
quote:
job, still would be a lot of money to eat THIS year.
It's 200k a month over the rest of his contract, not 7.5 mil at once, and any employment comes out of that. 2.5 mil is not all that much to come up with, more so with booster support. Even easier, when he finds employment and that drops more
Posted on 11/13/12 at 3:33 pm to Smoke7024
Well, if that's the case then pull the trigger. I didn't know the full details of the buyout. The only thing I question is the timing, now. I'm sure a few people have already been approached. If it truly is 4-7.5 mil paid out over 3 years, then I guess nows the time to strike. I just hope for Auburn that they get a big name and not some flash in the pan.
Posted on 11/13/12 at 3:39 pm to FatDrunknStupid
I don't know what Auburn's financial landscape looks like but $7-10 mill seems to be a very doable number for any program in the SEC, other than Vandy and Kentucky (not that they can't afford it but football isn't their main focus to start with).
As other posters have pointed out, buy oust, as a general rule, are paid out over an extended period. It's good for the school as they can budget for it over several years and it's good for the ex-coach as he doesn't take the tax hit all at one time.
As other posters have pointed out, buy oust, as a general rule, are paid out over an extended period. It's good for the school as they can budget for it over several years and it's good for the ex-coach as he doesn't take the tax hit all at one time.
Posted on 11/13/12 at 3:42 pm to Smoke7024
quote:
Do a quick google search on his buyout. It's not a $7.5 mill cash payout. I serously doubt Auburn ends up paying all of it.
The players will probably agree to a salary cut to help - after all $hitty coaching will damage (hell, has damaged) the draft stock of many of them. Probably a push if the take a cut now for the right coach.
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