Big bucks, big buyouts

Former Indiana basketball coach Archie Miller’s time at the university was, overall, nothing special — finishing his career at IU with a 33-44 record in Big Ten play.

What was most memorable about Miller’s IU career, it turns out, was how much it cost to fire him.

The university spent $10.35 million, paid for completely by anonymous donors, to buy out and replace Miller, accounting for the largest buyout in Big Ten basketball since at least 2004. Miller’s buyout figure, along with other coaches’ individual payments, reflects the amount to be paid out to a coach by the university at the time of termination.

It turns out underperforming coaches are big business in the Big Ten, as its 14 member schools have spent at least $148.7 million in severance payments on football and men’s basketball coaches and staff since fall 2004, according to an analysis of NCAA financial reports by the Arnolt Center for Investigative Journalism and InvestigateTV.

What the Big Ten has spent to fire coaches pales in comparison to the $1.1 billion Division I Football Subdivision Schools spent on coaches’ severance for all sports at the school. Of that amount, $624 million bought out football and men’s basketball coaches, according to InvestigateTV’s analysis of the Knight-Newhouse College Athletics database at Syracuse University.

“It’s obvious that institutions are throwing money away that could be used to enhance the education, health, safety and well-being of student-athletes on mistakes that have been made on hiring,” said Len Elmore, a member of the Knight Commission on Intercollegiate Athletics, during an interview with InvestigateTV. “At least from the standpoint that absolute winning has to be paramount.”

Big Ten Spending

Big Ten men’s basketball and football programs spend millions to bolster their programs and become as competitive as possible.

“University administrations love having sports,” said Rodney Fort, professor emeritus of sport management at the University of Michigan. “People love college sports and are willing to shell out a bunch of money to watch it.”

Big spending, however, doesn’t always equal better performance.

The University of Nebraska has spent $31.2 million in coaching severance payments, the most in the Big Ten since 2004, including the years before the Huskers joined the conference in 2011. They have never been a Big Ten champion in either football or men’s basketball and have hired five football coaches since 2004, according to InvestigateTV.

Rutgers University, sitting at second most for severance spending, has not seen a Big Ten title in either men’s sport since joining the Big Ten in 2014. The university also has the lowest win-loss percentage in conference play going 12-58 historically for college football.

These figures do not reflect any donations given to universities to offset the costs of buyouts. Additionally, this data does not include spending for Northwestern, as InvestigateTV and the Arnolt Center were unable to access the university’s NCAA financial reports going back to 2004.

Well-known coaches have come and go, with millions changing hands.

Football head coach Bo Pelini led the University of Nebraska to at least nine wins a season but never a Big Ten title, over the course of seven years, according to ESPN. In 2014, Athletic Director Shawn Eichorst fired Pelini after having renewed his contract for another five years when the previous season ended, a decision which cost the Huskers $7.65 million.

Rutgers University fired its head football coach, Chris Ash, in 2019. He held the position for two years, finishing with an 8-32 record overall and a 3-26 record in the Big Ten. Originally contracted for five years, Ash’s contract was extended for another two years only months before he was bought out of his contract — for $8.47 million, according to NJ.com.

A winning record at one university might be a good enough reason for a school to continue paying that coach, Fort said, but at another university, that record may mean nothing if the school doesn’t make the playoffs or win a championship.

“Some programs, even performing well isn’t good enough,” Fort said. “If revenues are failing, relative to what the AD (athletic director) considers to be the best the program can do, that’s when coaches come under scrutiny.”

In other cases where, even though both the coach and university agree to end a contract mutually, the school still pays out. Thad Matta, a well-known Ohio State basketball coach, stepped down from his position for health reasons in 2017.

Still, the university paid for his buyout and guaranteed him just over $9 million in severance.

Archie Miller falls out of favor at IU

Miller was a big recruit for the Hoosiers, coming off a successful run with the Dayton Flyers that netted NCAA tournament seeds during four of his six years there, according to IU’s athletics page. However, after four seasons as the head coach and a 12-15 losing record at the end of the 2021-22 season, students and fans were ready for a fresh start.

Unlike other financial investments and decisions, sports performance can be extremely difficult to predict, Fort said. It’s never certain how coaches will perform each season, let alone what external circumstances might present themselves.

The Arnolt Center sent a public records request to IU for all emails sent to and or from IU Athletic Director Scott Dolson and former IU President Michael McRobbie concerning Miller’s buyout between Feb. 1, 2021, and April 30, 2021. The request turned up four emails.

Emails obtained showed discontent among alumni and donors with the dismal record after the end of the 2020-2021 season.

Multiple people threatened to pull donations from the university, including IU alumnus Mark Dempsey.

“Don’t you care that Indiana University is now a laughing stock when it comes to men’s basketball? Do the right thing. Fire Miller today,” Dempsey wrote in an email to the university sent in early March 2021. “I use(d) to assistant coach Bloomington HS North, hire me, I sure couldn’t do any worse then Miller and I won’t cost as much.”

University administrations use sports to advertise to potential university donors, Fort said, so it’s important for teams to perform well. Schools want donors to become nostalgic for their time spent at the university on campus, he said, which usually involves going to sports games.

“You want to walk them through campus on the way during a crisp, wonderful fall day to the football stadium,” Fort said. "Because everybody remembers that part of their university experience and cherishes it."

Of course, a poor record can also affect athletic revenues and how much money the program brings in, Fort said. So, both pieces of the buyout puzzle are essential to understanding that process, he said.

Nick Autry, another alumnus, also expressed frustration about Miller’s IU career in an email to Dolson on February 14, 2021.

“It’s embarrassing that Purdue kicks IU’s butt every game and that we are lucky to be invited to the NIT, not the NCAA Tournament,” Autry wrote in an email.

Responding to Autry mid-February, Dolson highlighted the high standards he and the program both hold regarding IU basketball, the level of success the IU program expected and his commitment to making sure these standards and expectations were met.

Weeks later, on March 15, Miller was fired.

“Indiana Basketball has a long, rich history of success that dates back generations,” Dolson said in a release after the announcement. “I have high expectations for our program, and we have not competed at a level within the conference or nationally that I believe we should."

Dolson declined an interview for this story.

Miller’s big buyout draws criticism

The size of Miller’s buyout raised complaints from some donors, and the anonymity factor only added fuel to the fire.

In an email to McRobbie, alumnus and donor Jim Caughlin called Archie Miller’s buyout “disgusting” and announced plans to partially pull his donations to the university.

“Just the fact that somebody can afford this, to buy him out like that — and, a step or two prior to that— is why these guys get paid so damn much money in the first place,” Caughlin said during a phone interview with the Arnolt Center. “It’s kind of obscene.”

Elmore said one reason for high buyout prices is that schools choose big-name coaches. They believe a high-profile coach will turn the program around, he said.

“It’s almost like a revolving door,” Elmore said. “You have some coaches who are collecting checks from two or three schools simply because they believe that these coaches were the Messiah with regard to football, not recognizing there’s a deeper pool of talent that may not have the notoriety of others but certainly may have the skill.”

Beyond that reason is the simple fact that fans and athletic directors have high, even unreal, expectations of coaches. People want more, Elmore said, and a decent performance may be overshadowed by a lack of championship titles or loss to an in-state rival.

Miller, who went 0-7 against in-state rival Purdue University, isn’t the first coach at IU who’s been bought out of his contract by anonymous donors. In 2008, head basketball coach Kelvin Sampson left with a $750,000 buyout, $550,000 of which was paid by anonymous donors, according to the New York Times.

Sampson was succeeded by interim coach Dan Dakich, who held the role for one season, and Tom Crean, who coached for nine seasons before being bought out of his contract for $4 million in March 2017, leaving the role open for Miller.

Caughlin, the IU donor, said he understands academics and athletics are funded differently but doesn’t understand the disparity in pay between the two.

“I would rather hear them say, ‘Well, IU had this many (more) Nobel laureates than winning football teams,’” Caughlin said. “But that’s just me.”

To Caughlin, academics are the school’s purpose, and when the highest-paid employees work for athletics, it means IU’s priorities need to change.

Other alumni and students questioned the anonymity factor behind the buyout. The Arnolt Center sent a public records request for the donor agreement between IU Athletics and the IU Foundation. The university denied that request citing Indiana code regarding nondisclosure of a donor’s identity.

Fort said often what happens behind the scenes with coaching decisions is not made public knowledge.

“A lot of times, we don’t actually know why coaches are fired,” Fort said. “We don’t always get to see that answer.”

Buyouts propel ‘coaching carousels’ at Big Ten universities

In March, the University of Rhode Island hired Miller as its head basketball coach. That made Miller the highest-paid state employee in Rhode Island, according to NBC and Sports Illustrated.

Miller will make $1.4 million his first two years, and $1.9 million his next three, plus incentives. Because of the terms of the buyout, Indiana will save what Miller earns these next two seasons — $2.8 million.

Second-year head coach Mike Woodson, Miller’s replacement at IU, will make around $3 million annually — $550,000 in base salary and $2.45 million in outside marketing and promotion, plus benefits and supplemental compensation, according to his contract.

If IU fires Woodson before April 1, 2025, it will owe him 100% of the base salary and external payment — $3 million per year — which he would have earned through March 2027, the final year of his contract. If he’s let go after that date, this goes down to 50%.

If a coach is hurting the program, the university will buy them out, and if they’re helping it, another school is likely to buy out the coach to give them a better opportunity — and even more money, Fort said.

That “coaching carousel” will continue unless the programs themselves become inherently more competitive, he said.

“Why it will always be there is the underlying reason that it’s there,” Fort said. “To promote coaches, or at that important point, to weed them out.”

This story was written by students from the Arnolt Center for Investigative Journalism in partnership with InvestigateTV. The students also hold positions at the Indiana Daily Student.

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