By B. David Ridpath, Ed.D., Associate Professor and Kahandas Nandola Professor of Sport Management, Ohio University College of Business
I can remember many nuggets of sage advice over the years from parents, friends, and others whose advice I respect. Oftentimes that advice has guided me well, and other times I only wish I would have followed the advice better , especially when it comes to managing and borrowing money, but I digress! As someone who once had lofty goals of advancing in the college sports profession, I reached out to many for advice on how to navigate the treacherous waters of a money driven business ostensibly grounded in education that I once wanted to make my life’s work.
This can be especially acute in the area of booster, donor and alumni management within the larger context of college sports governance. One of my graduate school professors at Ohio University once told me to never accept anything as a gift or monetary donation unless you are willing to accept you now owe them something. I did not really think about the gravity of that advice at the time. I mean weren’t people donating money to college sports programs to financially support a school they love and not to get something in return? Just give the money, walk away and enjoy the games at good old State U. I thought. How naïve I was. Few will give of treasure without something in return and in college sports that means a certain level of influence and control by boosters.
Few things can derail the career of a college athletic administrator or a coach than NCAA violations or getting crossways with a powerful booster, with booster clashes being the worst scenario. Oftentimes it is the powerful booster than seems to be running things in the athletic department and even the university as a whole behind the scenes such as been alleged in cases of Nike’s Phil Knight and the University of Oregon and T. Boone Pickens at Oklahoma State. More repugnant examples include Robert Burton a prominent University of Connecticut athletic booster who felt that he was not included when former (focus on the term former) athletic director Jeff Hathaway did not consult him in the hiring of Paul Pasqualoni as the Huskies’ football coach in 2011. One can look at Hathaway’s coaching change as a disaster after the fact, but should a booster be dictating these types of decisions just because their money is donated? In a scenario that almost looked like a child holding his/her breath until they turned blue, Burton actually demanded the return of a $3 million donation and that his family’s name be removed from the football team’s training complex. As you can imagine, Jeff Hathaway did not survive very long after this confrontation and is now the athletic director at Hofstra. This is example 1A why many university and athletic administrators do not want to confront and challenge donors.
In the case of Knight at Oregon, his influence cannot be understated. In 2000, he withdrew a promised donation of $30 million to the university because it had decided to join the Worker Rights Consortium, which had publically criticized Nike’s labor practices. The university withdrew from the group, and then Knight eventually returned the donation.
Such is life in college sports where generation of revenue and finding the ubiquitous new revenue streams often lead to the big ask of a very rich person or persons to donate millions to keep the athletic machine running smoothly. Without outside private development dollars, foundations, and the boosters that provide for them, college athletics would be a much different place in appearance and structure. While on the surface donating money to an “educational” component like intercollegiate athletics might seem like a noble exercise, and it is for some, many donors want much more than special seats, good parking places, and names in the program for the money they donate.
As my professor said, oftentimes donors to athletic programs feel like they are owed something and with that comes the urge to control things in a given athletic department or institution, even if they do not have the day to day knowledge or experience in the business, many feel by donating large amounts they should have a say so in operations of an athletic department if not a semblance of control. This not to say that there are not many athletic donors are not intrusive and feel that they own a piece of the department or school. Many are satisfied with their names being on buildings, having an endowed scholarship or two and of course a luxury skybox to boot-just to name a few perks that come with being a major donor. Let’s not forget that with these athletic donations for facilities, coaching salaries, recruiting budgets etc. the donors get a fantastic 80% tax write off. Think about it, would a Phil Knight or Boone Pickens, who once donated more than 160 million dollars to the Oklahoma State athletic department, would make these large donations if not for the generous tax benefits?
Papa John Questions Louisville Athletics
The athletic booster issue du jour now includes the University of Louisville and its most notable donor and booster. There are probably few major donors to athletics and higher education that rival John Schnatter or as he is commonly known as “Papa John.” Yes that Papa John-the pizza mogul who has made millions with his better than average pie. Schnatter has given Louisville millions and his pizza brand is ubiquitous in Louisville athletics including the naming of the gleaming Papa John’s Cardinal Stadium. Schnatter, is also a Louisville trustee in addition to once being a member of the athletic board, a position he ironically resigned from a few short weeks ago.
Papa John directly called out the management of the university’s athletic department and made a veiled reference to longtime Louisville athletic director Tom Jurich by calling the athletic department leadership “invisible.” Schnatter also said the athletic department needed to be “fixed” but didn’t elaborate on what he thought needed to be fixed. To be fair to Schnatter, Jurich has operated with somewhat impunity at Louisville for quite some time, but there is no arguing his success. In his almost two decades in Louisville, he has engineered one of the biggest athletic department makeovers in college sports history. New football and basketball facilities along with other sports, hiring big name coaches, winning championships and the crown jewel, being granted membership in the elite Atlantic Coast Conference (ACC). This success has given Jurich an aura of invincibility and an unmistakable vibe that he does not answer to anyone something that did not sit well with the university’s most notable booster.
Even with the successes at Louisville, things have not been perfect of Jurich’s watch. Football has had some struggles and turnover in coaches. The re-hiring of Bobby Petrino, who carries his own baggage, was somewhat controversial. Head men’s basketball coach Rick Pitino has been a source of problems too despite winning a national championship. First it was covering up an affair that later led to extortion allegations and the current biggest issue of all concerning recent NCAA sanctions for recruiting and extra benefits. The most recent NCAA dust-up concerns a former Cardinals men’s basketball staffer player, Andre McGee, who hired strippers for sex parties with players and recruits and plunged Louisville into a long NCAA investigation and a self-imposed NCAA Tournament ban in 2016. Now the NCAA hammer has come down and sanctions include a loss of scholarships, a five-game ban for the Hall of Fame men’s basketball coach Rick Pitino in 2017-18 for a failure to monitor and lack of head coach control and a likely loss of the 2013 NCAA national championship.
Pitino and Jurich were incredulous at the penalties and vowed to appeal the sanctions. Rather than appearing justified in their comments against the often flawed NCAA process, Jurich and Pitino came off as petulant children more irritated that they were caught rather than being contrite. It is has been this type of attitude and presentation that has changed the perceptions of Louisville athletics as a model department into to one that is more secretive and feels it can do no wrong. Jurich is also somewhat aloof, unapproachable and displays a kingly attitude, which may turn off many donors but most seemed to tolerate because the results are there. However, it clearly offended Schnatter and when that happens the university takes notice. The University of Louisville’s interim president, Gregory Postel in response to Schnatter’s critiques decided to improve oversight of its athletics department and Jurich himself. Like many public universities, Louisville is experiencing budget issues and athletics cannot be allowed to continue to operate without better oversight
Postel offered a strong endorsement of Jurich and said he had not come across anything in athletics that needs to be fixed and it just needs to be studied and have oversight, just like every other area of the university. The oversight steps include a proposal related to financial control and oversight of the athletics department, calling it a good business practice. Jurich himself will now be required to attend full trustees meetings. Schnatter when asked about Postel’s actions toward greater oversight, he replied that he was happy.
The Larger Problem of a Financially Self-Sustaining Athletic Department on a University Campus
While it might seem in this case that Schnatter had justifiable and good intentions when bringing up the shortcomings of Louisville athletic oversight, overzealous booster involvement can be too much, intrusive and even in direct contravention of NCAA rules. On the other hand one of the main goals of every athletic department I have been a part of—becoming financially self sustaining-can only be accomplished with major donors like Schnatter but is also be a major reason why departments can often run off the rail in oversight and governance. At Louisville, like many other universities, the school’s athletic department operates under its own budget separate from the university. For example, the current Papa John’s Cardinal Stadium expansion is being paid for by private donations, sponsorships, and ticket sales. The expansion is scheduled to be completed by the start of the 2018 season.
With those private donations come some donors who may want more control or influence than they should. Of course we deal with this in all walks of life whether it is big business or politics. How we manage it is the key. In college sports it is being up front and even contractual in how the booster-university relationship is going to work. Having that up front conversation and agreed upon involvement and influence can go a long way. It is not horrible for a booster to question how things are run as in the Louisville situation, but questioning it and intervening are two different things. We have athletic directors and presidents for a reason. Certainly being part of a Board of Trustees or an Athletic Board is one way to have more involvement but typically those that have much money to give also know how business and hierarchy should operate and also how it should not. Having the relationship defined and how a booster can interact within the context of NCAA rules and institutional policy is important. Once those boundaries are set, most will respect them. However, if those boundaries are not set or an athletic booster is allowed to run amok and exercise undue influence, the athletic department and university could suffer adverse consequences. It appears the crisis is over at Louisville and Schnatter’s questioning was certainly within his purview as a member of the athletic board. It actually appears that Louisville will have more oversight over athletics than before. Still seeing the friction between Schnatter and Jurich is a good lesson for all intercollegiate athletic administrators to have policies and boundaries in place to control boosters with clear outcomes if the desire for influence becomes a desire to control the athletic department and the athletic director.