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College Coaches Have Foothold On Millions

Thu., Dec. 26, 1996, midnight

One of the first coaches to take money to sell sneakers, Georgetown coach John Thompson’s rise to multimillionaire status epitomizes the wealth garnered by top coaches and contrasts so starkly with the restrictions on their players.

Thompson, a member of Nike’s board of directors since 1991, helped kick off the whole era of commercialization in college sports.

Today he owns options on 36,000 shares of Nike stock, currently valued at more than $2 million, and makes about $1 million a year between his school salary, $350,000 Nike consulting fee, summer camps, endorsements and speaking engagements.

Thompson, who declined to discuss his income or holdings, already has exercised options on 22,000 Nike shares and banked $1.18 million in profits in the past two years, according to financial records obtained by The Associated Press.

Duke’s Mike Kryzewski, Kentucky’s Rick Pitino and North Carolina’s Dean Smith also are in the million-dollar coaches club, joined by football brethren Steve Spurrier of Florida and Bobby Bowden of Florida State.

Virtually all the top 25 basketball and football coaches are making six-figure incomes, many of them supplementing their school salaries with camps, endorsements, board memberships and TV and radio shows.

The weekly TV shows that many coaches have bring in anywhere from $25,000 to $250,000 a year, depending on the size of the market, according to agents. Summer camp revenue can run from $40,000 to $100,000.

“It’s not unusual for these guys, the durable top coaches who consistently do well, to make well over $1 million a year,” said sports economist Roger Noll of Stanford. “The coaching business is an extraordinarily high-risk business. A brand new coach at a traditional basketball power might have a relatively low salary until he proves himself, but then it goes through the roof as soon as he shows that he’s good.”

Winning football coaches who get their teams on television consistently can be worth the money they’re paid, Noll said.

“Every time they’re on TV, depending on whether it’s regional or national, the school’s going to get somewhere between $200,000 and $700,000,” he said. “If they do that 10 times a year, that’s a tremendous amount of money. That’s where the big money is in football.”

Successful football and basketball programs not only bring in big money from television and sponsors, but usually also attract fatter donations from alumni that can mean millions more to a university.

The money top coaches make usually far exceeds the salaries of professors, and often school presidents, which leads to some tension between faculty.

“A lot of my colleagues at the university are hostile to the athletic department,” said Washington State sports economist Rodney Fort. “The athletic department tries to cast itself as a teacher of life skills and all that stuff, and parts of the intellectual community just laugh at that.

“But I love to point out to those guys, when they start getting on their high horse about coaches’ TV contracts, that they’re just jealous because the best outside income opportunity they can generate is some consulting money for a pharmaceutical company, and it just doesn’t pay as much. That’s the only difference.”

The era when top college coaches labored for prestige and little money started coming to a close in 1978 when Nike representative Sonny Vaccaro signed up UNLV’s Jerry Tarkanian for $2,500 and all the sneakers his Runnin’ Rebels needed.

Vaccaro had connections to Tarkanian and many other coaches through the high school all-star game he had been running each summer in Pittsburgh since the 1960s. Vaccaro’s access to the players made him valuable to the coaches. When Vaccaro joined Nike, his access to the shoe company’s money and products made him even more valuable to the coaches - and vice versa.

“My theory was then, and it is now, that the person that controls the university is the basketball coach,” said Vaccaro, fired by Nike in 1990 after 13 years and now working for rival Adidas. “The team will wear what he wants them to wear, so you pay him and you give free shoes to the school and it’s a win-win situation.”

The NCAA harrumphed, college officials averted their eyes, but no one could find anything illegal with what Vaccaro was doing, so he went right on signing up dozens of coaches and doling out shoes. In 1982, Vaccaro upped the ante.

“At that time, Georgetown was the No. 1 hot college team in America, and Patrick Ewing and John Thompson were the hottest commodities,” Vaccaro said. “John came to me one day and said Patrick wants to wear a T-shirt underneath his uniform, legitimately, because he was always cold down at McDonough Gym where they used to play.

“John said, ‘Why don’t we put a Nike swoosh on the sleeve.’ So we did, very innocently. I made up some T-shirts with swooshes on them. Then they were on television, and the NCAA came up with a ruling. They thought the whole college game was going to blow up. So they stopped that immediately.

“The same people who stopped it then now allow the colleges to sell everything and have the kids going around like walking billboards. That’s how far we’ve come. I’ve watched the whole evolution. A rule was made, then all of a sudden, there are no rules. Coaches made millions of dollars. Then when the coaches started making the money, the schools said, ‘We’re going to control the money, we’ll make a deal, and we’ll take care of all funds and you’ll give us money.’ And that’s where you are today.”

Vaccaro is angry with the way the college scene has turned out, with coaches, athletic directors, schools and the NCAA all making big money and relatively little going to the players.

“Since I invented the problem by paying the coaches for the first time nearly 20 years ago, I’m also involved deep enough to say that the whole system is wrong and the people who run everything are wrong,” Vaccaro bellowed in his raspy voice.

“I’m saying do away with all of it. I’m saying, even though my livelihood and my persona emanate from the shoe industry, it’s so wrong that I would get out of it entirely. I would eliminate summer camps, all-star games. There’s only one trouble. Nike would own everything.”

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