Cougars embrace windfall from new conference TV contract
PULLMAN – Sometimes the biggest news can get buried.
When the decision was announced late last October how the Pac-12 would slot the universities of Utah and Colorado for football, lost among the jetsam released by the conference was a golden nugget.
At least for Washington State.
As part of the deal that put the two new schools in a South Division with TV darlings USC and UCLA, the conference would migrate away from its former appearance-based media-revenue sharing model and divide all the money equally among the partners.
For Washington State athletic director Bill Moos, this was a fulfillment of a quest.
“If I’m here five years, 10 years, 15, I don’t think there will be anything I could do or have more of an impact than working to get the equal shares with the revenue,” Moos said. “This very easily could have been a $3 billion deal with USC and UCLA seeing $20 million and Washington State $10 (million a year).”
It’s a sea change that Moos and his colleagues outside of Southern California saw as a key component for the new Pac-12.
“It was something I recommended and put forth as something that I thought was very important to the future success of the league,” said Pac-10 commissioner Larry Scott, who, in less than two years, has already overseen more change in the conference than any time in its history. “When you look at the other successful conferences, and you look at pro sports, there’s a measure of equal revenue sharing and a sense it’s all for one, one for all.
“All members of a league have to have a certain level of health for the league to be successful. For me, it was … having a culture that would position us for success.”
If rising tides raise all boats, the new revenue model is WSU’s Bay of Fundy.
Over the past five years, Washington State’s average television payout from the Pac-10 was $3.82 million, part of a budget that never reached more than $31.5 million.
In the middle of that time period, 2007-08, USC generated more than $8 million in TV revenue and had a budget of almost $77 million.
Though the budget disparity may not change, the media revenue will.
Both schools should receive somewhere in the neighborhood of $15 million in 2012-13, the first year of the 12-year contract. From there, the payouts from the $3 billion agreement will escalate each year, finishing somewhere around $25 million.
The impact of an extra $12 million or so in Pullman – some 38 percent of WSU’s most recent budget – far outweighs the $7 million bump (less than 10 percent) the Trojans will receive and will help address the problems the revenue gap has helped create.
“It’s been the difference between us being competitive or not,” Moos said. “I say that because we’ve not been able to address salaries, recruiting budgets, facilities, in which we are drastically behind, and it’s created a morale problem, making it difficult to catch up.”
That’s something Scott felt was crucial as the Pac-10 morphs into the Pac-12.
“It’s something that is important for our conference to reach its full potential,” he said. “Each of the members needs to be healthy and needs to be at a certain level in terms of their facilities (and) their resources. That ensures healthy competition.
“If we want an image nationally of being among the most preeminent conferences, maybe even the best, I think people measure that top to bottom, not just top.”
The importance of the new revenue model was underscored last week when ESPN released its schedule of Pac-12 games for the fall, the last under the old contract.
Of the 20 games the network announced it will televise, none include Washington State. Under the new revenue-sharing agreement, that doesn’t matter.
“It allows us to get healthy in all of our programs,” Moos said of the revenue bump WSU will see over the next decade, “to address additional positions in academic support, sports medicine and others. Hopefully, it will help us address salaries, to get closer to the Pac-12 average.
“Most importantly, it enables us to go forward in a big way in facilities. That will, in turn, create other revenue streams.”
With all this good news, Moos still sees a dark cloud.
Asked if he’s worried Cougars boosters might see the Midas-like touch as a reason to zip up their wallets in these tough times, he answered “absolutely.”
“We’ve got to guard against that,” he said. “Our intent is to build this program on solid footings, be in a position to compete and have a stable foundation.”
With that in mind, he’s touring the Northwest, speaking with groups of boosters and spreading his goal. It’s the same one former athletic director Jim Sterk had but was never able to realize.
“We, more than ever now, need our fan base to step to the plate,” Moos said, pointing out giving is about $4 million short of WSU’s estimated $6.8 million – and rising – annual financial-aid costs.
“What the message is going to be is we need to crack that nut because it’s a fixed cost that is going to increase each year.”
So what will the athletic department do with the media-rights money?
Atop Moos’ list of needed projects, and a drum he’s been beating for nearly a year, is a remodeled Martin Stadium. The project, which will include luxury boxes, premium seating, a new press box and a football-only building behind the west end zone, is in the design phase.
The last hurdle before ground can be broken is approval from WSU’s regents, something Moos expects in late September.
“They were updated last week while I was in Phoenix,” he said. “The reports are they were quite impressed.”
But with the new media money as collateral, Moos doesn’t expect to stop with the stadium.
Also on his to-do list is a 21st-century upgrade of Beasley Coliseum – a new center-hung scoreboard is already in the works for next season – along with an upgrade to the soccer field – lights and new turf – and an old chestnut, a true indoor practice facility, replacing the bubble south of the baseball field.
“I am toying with a baseball clubhouse as a piece of the indoor facility,” Moos said.
Moos has gone so far as digging up the old designs and model former athletic director Rick Dickson toted around in the 1990s. It just so happens, Moos said, that the Martin Stadium design firm also worked on the indoor facility plans – abandoned due to budget restraints – back then.
But no matter what, budget restraints will always be with Washington State. It’s something Moos recognizes, but doesn’t dwell on.
“These are exciting times,” he said, “and yet, the comment I made (to the athletic staff), if indeed the number is $20 million a year once things level out, and we were the only school to get the $20 million, our budget would still be in 12th place.”
Still, there is a gold lining.
Moos believes, after the changes in revenue sharing and the new media contract, WSU is the big winner.
“It enables us to be optimistic about our future,” Moos said.