At this point, we’re numb to it.

Seeing that Auburn paid Bryan Harsin a cool $15.58 million to go away wasn’t met with thought-provoking analysis on the current state of amateur athletics. Instead, it was “well, that was inevitable” or “well, at least it wasn’t the $21.5 million buyout like Gus Malzahn got.”

Harsin was 1 of 6 Power 5 head coaches who got fired during this 2022 cycle. Ultimately, those schools agreed to pay $65.98 million in head coach buyouts, which was an average of roughly $11 million per Power 5 buyout (via The Knight Commission). That’s standard now. In fact, that number was actually slightly down from the average Power 5 head coach buyout in 2021, which was $11,587,000.

But that wasn’t a sign that the buyout bubble is bursting or even deflating. The slight year-over-year decrease per Power 5 school can be attributed to the prestige of programs that paid those buyouts in 2021 vs. 2022.

  • 2021 Buyout Programs
    • Florida
    • Miami
    • USC
    • Washington
    • Virginia Tech
    • LSU
    • Texas Tech
    • TCU
  • 2022 Buyout Programs
    • Colorado
    • Auburn
    • Wisconsin
    • Arizona State
    • Georgia Tech
    • Nebraska

Those schools paid more than $150 million in buyouts for Power 5 head coaches not to work over the past season and a half.

Mind you, there were 33 FBS coaches who entered the 2020 season with a buyout of at least $10 million if they had been fired. Of those 14 Power 5 buyouts that were agreed to be paid in 2021-22, 9 of them hit that $10 million mark. From 2012-21, FBS teams agreed to pay more than $530 million in staff buyouts, and the annual number has tripled since the Playoff started (those figures don’t even include buyouts paid from private universities).

The numbers are staggering, and the way the sport is currently set up, there’s not much incentive to change that. If anything, new billion-dollar media contracts will only add to the ballooning coach buyout trends. Even if the pay-for-play era nets players a cut of that through some sort of Collective Bargaining Agreement (CBA), it’s unrealistic to think we’re going back to the days of 7-figure buyouts for all fired coaches.

So what can be done? Anything?

“It’ll take some outside force before schools voluntarily do something,” Knight Commission Member Jonathan Mariner told SDS.

The Knight Commission believes there’s at least a way to add some incentive for athletic directors to not spend so liberally. After all, coach buyouts aren’t coming out of tuition fees or some sort of state tax. As long as athletic directors have rich boosters to turn to, there’s almost always a way to justify a buyout for an underperforming coach. Alternatively, there’s always a way to justify ridiculous raises.

“You don’t see a lot of professional coaches with 8-10-year contracts, nor do you see coaches who after 2 years of success, get extended another 8 years,” Mariner said.

Professional sports operate under an entirely different financial model, which Mariner saw up close during his 12.5 years as the executive vice president and Chief Financial Officer of Major League Baseball. Teams have a certain budget, and as Mariner put it, it’s like peanut butter. You can spread it however you want, but that’s what you get to spread. Want to overspend on contracts? You’re gonna pay the luxury tax.

Could there be a luxury tax down the road in college athletics? And if so, what would that even look like?

In 2021, The Knight Commission proposed a conference-based system to enforce spending on coach buyouts. That would include taking the median compensation level for each conference. Spend more than double that in a given year? Get your TV revenue payout reduced by 50%. As Mariner outlined, that money would instead be shared among the other member institutions who instead spent their money on things like player safety, gender equity, diversity, etc.

That’d be significant considering the SEC just agreed to a $3 billion TV deal that’ll begin in 2024. Average annual payouts are projected to be north of $100 million per SEC school by the end of the decade.

“So an athletic director actually has reason to say, ‘I’d love to pay you more, but that’s gonna reduce my TV money,’” Mariner said.

If the luxury tax model were to be enforced by each conference, it wouldn’t violate anti-trust laws. In theory, it makes a lot of sense because it isn’t necessarily capping earnings. It’s just putting rules in place to reallocate those funds. Just like pro sports with teams that are willing to take the luxury tax hit in pursuit of winning a title, we could still see college programs that are willing to agree to massive buyouts for elite coaches. They’ll just have their media revenue reduced.

“If you’re a rich school,” Mariner said, “you can say, ‘I don’t really care. I want the next Nick Saban. I’ll take less TV money because I’ll make it up some other place.’”

The foundational issue is that just like what we saw during the 2020 COVID season, Power 5 conferences act out of their own interests. If the Pac-12 agreed to the luxury tax model to incentivize rational coach buyout figures, there’s nothing stating the SEC has to follow suit. All the Pac-12 coaches could flock to the SEC, where buyouts continue to balloon.

This would take a unified response from the Power 5 conferences, not so much the NCAA. But the current buyout figures, as bloated as they are, still haven’t prompted any outside force to take action.

“I’m not sure what it would take to trigger a change,” Mariner said. “We’ve made a proposal. We’ve spoken to a number of conferences about the conceptual idea of having a distribution formula that recognizes or tries to create some downward pressure on coaches’ compensation … it sometimes takes years before the NCAA adopts them. Usually, after some external event that requires a change. I don’t know what that change might be that might do it. I’d like to think that schools would do it voluntarily.

“The challenge is the NCAA is hamstrung as it’s currently constructed and really forcing change across the entire collegiate landscape.”

Just like with NIL, it appears that Congress stepping in is the only real way to enforce imminent change, at least as long as college football operates under the NCAA’s enforcement umbrella. There still hasn’t been that landmark case with a coach buyout.

Maybe it’ll take a buyout like Jimbo Fisher’s being paid. Fisher would’ve been owed $85,950,000 by A&M if he had been fired at the end of the 2022 season, which was roughly 15 months after he received a 10-year extension worth a fully guaranteed $95 million. If A&M wants to fire Fisher and pay him less than a $50 million buyout, it would have to wait until after 2026. Fisher would be owed $48,750,000.

As recently as 2017, the total combined money that FBS programs agreed to pay fired coaching staffs was $48,322,114 (note that doesn’t include money spent by private universities to fire coaches). Shoot, in the fiscal year of 2014, which was the first season of the Playoff era, that number was $21,775,028. In the past 3 coaching cycles, we’ve seen 6 different instances of Power 5 programs agreeing to pay buyouts of at least $15 million, including 2 from Auburn.

Will the 2021 trend of 10-year contracts prompt change to rethink buyouts? Probably not unless we see someone get fired just a few years into one of those contracts.

The day a coach is paid $50 million not to work will be well past when outside forces should’ve intervened.