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Wednesday, April 12, 2006

$2M Questions: Where Does Cash Come From?

$2M question: Where does cash come from?

Robbi Pickeral, Staff Writer
News & Observer
Raleigh, North Carolina

So how do you find enough money to offer someone $2 million to coach college basketball? If N.C. State goes that high for a new men's basketball coach, it would have to put together a complicated deal that would include funds from the athletics department -- which gets its revenue from sources, including ticket sales, TV contracts and the ACC -- plus radio/television money, shoe contract dollars and fundraising from the booster club.Executive Director Bobby Purcell said the N.C. State Student Aid Association -- commonly known as the Wolfpack Club -- a nonprofit booster organization that provides scholarships for student-athletes -- is prepared to help fund a package for a new men's basketball coach. It currently funds $840,000 in annuities for football coach Chuck Amato.

North Carolina's Educational Foundation, commonly known as the Rams Club, raised money for a $3.9 million "replacement package" for coach Roy Williams, so he would not lose money when he was hired away from Kansas in 2003. The Wolfpack Club might have to take a similar approach.

"We have funds in place, but we would try to do something special for that," said Purcell, adding that the university would need to propose a figure to the Club's 20-member board for approval.
Like at Carolina, Purcell said, the funds -- in whatever form -- would be paid to the University, not directly to the coach.

It's unclear what the ripple effect of such a high salary might be in the ACC. Williams' package is worth an average of $1.6 million a season; according to tax returns, Duke coach Mike Krzyzewski was paid just less than $1.5 million in 2003.

"I can assure you that all successful coaches want and expect raises regardless of whether there has been a recent search in the region -- and they all know the 'market' value of their work," East Carolina athletics director Terry Holland said in an e-mail. "Some university positions are driven by national market forces, others by regional market forces and still others by local market forces -- it is pretty certain that coaching positions in the so-called 'revenue' sports are driven by national market forces.

"I believe the concerns about the 'arms' race, including rising coaches' salaries, are legitimate concerns, but antitrust legislation to protect a free market economy prevents institutions from being able to address the issue by collusion."

Here's a breakdown of what coaches make -- and where it comes from -- locally:

ROY WILLIAMS, UNC BASKETBALL
Total package per season: roughly $1.6 million
Base salary: $260,000
Bonuses: 1/12 salary each for making NCAA Tournament, round of eight, and when team graduation rate equals that of the student body
Expense account: $25,000
TV/radio: $347,300 from Learfield
Extras: $3.9 million over five seasons, raised by Rams Club; separate $500,000 deal with Nike

JOHN BUNTING, UNC FOOTBALL
Total package per season: roughly $650,000
Base salary: $260,000
Bonuses: 1/12 salary for participating in postseason play
Expense account: $25,000
TV/radio: roughly $225,000 from Learfield
Extras: separate $150,000 deal with Nike

SKIP HOLTZ, ECU FOOTBALL
Total package per season: at least $400,000
Base salary: $150,000
Bonuses: $25,000 for making NCAA bowl, $25,000 for making BCS bowl or league championship bowl
Expense account: reimbursement for expenses "reasonably incurred"
TV/radio: $240,000 (with $25,000 increases each season)
Extras: $10,000 from Pirate Club appearances; also earns money from summer camps and is allowed apparel and endorsement deals

RICKY STOKES, ECU BASKETBALL
Total package per season: at least $200,000
Base salary: $150,000
Bonuses: $15,000 for NIT bid, $25,000 raise the following season for NCAA bid
Expense account: reimbursement for expenses "reasonably incurred"
TV/radio: $40,000 (with $25,000 increases each season)
Extras: $10,000 from Pirate Club appearances; also earns money from summer camps and is allowed apparel and endorsement deals

HERB SENDEK, FORMER NCSU BASKETBALL
Total package per season: roughly $800,000
Base salary: $175,000
Extras: information not immediately available

CHUCK AMATO, NCSU FOOTBALL
Total package per season: roughly $900,000
Base salary: $206,601
Bonuses: Three months' pay for making bowl
Extras: Also eligible for $840,000 in annuities, funded by the Wolfpack Club, to be paid by the University on Jan. 6, 2008; other information not immediately available

MIKE KRZYZEWSKI, DUKE BASKETBALL
Total package per season: According to Duke's 2003 tax return, Krzyzewski made $1,488,888 -- $800,000 in compensations, $71,860 in contributions to employee benefit plans and deferred compensation, and $617,028 in an expense account and other allowances. Duke is a private school and there is no public information on compensation.

TED ROOF, DUKE FOOTBALL
Unavailable.

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