An Arizona donor has devised a creative way to attempt to keep the stars of the school's athletic department in Tucson for a long time. The donor, who has yet to be identified, has offered football coach Rich Rodriguez, basketball coach Sean Miller and athletic director Greg Byrne a small stake in an oil and gas company -- and a potentially huge lump-sum payment -- if they stay at the school for the next eight years.
According to documents released Wednesday by the state's board of regents in conjunction with proposed contract extensions for all three men, the donor has offered 500,000 units of a master limited partnership currently valued at $35.36 per unit ($17,680,000 total) to the University of Arizona Foundation. If Rodriguez remains at the school eight years from the effective date of the contract, he would receive 175,000 units or the cash value (currently $6,188,000) of those units. Miller would receive the same deal. Byrne, meanwhile, would receive 100,000 units (currently $3,536,000). If the value of the company rises, the value of the shares would rise. If the value of the company falls, so would the potential windfall for Rodriguez, Miller and Byrne. The Board of Regents will vote June 6 to approve these contracts as well as a contract extension for Arizona State football coach Todd Graham. The Arizona Republic's Doug Haller and Anne Ryman first reported the Arizona contracts.
Neither Rodriguez, Miller nor Byrne are allowed to comment publicly on the contract extensions before they receive board approval. The new five-year deal for Rodriguez would average $2.2 million a year. Rodriguez also has an incentive package that includes $175,000 for a "non-major, non-final four bowl game," $200,000 for appearing in a "major, non-final four bowl game" or $300,000 for winning such a game. Rodriguez also would receive $200,000 for a Pac-12 South Division title or $300,000 for a Pac-12 title. If Arizona wins the national title, Rodriguez would receive a $1 million bonus. Rodriguez, who has some experience with buyouts, owes Arizona $1 million if he leaves prior to Jan. 15, 2015 or $500,000 if he leaves between Jan. 16, 2015 and Jan. 15, 2016. Those buyout figures double if Rodriguez leaves for West Virginia.
Miller's base salary will remain at $1.5 million but would jump to $1.6 million on June 1, 2018. He has a bonus structure that pays up to $800,000 if the Wildcats win the NCAA tournament. Miller also can receive a bonus based on his team's cumulative grade point average. The sliding scale starts at $50,000 for a 2.6 and rises to $200,000 for a 3.0 or better.
Byrne's base salary will rise from $500,000 to an average of $675,000 a year for five years. Byrne can receive up to eight weeks in base pay based on the graduation success rate and cumulative grade point averages of Arizona's athletes. Byrne has no bonuses in this contract related to individual athletic achievement. Ohio State athletic director Gene Smith was criticized earlier this year because a national title won by an Ohio State wrestler triggered an $18,000 bonus clause for Smith.
Depending on the performance of the donor's company, Rodriguez, Miller and Byrne could have a serious financial incentive to remain at Arizona. The Wildcats didn't have the cash to pay as much as some of their conference rivals -- the Republic reported Graham's new compensation package at Arizona State will total $2.7 million a year -- but the ownership stake plan could make the Wildcats coaches and AD richer in the long run than some of their Pac-12 counterparts. It also offers them a measure of security. If Arizona fires Rodriguez, Miller or Byrne before the eight-year mark, they would receive a pro-rated portion of the shares. That could result in a heavy golden parachute if the value of the stock rises. The plan also offers the school a bit of security. If any of the trio leaves voluntarily for another job before the eight-year mark, that man's shares would remain property of the University of Arizona Foundation.
It will be interesting to see whether other schools follow suit. If Mark Helfrich wins the Pac-12 at Oregon this year, would he be offered a small stake of Nike in lieu of more up-front cash? If Josh Pastner leads Memphis to the Final Four, could he command a piece of FedEx to stay? Pastner probably wouldn't get a crack at his alma mater, because Miller has 175,000 reasons to stay that could grow more valuable with each passing year.