That’s right, he’ll mortgage future income to pay Rob Mullens and the coaches now. Why not? They’ll all be gone when the bill comes due – just as Dave Frohnmayer is.
Meanwhile the faculty is on its own. Jon Wilner has the scoop in the San Jose Mercury, here:
The Pac-12 is planning a mammoth loan program that would provide an escape hatch for cash-strapped athletic departments in the event the football season is canceled because of coronavirus, according to internal documents and conference sources.
Football accounts for the majority of each department’s revenue, generating in excess of $50 million dollars in ticket sales and media rights alone.
The loan program would be large enough to cover that loss for each school, if needed:
According to a series of emails obtained by the Hotline through public records requests, the loan would provide a maximum of $83 million for each university at a rate of 3.75 percent over 10 years.
… Schill, who succeeded DiStefano as chair of the conference’s CEO Group on July 1, responded:
“I didn’t either. I did know that Larry was going to investigate putting together a loan. I guess he went with Raine. I hope the terms reflect work and not a finder’s fee that is outside the norm.”
(Through a spokesperson, Schill declined to comment, and Scott was not available.) …
“Surely the mandatory student fees for the athletic department will be refunded if the football season is cancelled,” he said into the meaningless, uncaring void.
The article says the conference has the collateral to borrow money to lend to the conference members, but I didn’t read what collateral the unis will need to give for their loans. My understanding is that advertisers are asking for their broadcast rights money to be returned. If so, then why would the Pac12 assume that any new rights contract would pay anywhere as much as those of previous years? If so, then whoever lends the conference the money to lend to the unis would look to something far more tangible to backstop their investment. Wouldn’t that be federally guaranteed student loans?
Regardless, the Pac12 has now gone into the payday loan business…
We could put Hayward Field up as collateral.
My gawd, what would happen if BlackRock ended up owning The Phildo? I’ll leave it at that….
Real me: busting a gut laughing.
Responsible me: “Sorry, Charlie, Cards Against Humanity jokes have been cancelled.”
Is there some reason this is not possible when it comes to the academic side? Use our autonomy to borrow against future revenues to avoid calamitous program and pay cuts now? Borrow using Romania or other land the UO owns as collateral? How much would Treetops fetch? The Stag building?
Good luck with that approach. Moody’s Analytics recently downgraded UO bond rating to negative. Yet another example of ineffective leadership by the Board of Trustees and the administration.
Up vote….
I guess only the profitable departments will get bailed out. Capitalism guides the way yet again.
Don’t think this has anything to do with UO in terms of the Loan, it is the PAC 12 which undoubtedly has a higher credit rating than UO.