Dabonomics: Inside Swinney's new contract and how the past and present affect it
|Tuesday, April 30, 2019, 8:24 AM- -|
CLEMSON – Dan Radakovich and Graham Neff called it The Swinney Effect. It might as well be called Dabonomics.
Clemson and coach Dabo Swinney agreed to a 10-year, $93 million deal on Friday, making it the largest deal in college football history. Swinney, who has won two national championships with the Tigers, is on pace to make the same average salary as Alabama coach Nick Saban. Both are set to average $9.3 million per year throughout their respective deals.
Swinney is set to make $8.25 million in the first two years of the new deal, increasing to $10 million in 2028, the last year of the contract.
"I am grateful and humbled by the incredible commitment Clemson has made to me, my family and our football program," Swinney said in a statement. "For more than a decade, we have given our all to provide this world-class university, and our incredible fans the championship football program they deserve -- to live up to Best is the Standard.
The Board of Trustees Compensation Committee met early Friday morning at the Madren Center and, after a few smaller items of business, got down to the business of approving Swinney’s new contract. Unlike previous meetings where we’ve been allowed to attend, this one showed a big difference when Radakovich, Clemson’s Athletic Director, and Graham Neff, Clemson’s deputy director of athletics, walked to the back of the room and started a powerpoint presentation.
I quickly texted my boss and said, “There’s a powerpoint. The numbers are about to get crazy.”
What followed was a visual presentation for the BOT that would illustrate why Radakovich believed Swinney was worthy of the largest known contract in college football. The presentation was used to illustrate the value Swinney brings to the university – not just football - and why it is important that Swinney be compensated as the top coach in college football.
The presentation was broken down into four parts:
Part 1: Value
Part 2: Affordability
Part 3: Market
Part 4: Contract Details
In Part 1, the presentation showed how Swinney’s success has increased the value of Clemson’s brand. The chart listed four data points – 2005 (when Swinney was just starting out as wide receivers coach), 2010 (Swinney’s second season as head coach), 2015, and 2018.
In 2005, 52,508 season tickets were sold. That number dipped to 47,826 in 2010, but by 2015, season ticket sales were back up to 55,253, and by 2018, the university had sold 61,523 season tickets.
Season ticket revenue rose from $12,010,706 in 2005 to $24,856,087 in 2018, more than doubling in 13 years. Radakovich was also quick to point out that the price of a season ticket rose from $225 in 2005 to $395 in 2018.
When it comes to IPTAY, annual revenue rose from $12,660,093 in 2005 to $35,978,000 in 2018. Clemson’s licensing agreement with Nike grew from $1,356,704 in 2005 to $13,616,788 in 2018, and athletic department revenue more than tripled from $39,100,505 in 2005 to $121,713,929 in 2018.
In terms of applications to the university, 12,463 students applied to Clemson in 2005, compared to the 28,845 that applied in 2018. Of those 2018 applications, 21,430 came from outside the state of South Carolina.
In Parts 2 and 3, Radakovich said the university expects that the revenue IPTAY and the athletic department bring in between now and 2023 will be for a surplus of funds.
According to the slideshow, the athletic department is expecting a $1.74 million surplus in the fiscal year 2019, followed by surpluses of $1.8 million, $1.88 million, $1.3 million and $2.46 million in the years that follow.
When it came down to the numbers for Swinney’s contract, Radakovich used four contracts as a template – Alabama head coach Nick Saban, Texas A&M head coach Jimbo Fisher, Michigan head coach Jim Harbaugh, and former Ohio St. head coach Urban Meyer.
Radakovich pointed out that Saban has won six titles, Meyer has three and Fisher has one. Harbaugh has yet to win a title at either Stanford or Michigan but has a contract that pays him $7.5 million per year.
Under the Part 4, the details of the contract include an “Alabama clause.” Should Swinney leave for a job besides Alabama, the buyout would be $4 million through 2020, $3 million through 2022, $2 million through 2025 and $1 million through 2027. Should he leave for Alabama, he’d owe an additional $2 million through 2020, $1.5 million through 2022, $1 million through 2025 and $500,000 through 2027.
However, don’t expect Swinney to leave for Alabama anytime soon. Not with Dabonomics running the show at Clemson.
“I'm incredibly happy that we have now created a great commitment from Clemson to Coach Swinney and from Coach Swinney to Clemson. I think he's a generational coach and there's no coach better for Clemson than Dabo Swinney,” Radakovich said. “I'm very excited to have that put to bed and being able to move forward.
“His representatives were incredible, and we had great help from Chip Hood in our General Counsel office and Graham Neff. His representatives were Russ Campbell, and Patrick Strong really made this whole thing work seamlessly over the last seven weeks when the focus was placed on it. I'm happy for Dabo, Kathleen, and their family. More happy for the Clemson family because he will be here and be our football coach for a long while.”
Swinney, in an open letter to the fans, agreed.
“The magnitude and significance of the financial commitment Clemson has made isn’t lost on me, and to be honest, it is all indescribably humbling,” Swinney wrote in an open letter to fans.
“Last season, our team put together a historic season that we’ve called the ‘Best Ever,’ but as I recently told our 2019 team, the 2018 squad was the best ever … so far. I am proud of our program, what we represent and what we have accomplished, and I am even prouder to say that — now more than ever — the best is yet to come. This last decade has been an absolute blast, and I can’t wait to see what’s in store in the decade to come.”
Two final notes - I saw a lot of posts from people suggesting that tuition at the school would increase in an effort to pay Swinney's salary. That is not the case - Swinney's entire salary is paid through athletic department funds, accoring to Neff.
"There are no student athletic fees at Clemson, there are no institutional allocation dollars to athletics and all of our expenses we pay for with self-generated dollars from IPTAY, the ACC, and ticket sales," Neff said.
Also, Swinney's $245,000 base salary is not paid for with state dollars.
"It breaks out and I know in the state salary database it has those numbers, but that is really derived from how Clemson does our benefits thresholds," Neff said. "Those are not separately-paid dollars. That is all still athletically paid."