Calculating the value of college football coaches
Nick Saban the Head Coach of the Alabama Crimson Tide talks with the game officials during the SEC game.
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JEREMY HOBSON: Missouri faces Iowa tonight at the Insight Bowl in Arizona. If you watch that game -- or any other college football bowl game -- you probably won't be thinking about how much the coaches are being paid. But in some cases College football coaches are pulling in multi-million dollar salaries. And those salaries are going up even as public universities face financial strain.
Gigi Douban reports from Birmingham, Alabama.
GIGI DOUBAN: Crystal Bishop is cashing out her drawer at the 15th Street Diner in Tuscaloosa. This is home of the University of Alabama's Crimson Tide football team. Bishop is baffled that head football coach Nick Saban earns $5 million a year.
CRYSTAL BISHOP: I think that's entirely too much. Only thing he do is write charts, x's and o's on a chart, and get paid $5 million.
So it's not quite that simple. Even Bishop agrees that Saban put Tuscaloosa back on the map.
BISHOP: I guess without the UA, Tuscaloosa would be nothing.
This is how college officials make the case for why some coaches are easily worth millions of dollars a year. Mal Moore is athletics director at the University of Alabama. He says when Saban took Alabama to a 2009 National Championship, fundraising at the university shot up.
MAL MOORE: Even with the down economy, the royalties that came to the university I think was very strong.
Royalties from sales of Crimson Tide jerseys, oven mitts, even garden gnomes.
Now of Saban's $5 million salary, the university pays $245,000. The rest comes from things like fundraising groups, endorsements, speaking fees. And, Moore points out the athletics department pays for itself. One way it does that:
MOORE: Faithful fans that buy their tickets and come to the games year in and year out.
But that's changing. The Associated Press reports that some schools are having a hard time filling seats for upcoming bowl games. And with a down economy and public university budgets hurting, athletic departments have less money to play with. So universities are increasingly subsidizing sports programs, says Doug Lederman. He's the editor of Inside Higher Ed.
DOUG LEDERMAN: And at that point the argument about how much is being spent on the athletics programs themselves starts to change a little bit because it is more clearly university money and money that could be going to the library, or could be going to faculty salaries.
But unlike professors, there's no tenure track for a coach. One or two losing seasons, and that high-priced coach is out the door.
In Tuscaloosa, I'm Gigi Douban for Marketplace.