On an unseasonably warm evening in October 2017, Gus Malzahn arrived at his postgame news conference wearing a striped Auburn polo and traces of a scowl.
The Tigers had just blown a 20-point lead on the road against LSU. They were 10-10 in their past 20 games in the Southeastern Conference. They hadn’t beaten Alabama or Georgia in nearly four years. And their past three seasons had ended with records of 8-5, 7-6 and 8-5.
“It’s not the end of the world,” Malzahn told reporters.
In Auburn country, however, there was a growing sense it might soon be the end of Malzahn’s time on the Southern plains.
Then, in a span of just seven weeks, everything changed. Auburn clobbered then-No. 2 Georgia and dominated then-No. 1 Alabama. Malzahn went from coaching on the hot seat to signing a seven-year, $49 million contract extension — complete with a massive buyout clause that won’t dip below eight figures until 2023.
That buyout — which would be more than $27 million at the conclusion of the regular season — was intended to give Malzahn some much-needed stability, to cool a proverbial seat that always seems to be warm. Instead, it has become a potential complicating factor.
The 10th-ranked Tigers might be 6-1, but a murderers’ row of LSU, Georgia and Alabama awaits — and, if history is any indication, the narrative surrounding an Auburn coach can change quickly.
“The buyout that Gus has gives you a level of security,” former Tigers coach Gene Chizik told USA TODAY Sports. “But it doesn’t guarantee you anything.”
This, after all, is the same Auburn that fired Chizik two years after he led the school to a national championship. It’s the same place where administrators secretly borrowed a booster’s plane to meet with an opposing coach while its current coach was still employed. It’s the place where Terry Bowden beat Alabama, won the SEC West Division in a 10-3 season — and then was pushed out less than a year later.
“I got a job that expects to win championships, and I expect to win championships,” Malzahn told reporters at SEC Media Days in mid-July. “Some places (get) eight wins, they celebrate. That’s just not part of Auburn.”
So what does that make Malzahn’s buyout? A source of stability, or a price tag that wouldn’t stop the school from getting rid of him, only make it significantly more expensive?
Malzahn, athletics director Allen Greene and interim university president Jay Gogue all declined to be interviewed for this story through university and athletics department spokespeople. Jon Waggoner, the secretary to Auburn’s board of trustees — which is required to approve contract extensions like Malzahn’s — told USA TODAY Sports in an email that neither he nor board members were “appropriately positioned to discuss personnel matters.”
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In response to multiple interview requests and questions about Malzahn’s contract, the university issued a written statement from Greene, who said Auburn is “committed to investing in the success of its athletics programs and our student-athletes.”
“The Auburn family is excited about the direction of our football program,” Greene said in the statement. “The Board just approved a new football facility, Coach Malzahn is on track to have one of our best ever recruiting classes and he has the team playing hard-nosed Auburn football. They’re getting better every week while playing one of the nation’s toughest schedules. We have a lot to be excited about in football and all our other athletics programs.”
The impact of ‘JetGate’
In a world of skyrocketing coaching salaries and seemingly-endless contractual perks, only four public school coaches in the Football Bowl Subdivision have larger buyouts than Malzahn’s this year, according to data from USA TODAY Sports’ annual review of coaches’ compensation: Texas A&M’s Jimbo Fisher, Clemson’s Dabo Swinney, Alabama’s Nick Saban and Purdue’s Jeff Brohm.
Massive coaching buyouts — and salaries, generally — are nothing new. At least 83 FBS head coaches will make $1 million this year, including Malzahn, whose $6.83 million in total compensation ranks sixth in this year’s database. Fifty-three coaches would also be due $5 million or more if they were fired without cause on Dec. 1, though some would have a contractual obligation to look for a new job and mitigate the payout.
Malzahn’s deal has no such provision. If he is fired without cause at any point, he is due 75% of whatever is left on the deal, without restrictions. Half of his buyout, or roughly $13.5 million as of Dec. 1, would be due in a lump-sum payment within 30 days of his departure.
Bob Lattinville, an attorney with the law firm Spencer Fane LLP, said he believes the increase in guaranteed compensation is the result of athletics directors operating in fear. There’s so much pressure to make “defensible” coaching moves these days, Lattinville said, that the fear of failure and criticism has led to premature contract extensions and unnecessary buyouts.
“If you’re good, you’re going to get paid that as part of salary. If you’re bad, why should (universities) also pay you that as part of a severance?” said Lattinville, who assists USA TODAY Sports with its annual compilation and analyses of coaches’ compensation.
“I look at that and it’s kind of an exponential benefit for the coach. … I think that’s really counterintuitive, and I don’t think universities are paying attention to that. And they need to.”
Buyout clauses have been part of coaching contracts for decades, but the money involved has grown exponentially over the past 15 years — at least in part due to a scandal at Auburn that’s become known as “JetGate.”
In 2003, Auburn administrators were caught secretly meeting with Louisville coach Bobby Petrino about the possibility of taking over for coach Tommy Tuberville, who was set to coach the Tigers in the Iron Bowl against Alabama that weekend. News that the school had considered paying the buyout in Tuberville’s contract — $4 million, a whopping sum at the time — gave coaches and their agents enough leverage to ask for higher buyouts.
Tuberville, for his part, led Auburn to an undefeated season the following year — and brokered a seven-year contract with a $7 million buyout shortly thereafter. He said he thinks buyouts serve a critical role for coaches whose job security is always in flux.
“I can’t imagine not having buyouts in some of these contracts,” said Tuberville, who is now a Republican Senate candidate in Alabama. “The big thing you’ve got to remember is it’s not just about one person. It’s about 100-150 people. It’s the assistants and their wives and families. It’s the strength coaches and their wives and families.
“When the head coach has got that kind of buyout, I think (there’s) security for all the families involved. I think it’s really helped college football.”
‘The perfect storm’
To understand how and why Malzahn went from coaching on the hot seat to signing a $49 million extension, it’s important to understand the timeline.
Less than three weeks after Auburn’s loss to LSU in 2017, athletics director Jay Jacobs announced his intention to retire in the coming months, setting the stage for Malzahn to possibly follow him out the door. Then came the wins over longtime rivals Georgia and Alabama — which, when taken together, were enough to save Malzahn’s job.
“You have a great year if you win one of those two,” said athletics director emeritus David Housel, who spent 40 years at Auburn as a student and an employee. “But if you win both of them, you have a very special year.”
Between the Georgia and Alabama games, meanwhile, a complicating factor emerged: Arkansas decided to fire both its athletics director and head coach, creating a high-profile vacancy in Malzahn’s home state, where he had been a longtime high school coach before entering the college ranks.
Before long, Arkansas was being reported as a suitor for Malzahn and Auburn was facing pressure to re-sign him, even though neither school had a full-time athletics director. Auburn’s president Steven Leath, who had been on the job for just eight months, became the point person in negotiations with Malzahn’s high-powered agent, Jimmy Sexton, who had just negotiated a $75 million deal for Fisher at Texas A&M.
Lattinville said the administrative turnover at Auburn created “the perfect storm” of leverage for Malzahn.
“There wasn’t really anybody at the wheel when that happened,” Lattinville said.
Leath did not respond to numerous messages left for him via phone and email. But two days after Malzahn agreed to his huge new deal, Arkansas hired Chad Morris, another Sexton client, and gave him a six-year deal worth $21 million — less than half of what Auburn wound up agreeing to pay Malzahn.
A few weeks after the final signature was added to Malzahn’s contract, Auburn’s board of trustees approved a series of revisions to its bylaws, including a new clause that requires the university president to report “the total financial exposure and buyout risk” of coaching contracts when presenting the annual budget.
The revised bylaws, which had been discussed at a November workshop, also reiterate in three separate places that any non-faculty contract or extension with a buyout provision must be approved by the full board, or its designees. (Athletics contracts, for example, require approval from only three board members, including the lead trustee for athletics.)
Leath, meanwhile, was ousted in June after less than two years on the job. Auburn said in a news release that he and the school “mutually decided to part ways.”
The 62-year-old reached a separation agreement with Auburn that includes a non-disparagement clause, and the university will pay him $4.5 million over three years.
“I think part of the problem at Auburn is there’s not always an alignment, and everybody being on the same page, and everybody being on board,” said Chizik, whose two daughters are students at Auburn.
“It’s a phenomenal place. They’ve got some great things going on. But for them to have continued success, they need to be in full alignment at all times.”
The Alabama effect
When Leath first announced Malzahn’s contract extension in late 2017, he billed it as something of a reflection of the football program and where it was heading.
“Strength and stability go hand in hand,” he said, “and we have both in Coach Malzahn.”
But last year, as Auburn neared the end of an 8-5 season and a fifth-place finish in the SEC West, the rumors about Malzahn began to swirl again. There were reports that Auburn reached out to Bob Stoops about replacing Malzahn (which Stoops denied) and that the school offered to retain Malzahn only if he accepted a smaller buyout (which Malzahn has publicly refuted).
Chizik, who is now an analyst with the SEC Network, said there’s always been a win-now pressure at Auburn, which counts itself as a perennial powerhouse in college football’s most competitive conference. But “it’s gotten worse,” he said, because of the success of Alabama, which has won five national titles in 10 years under Saban.
“That’s where the pressure is so high, to be able to have a team that can compete (with Alabama),” Chizik said. “And because of that, you have pressure to deliver at Auburn every single day. And if you don’t, to the satisfaction of the people that make decisions, then your job is going to be on the line.”
Only five active coaches have beaten Saban over the past 10 years, and Malzahn is the only one left in the SEC. Chizik, who previously employed Malzahn as his offensive coordinator, said he believes that is one of the reasons the Tigers chose to give his former assistant that lucrative 2017 deal — and why the school would be silly to let him go, even if, financially, it is able to do so.
Any potential buyout payment would come amid a string of significant facility investments at Auburn. The university has spent $54.3 million on major upgrades to various football facilities over the past decade, and the board recently voted to move forward with plans to build a “football performance center” at a still-to-be-determined cost.
However, the Tigers Unlimited Foundation, a legally separate 501(c)(3) organization that serves as the fundraising arm of the Auburn athletics department, reported more than $22 million in unrestricted assets in 2018 — signaling that the department would, theoretically, have enough cash at its disposal to cover the initial payment required by Malzahn’s buyout, should Auburn choose to go that route.
“At any point in time, if they need and want to find the money to make a change, they can do it,” Chizik added.
The problem is the optics of such a move.
“If you’re an athletic director and a president and a board of trustees, you’ve got to think long and hard before you pull the trigger in this day and time on some of these buyouts,” Tuberville said. “Because it doesn’t sink in too well with people on campus, your professors, different colleges.”
The largest known buyout clause that has been executed in college football involved Charlie Weis, who received just under $19 million over six years after he was fired by Notre Dame in 2009. Malzahn’s buyout would surpass that amount even if he was fired at the conclusion of the 2020 season.
In fact, Malzahn’s current buyout of $27 million would actually require payments of more than $33 million when factoring in the buyouts of his staff, including coordinators and assistant coaches. That amount could cover the entire cost of a new engineering laboratory that’s being built on the university’s campus, or fund the annual salaries of about 1,200 residents in Auburn, according to the most recently available US Census data.
For now, Malzahn appears to be safe, though the second half of the season — starting Saturday at No. 3 LSU — could prove to be pivotal. Beat Georgia and Alabama and it’s another special year. Lose in spectacular fashion and the questions will only grow louder. There’s no telling what the future might hold for Auburn — and its $49 million head coach.
Contact Tom Schad at email@example.com or on Twitter @Tom_Schad. Follow Steve Berkowitz on Twitter @ByBerkowitz.
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