A Saga Worthy of an Investment Bank: Steve Alford Bolts the University of NM
As you watch student athletes run up and down the court in the Elite Eight round of the NCAA Men’s Basketball Championship, the business side of this “amateur” sport has produced another ugly chapter. Athletic programs are subject to all kinds of picayune rules, and the NCAA drums athletes out of college for relatively small violations. Meanwhile, coaches operate by ethical standards that are worthy of Wall Street. While University budgets are being slashed, basketball coaches are reeling in millions of dollars.
Despite losing to Harvard in the first round of the NCAA Tournament, Steve Alford has led the University of New Mexico to a series of conference championships and tournament appearances. Earlier this week, the University rewarded the coach with a ten-year contract extension. In reaching this extraordinary agreement with the University, Mr. Alford said:
“There is no other place I would rather coach than at UNM, representing the best fans in the country. I appreciate all of the efforts of my staff and student-athletes over the last six years in building a championship program.”
The agreement was to go into effect on April 1st. However, while the ink was drying on his new agreement, Mr. Alford was off in Los Angeles talking to athletic officials at UCLA. This morning, Mr. Alford signed a 7-year, $18.2 million contract with UCLA. Mr. Alford didn’t have the decency to call New Mexico’s Athletic Director, Paul Krebs. Rather, he sent him a text message informing Mr. Krebs of the deal. In leaving New Mexico, the coach said:
“I love the University of New Mexico, I love Albuquerque and New Mexico. This is truly a leap of faith decision. I think it becomes easier when it’s UCLA. You’re talking about the premier basketball program in the country. This kind of opportunity doesn’t come around every day.”
Several hours later, he then told the UCLA community:
“I have been so fortunate and blessed in my life, and an opportunity to lead the one of the greatest programs in college basketball history is once-in-a-lifetime."
The contract with the University of New Mexico was laced with bonuses and incentives that increased Mr. Alford’s total compensation well above the old package which paid him well over $1 million per year. While UCLA did not release any details, it looks like Mr. Alford got himself a nice little raise. There’s a bit more to this transaction. Mr. Alford said that his son, Bryce Alford, who had signed a national letter of intent to play for his father at UNM, would instead go to UCLA.
Clearly, Mr. Alford’s words, both written and spoken, don’t mean very much. One minute he’s pledging undying loyalty to New Mexico, and days later he’s expressing unending devotion for UCLA. While Mr. Alford is a proven winner, I wouldn’t my son to his set of values. Even the coaches who turned down UCLA and stayed at their current jobs put pressure on their athletic director to sweeten their contracts. Big-time college coaches preach selflessness and integrity to their student-athletes. Their actions teach student-athletes selfishness.
If Mr. Alford wants to maximize his economic prospects, he should test his skills in the NBA and not exploit student athletes. I should turn off the television, but I still have a chance of winning my bracket.