“If you can’t play in the fall, then let’s get through the virus,...
Pac-12 Networks and the Pac-12 Conference, a leader in collegiate athletics that is made up of 12 of the most prestigious universities in the world. 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.Each athletic department could decide whether it wanted to participate in the program.If all 12 opted for the maximum amount, the total would be $996 million.“The conference is trying to be nimble and give schools some options,’’ a source said.However, multiple sources indicated that not every school would make use of the loan, and some would seek substantially less than the maximum allowable. The only consensus is the conflicting viewpoints. All Rights Reserved. Pac-12 football 2020 preview: Ranking the schedules in a conference-only format Coronavirus forced the Pac-12 to overhaul the schedules; some are tougher than others
Pac-12 football has overcome two World Wars, one Great Depression, the Spanish Flu, California earthquakes and a slew of other epic societal events, but it couldn't beat coronavirus. “They’re trying to get the core (academic) programs through for the next three years without firing people.“If other people have debt capacity, they should use it.”The impact of a shuttered football season would be monumental.Meanwhile, several schools were carrying massive deficits With campuses fully leveraged, the presidents are turning the Pac-12 into a de facto debt facility.Thanks to the media rights contracts with Fox and ESPN that are worth $1.2 billion over the next four years, the conference has the collateral necessarily to secure a massive loan.Even with a canceled season, the outstanding payments owed by the networks to the conference for the 2022-24 fiscal years — $917 million, according to the term sheet — would be enough to cover the loan, assuming every school did not take the maximum.Multiple conference sources indicated the private schools, Stanford and USC, would be unlikely to participate in the program, and several of the public universities would opt for substantially less than the $83 million maximum.Responsibility for the loan starting in 2024, when the current media rights deals expire, could shift to the universities, which at that point would be in better financial position to assume the debt.Another option would be for schools to repay what they owe using the proceeds from the new media rights contracts, which are expected to provide a significant increase in annual revenue.The idea to use the conference as the facilitator of the loan seemingly came from Cal chancellor Carol Christ.In an email dated April 27, Oregon president Michael Schill writes to Washington president Ana Mari Cauce and Colorado chancellor Phil DiStefano:“(Christ) asked about the Pac 12 borrowing to help us with this coming year’s potential unprecedented problem.