Harbaugh’s Michigan contract has base value of $40.1 million

AP

Before Jim Harbaugh decided to become the head coach of the University of Michigan, multiple reports pegged the pending offer at six years, $48 million.  Recently, ESPN’s Adam Schefter (a Michigan grad) called the package “the richest contract in college football history.”

A one-page term sheet provided to the media suggests otherwise.  But the package likewise isn’t as cash poor as suggested, either.

Characterized by Michigan’s A.D as the “same basic contract as 49ers,” it’s not.  Harbaugh made $5 million per year from the 49ers, and nothing more.  At Michigan, Harbaugh will get a salary of $5 million per year on a seven-year deal.  But the document plainly states that Harbaugh will receive a 10-percent increase after the third and fifth year.

If my math is correct (and it rarely is), that’s $5 million, $5 million, $5 million, $5.5 million, $5.5 million, $6.05 million, and $6.05 million.  It equates to a total of $38.1 million over seven years, an average of $5.44 million.  Throw in a $2 million signing bonus, and the average moves to $5.72 million.

He also gets $125,000 for each Big Ten title game appearance, and another $125,000 if Michigan wins (which puts up to $250,000 per year in play).  For any major bowl-game appearance, he gets another $200,000; the total is $300,000 if the team makes it to the four-team playoff.  Win the national title, and he gets another $500,000.

Winning the Big Ten coach of the year pays out another $50,000, and being named the national coach of the year by one of up to six different organizations triggers another $75,000.  Also, another $150,000 per year is available for academic performance.

That translates to a total incentive package of $9.275 million, pushing the maximum value of the deal to $49.315 million.

Finally, and perhaps most importantly, Michigan has agreed to “determine an appropriate deferred compensation arrangement” after the 2015 season.  Who knows how much more that will generate?

These numbers raise a couple of questions.  First, who was pushing the $8 million per year average?  Second, why is Michigan trying to downplay the value of the package?

As to the first question, we don’t know the “who” but the “why” has always been obvious.  Pushing it was $8 million per year set a bar that other NFL teams would then have to try to match or beat.

As to the second question, well, the answer is also fairly obvious.  With the players still getting nothing (plus snacks!), the higher the compensation for the coach, the more unseemly it all looks. So calling it $5 million per year, just like what he was getting from the 49ers, sounds a lot better than a $40.1 million guaranteed base package with up to $9.275 million in incentives, along with a commitment to determine appropriate deferred compensation, however much more that may be.

60 responses to “Harbaugh’s Michigan contract has base value of $40.1 million

  1. Jim, best of luck to you. I doubt Michigan will be a permanent home, and you’ll be back in the NFL soon. I’m sorry you had to deal with those two idiotic morons named York and Baalke. Thanks for making the Niners relevant again!

  2. In other news, the 49ers continue the search to find the next head coach that will eventually push out because “nobody got along with him.”

    Ridiculous.

  3. That’s too funny…. What are the odds that we would both have the EXACT same $40.1M contract ?

  4. I’m sure his agent was floating the 8 Mail a season cuz he figured the Raiders might be dumb enough to bite. Wouldn’t be the first time the Raiders over paid for something

  5. In 3 years, once he’s had a chance to bring in the staff he wants and recruit the players he wants, the Wolverines will be contending for national titles year in and year out.

  6. The Big Ten will become relevant again, and that’s good for college football. The $8 million a year rumor? I don’t know who initially floated it but it was a good one, got the media rolling on mob mentality and got Harbaugh some major bucks.

  7. With that kind of coin coming in , Jimmy can buy the entire state of Michigan and still have change left

  8. Let’s be honest, most of those incentives are basically unattainable. Is there a SLIGHT possibility that some of them could be reached? Sure. Is there a GOOD possibility that some or all of them will be reached? No way. To me, the biggest wild card in all of this is the “revisiting” of his compensation after two years, cuz you KNOW there’s no way his salary could be reduced, even if Michigan lost every game in those two years. Harbaughs agent would’ve never allowed it.

  9. Congrats Michigan. I now look forward to watching the Ohio State vs Michigan and Michigan vs. the Spartans.

    Now what the heck is young Jed going to do with my 49ers? Ugh!!!!

  10. That sort of money could pay something like 1,480 tuitions for Michiganders inclined to study there. It could buy a lot of computers, or pay for top notch professors. It could do a lot of things to actually educate people. Too bad it will just be going to win football games.

    Boy, I am glad I am from New York, where almost none of my tax dollars go to fund FBS football.

  11. “Deferred compensation” sure sounds like “whatever it takes to keep you from going back to the NFL, if UM wasn’t what you thought it would be after 1 year” to me.

    Plus, 10% raises after year 3 and 5 are hardly going to stop him from bolting then. By that point, top coaches in the NFL (him included, if he stayed) are likely making more than $5.5m, incentives added or not.

  12. Hard to imagine how these guys sleep at night making $40 million coaching “kids” who are getting brain and other long term bodily injuries for free.

    Oh, sorry, they are getting an “education” for their efforts. Sounds fair! Not.

  13. The most important question is, “Why didn’t I become a head coach?” You can stink up the place for a year or two and still be set up for life.

  14. so he took less money to go to college….just confirms he cant hang with the best coaches in football, just like saban, spurrier, holtz, groh, kiffin, erickson, wannsted, pietrino, etc….it just Harbaugh won at the nfl level.

  15. My favorite part of the contract is the academic bonus…we already know those academic bars are set embarrassingly low for NCAA football factories (and are often only met through shady maneuvers), so why not also annually give Harbaugh more than the average salary of the vast majority of Americans for *meeting* the bogus incentive?

  16. With the players still getting nothing (plus snacks!)

    Plus an education worth somewhere in the area of $20,000 per year but yeah keep ignoring that fact.

  17. Oh, sorry, they are getting an “education” for their efforts. Sounds fair! Not.

    Those darn diplomas do nothing for you when trying to start a career.

  18. h2beer says:
    Dec 30, 2014 1:36 PM
    As a Michigan alum, this is a grate singing, and theys no dout Harbah is the man!!!

    ___________________________________

    If your a Michigan alum, I fear that Jimmy boy may not hit his academic bonus in the contract.

  19. sdelmonte says:
    Dec 30, 2014 1:54 PM
    That sort of money could pay something like 1,480 tuitions for Michiganders inclined to study there. It could buy a lot of computers, or pay for top notch professors. It could do a lot of things to actually educate people. Too bad it will just be going to win football games.

    Boy, I am glad I am from New York, where almost none of my tax dollars go to fund FBS football.

    1 0
    Report comment
    —————————————————————-

    It’s also a good thing your not schooled in economics. Cause the proceeds from football not only floats the entire athletics dept but also supplements a lot of other programs at major universities. And if you think that this offer wasn’t base on “booster commitments” then you’ve lost you’re mind.

    Michigan makes 20,00o,000 a year on gate revenue alone. Forget the merchandise, concessions, parking and every other stream. Or the tv and radio contracts. Harbaughs contract is a drop in the bucket if it makes Michigan relevant again.

    And as a Seahawks fan, let me tell you…. he WILL make Michigan relevant again. And quickly.

  20. How can kids get a college education when many can barely read? Sounds like fraud to me. Many should have never been admitted in the first place.

    It’s fraud. Either pay them or have some long term educational program (even after their athletic eligibility) to first get their reading and math levels up before taking college level courses.

  21. @ sdelmonte:

    You are aware that Boeheim at Syracuse gets paid almost 2 million a year to coach basketball. A sport that brings in less than a 5th the revenue that football does right?

  22. All these 9ers fans bashing Balke, must be the same fans burning the kap jersey’s . Feel bad for the next head coach, 9er fans can’t let go and don’t support the team properly.

  23. There were some very rich and powerful UofM alum involved in this transaction and the AD had to give regular updates to them. Saban has a deal where boosters paid for his house taxes, expenses, and other benefits. There is a very high chance the full compensation package involves some hidden booster money and perks.

  24. Be afraid buckeye’s, be very afraid. We are about to replace that self-proclaiming undeserving “The” you had the gall to put in front of your lame university to an “A”.

    Your 15 minutes of fame is officially over!

    Bahahahaha

  25. bassplucker says:
    Dec 30, 2014 2:10 PM
    But… but… I thought his wife would NEVER let him leave the Bay Area???

    —————————————————-

    Jim explained to her it is much easier to get a new wife than a dream job that pays big bucks

  26. Being a public institution, the compensation package is going to be open to review anyway. Might as well come out now and be up front about it.

    He’ll be back in the NFL in 3 years.

  27. To be fair to Harbaugh I bet the Wolverines could beat the Raiders on the field right now. He just chose the team that has a better chance of winning the Super Bowl.

  28. If universities begin to pay football players I wonder how long it will be until some female lacrosse team somewhere sues claiming that title IX entitles them to the very same compensation.

  29. Not to mention the income from his radio and TV shows……and unrealized income from use of university jet (or swagcopter), one or two university Tahoes and likely a university-supplied house

  30. Doesn’t just about every player contract work similarly?

    potential earnings > actual earnings

  31. I still remember Mike Ditka just lighting him up on national TV when he was QB for the Bears. I wonder if that had anything to do with making him how he is today.

  32. He’ll never win anything of any importance at Michigan.Players win titles and championships.Michigan will not out-recruit Florida,Texas,California etc schools.A top recruit is not going to Michigan in the cold because Harbaugh is there.

  33. For the record, I don’t like U of Michigan or Harbaugh, but most of you don’t have a clue! You really think the Tuition goes up because they hired a $40M Coach… Have any of you every heard or Donations / Sports Boosters? Here is a fun fact… Stephen Ross, real estate billionaire and Owner of the Miami Dolphins gave $150M last year. Here is another fun fact… Guess who’s private jet flew the Harbaugh family last night from SF to Ann Arbor? Do you really think students or a state run school had a budget for this? Grow up and understand this is big business. It runs everything we do in this country including our government.

  34. h2beer says: Dec 30, 2014 1:36 PM

    As a Michigan alum, this is a grate singing, and theys no dout Harbah is the man!!!
    ======================================

    And you graduated from there with that atrocious spelling? You must be from OH.

  35. It’s not even as if he’s going back and coaching at the highest level. At least, Saban went to the SEC and returned that program to the top. That won’t be happening at Michigan.

  36. I just can’t wait to see a Harbaugh led Michigan team take the field and play football. It just makes me think of Bo Schembechler. Life is better when Michigan and Ohio State are both top 5 teams. Bo would be very proud of Jim and happy that Michigan hired a “Michigan guy”.

  37. I wonder if there’s a recent grad out there being crushed by his/her student loan who would agree with the premise these athletes are getting nothing (Plus Snacks) ?

Leave a Reply

You must be logged in to leave a comment. Not a member? Register now!

This site uses Akismet to reduce spam. Learn how your comment data is processed.