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UC Regents assert they can block UCLA move to the Big Ten, citing potential damage to Cal
Will they is another question altogether. There is still a long saga ahead.
At the behest of California governor Gavin Newsom, The UC Regents had a long and frankly uninteresting open session yesterday that mostly indicated that the regents do not follow college athletics that closely.
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However, after the closed session, there were several clear indicators that UCLA’s move to the Big Ten isn’t quite settled yet. Counter to earlier speculation, several members of the governing board of the University of California indicated that they do have the authority to decide whether UCLA can leave the Pac-12 along with USC.
“It’s important to understand that when the regents delegated authority to the president, they didn’t give it away or lose it,” UC system attorney Charlie Robinson said during a regents’ meeting at UCLA’s Luskin Center. “Essentially, what they did was extend it such that authority was with the regents and the president.”
These sentiments were echoed by regent John Perez and chair of the board Richard Leib.
“All options are on the table,” Perez repeated, “up to and including that. … We’re going to look at what all the different options look like and then the board will assert itself in terms of what its desired outcome is.”
“We always have the ability to retain authority,” Leib said, “which is what we heard today.”
The Regents cited potential damage to Cal and the UC system as a problem with UCLA’s approach.
UCLA’s decision to apply for membership in the Big Ten Conference revealed potential gaps in the University’s oversight model in at least two respects:
The decision could create adverse impacts on UC Berkeley and could have had meaningful implications for other UC campuses, and therefore may have benefited from a systemwide perspective to assure that University interests as a whole were adequately considered. Chancellors are charged with promoting the overall welfare of their campuses and are often not best positioned to consider the University-wide perspective because of the inherent conflicts of interest.
Severe time constraints precluded the Regents from being in a position to offer any meaningful input into the decision.
This was echoed by UC Regent Tony Thurmond.
The proposal suggested by the Regents indicated that the major prongs of investigation before the September meeting all have to do with potential financial and reputational damage to Cal.
The University President would retain authority to decide all matters regarding athletics programs except those matters previously reserved to the Regents, i.e., coach compensation parameters and Regents Policy 3501 (Option 2 above). Such authority would be subject to limitations on re-delegation for matters involving athletics affiliations and other transactions, including athletic conference memberships, that meet one or more of following criteria:
• The proposed transaction likely will have material adverse financial impact on other campus(es) in the UC system—for purposes of this provision, “material” means an adverse impact equal to or greater than 10% of the operating revenue(s) of the athletic department(s) of the other campus(es);
• The proposed transaction raises a significant question of University policy; and/or;
• The proposed transaction likely will create significant risk of reputational harm to any campus or to the University.
Bullet point 3 is unlikely. UC Berkeley is not going anywhere. Bullet point 2 doesn’t seem to apply. So we’re left with bullet point 1, where yes, Cal is expected to lose a significant chunk of operating revenue.
As interesting as all these quotes might be, will it actually lead to a block of UCLA’s attempt to leave the Pac-12?
Another one of the findings was that USC appears to be responsible for the bulk of the media revenue loss. So UCLA’s return would likely result in financial loss for both UC programs.
The question, particularly regarding the above bullet point, is how much money Cal would make with UCLA in a Pac-11. It’s close.
The Big Ten signed a record TV deal this morning worth a billion a year, meaning probably about $60 to $70 million in payout money a year for UCLA. Saddling them back in the Pac-12 would likely mean cutting that annual payout in half.
Regardless of all the hemming and hawing and posturing, UCLA is projected to bring in at least double the annual revenue in the Big Ten than it ever did in the Pac-12. That sort of revenue windfall is just hard to ignore, and the regents would be hard-pressed to turn their nose up to that..
Additionally, there were plenty of regents who seemed a little out of the loop as to what exactly was going on.
And yes, while the Regents do have the power to scrap the deal, nowhere did they indicate their intentions to do so.
This will almost certainly come down to one particular financial analysis—is the loss of UCLA to the Big Ten a big enough loss to Cal to justify bringing them back?
My guess is, at worst for UCLA, if Cal is judged to be there will likely be some financial penalties that will assist in mitigation of damages. So the Bruins might be asked to financially payout their big brothers in Berkeley an offset of their athletic revenue to cover.
Or, if the Regents actually care about financial damage, the members of the board work with the Cal athletic department in getting the Golden Bears a Big Ten invite in the next few years. The case is there. And it solves a lot of annoying financial headaches for all parties.
Safe it to say, the chances UCLA is actually blocked are relatively low. There are far more realistic scenarios at play.
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