What did the schools get out of the deals?


What did the schools, the athletic departments or their marketing partners get?

Payoffs, or as the contracts more euphemistically  put it, “donations” from a corporate sponsor.

The greater the volume,  the bigger the payoff.

The 2005 contract with the Florida Atlantic University Department of Intercollegiate Athletics spells it out succinctly:

  • University Financial Services (UFS) guarantees a minimum $15,000 to Florida Atlantic.
  • The athletic department pocketed extra cash, or “donations” based on the number of funded loan applications:

 

Funded Applications Payoff Per Application
0-250 $50
251-500 $65
501-1000 $90
1001 or more $100

 

More loans translate into bigger guarantees. One 2006 contract with International Sports Properties (ISP Sports) sets the “guarantee fee” by tier for nine schools. Tier 1 schools received guarantees of $35,000 while Tier 2 schools received $25,000.

The contracts contain one other benefit for athletic department staff: cut rate loans.