Loh reflects on unfolding of Big Ten talks - The Diamondback : News

Loh reflects on unfolding of Big Ten talks

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Posted: Monday, November 26, 2012 12:16 pm

Wallace Loh’s athletic department has been counting pennies. The university’s programs have barely had enough resources, faculty and staff to thrive, and officials have kept making cuts across the board. The university president wasn’t sure how the school would continue down this path.

And then it hit him: There could be a way out. The athletic department wouldn’t have to rely on ticket sales, which had been slumping. It wouldn’t have to hope alumni would make gracious donations. It wouldn’t have to worry about the possibility of cutting more sports teams.

The university could cut ties with the ACC, a conference it helped found nearly 60 years ago. It could join the Big Ten, with its mega TV contracts and its own cable network with millions of subscribers.

Loh was only two years into his presidency. If he made the move, it would be his legacy, for better or worse. He would effectively alter the course of the university’s future — to the outrage and despair of many.

After more than a month of studying the potential move with analysts, legal experts and top university and state officials, Loh made it official Nov. 19. The move has been far from popular — students, alumni and fans have chastised the decision, calling it a “money grab” — but Loh felt it was crucial for the future. Joining the Big Ten means substantially more money not only for a starving athletic department, Loh said, but for a university in dire need of funds.

When the news first came out, Loh said the university and the conference had been in talks for about a week. But it all started with a phone call from a Big Ten representative in early October. The conference was thinking of expanding, and officials wanted to know if Loh was interested.

“Sure, I’ll talk to anyone about anything,” Loh said.

The idea was first proposed in the fall of 2010 under then-President Dan Mote’s administration, according to Loh. At the time, university officials dismissed the idea and said they weren’t interested.

But when the question arose again early last month, Loh decided it was an option worth exploring.

He conferred with Chancellor Brit Kirwan, who has been with the university since 1964 and also served as president of Ohio State University, one of the Big Ten’s members, for four years. Kirwan said he told Loh he should have a conversation with conference representatives but didn’t think it would lead to anything more.

Shortly after the phone call, Loh and Athletic Director Kevin Anderson boarded a plane to Chicago to meet with conference representatives.

The pair knew nothing was definitive. The Big Ten wasn’t even prepared to make an offer. They would listen to the conference’s representatives “as a matter of courtesy,” Loh said.

They signed confidentiality agreements before Big Ten representatives divulged the conference’s “stunning” finances.

Although the Big Ten’s members are primarily from the Midwest — such as universities in Illinois, Indiana, Michigan and Nebraska — officials told Loh and Anderson geographical boundaries no longer mattered. It was time to begin moving farther into the East Coast and the mid-South.

Because the money, officials said, is now mostly made from televising games.

The Big Ten is a revenue-sharing conference, meaning each member makes the same amount from ticket sales and television revenue from both the conference’s contract with ESPN and its own Big Ten Network.

As two people who had just cut seven teams from the university’s athletic department, Loh and Anderson couldn’t help but wonder what having that sort of money would mean. The cuts were heartbreaking but necessary to balance mounting deficits projected to reach $4.6 million in fiscal year 2011 without drastic changes. Sure, the athletic department, according to officials, was beginning to bounce back, but its entire recovery depended on ticket sales and projected donations — factors it simply couldn’t control.

And now, there was a chance to quickly fix the problem that could otherwise take years to solve. So the two top officials decided they would consider leaving the ACC if it meant more money for athletics and the university.

But they had to wait and see what would happen. They didn’t know if Big Ten representatives would even follow up.

Three or four weeks passed with no word. But in early November, Loh received another call. Big Ten officials wanted to discuss the prospect further.

Loh hardly sat and waited during that time. Between the first October meeting and the call in November, he assembled a “high-powered coalition” of 25 to 30 people. He knew he needed to be fully prepared if the Big Ten decided to continue talks. His team included top state and university officials and prominent donors, along with financial analysts, experts in conference and cable network deals, a former athletic commissioner and former athletic administrators.

But building up that coalition of support was no easy task. When Loh told people he was thinking about moving, the immediate reaction was always the same: “You’re crazy.”

For 38-year staff member Linda Clement, the possibility of not being in the ACC was hard to fathom.

“Initially, it was a shock. It was a joke,” the student affairs vice president said. “We had this identity for so long.”

Loh didn’t expect much else. He knew the idea was unprecedented. He knew he needed to meet one-on-one with each person and explain why the move could be beneficial.

He started with his inner cabinet and Kirwan before conferring with the chair of the university’s Board of Trustees, top state elected officials, select alumni and top donors. After explaining the move’s financial implications, which he still cannot discuss in detail because of a confidentiality agreement with the Big Ten, he said people changed their minds.

Kirwan supported the move, but had one condition: The increased revenue couldn’t just go to athletics. It also had to support the academic mission of the university and aid other programs.

While numbers weren’t concrete when Loh formed the coalition, he knew Big Ten schools made more than $24 million in fiscal year 2011. Under the ACC’s contract, the university makes about $17 million each school year.

If just a few members of his coalition didn’t support the move, Loh would call it quits. But every member eventually backed his decision.

“When the team began investigating and understanding what this meant, I think we all reached a similar conclusion,” Clement said. “We had been part of the ACC and hadn’t thought about what goes on in other conferences.”

Loh was ready to withstand any firestorm if he continued moving forward.

When Loh and his team met with Big Ten officials Nov. 8, it wasn’t about just an idea. Big Ten Commissioner Jim Delany flew to Washington with a legal team, and Loh brought along his own team, which included Anderson. They confidentially met in a hotel in Washington, evaluating possible revenue and discussing the implications of the university joining the conference.

Before they could formalize a realignment, Loh and Delany needed to reach a financial agreement. And even after the seven-hour meeting, they were still “far apart” on the details of an agreement, Loh said.

But that hardly meant the discussions were over.

Fortunately, rumors of a potential move hadn’t leaked from the first October meeting to the Nov. 8 meeting. That could have terminated the potential solution to so many budget woes.

“I knew once the rumors started and start cascading, that could kill the deal,” Loh said. “You just can’t negotiate under those circumstances.”

The stakes were high. Loh had staff members keep a close eye on blogs and newspapers to see if any of them picked up on the negotiations.

By Nov. 13, the rumors started flying. Loh needed to move quickly before the opportunity vanished.

On Saturday, Nov. 17, Loh hosted about 300 people at the new president’s residence for a tailgate before the Terps football team took on Florida State. While guests mingled outside, enjoying drinks and food, Loh was sequestered in his locked kitchen, a few key staff members by his side, for a phone call with Big Ten officials.

“The host is not even at the reception,” Loh said. “It’s that kind of intensity.”

By 10:45 a.m., the deal was set. Pending the approval of the Board of Regents — a 17-member governing body that oversees the University System of Maryland — the university would cut its ties with the ACC on July 1, 2014, and become the Big Ten’s 13th member.

Delany and his team would fly into Washington on Nov. 18 to put the deal in writing.

Yet there was still one problem: Loh wanted the board to discuss and approve the move. The decision rested with Loh, and he didn’t need its approval, but he asked for it — and was prepared to tear up the contracts if he didn’t get the endorsement.

The board had first heard about the potential move Nov. 15, before there was a final deal. On Sunday, Nov. 18, Loh had a telephone conference with the regents. On Monday, they had to vote.

“It was now or never. And now meant Sunday,” Loh said. “I made it very clear now or never means if we don’t do this, this will not be done in my lifetime. In other words, the chance for the University of Maryland to join the Big Ten will disappear for an entire generation, and that’s why these things cannot be done in the public spotlight.”

The board met the next day in a closed-door session, where it voted to support the move.

The closed meeting, however, prompted news outlets, students and alumni to question whether it had violated the state’s Open Meetings Act, which requires state and local bodies to hold their meetings in public, give adequate notice of the meetings and allow the public to look at minutes from the meeting and other records. The act also stipulates that certain topics can be discussed “behind closed doors,” but certain steps must first be taken.

People wanted to be part of the discussion. But signed agreements with the Big Ten prohibited it, a standard practice in conference realignments and monetary issues.

Bradley Shear, a sports lawyer and sports management professor at George Washington University, said it’s still unclear whether the board was in compliance with the act. Arguments could be made that the university’s confidentiality agreement with the Big Ten warranted a private meeting, Shear said, and because the vote was not necessary to make the move, “the whole argument is moot.”

“There’s some issues here that really demonstrate it’s questionable whether they violated the act or not, because usually in these situations you have to err on the side of caution,” Shear said. “If the regents didn’t need to meet to OK the decision, I think people are really barking up the wrong tree.”

And even if he could invite the public in on the decision, why bother, Loh thought. He could predict the reactions. Of course no one would support the move upon first hearing about it. It seemed like lunacy.

Loh planned to disclose financial information to the board before the regents voted. Few people outside of the negotiations had seen the documents Loh was about to present.

“With the advice and counsel of the Office of the Attorney General, the board convened in a closed session and voted to endorse the university’s application,” board Chairman James Shea and Kirwan wrote in a joint statement. “The Maryland Open Meetings Act does not preclude public boards from taking action in closed session.”

With the endorsement behind him, Loh could focus on the next, perhaps most difficult, step: making the public announcement.

Loh, Anderson, Kirwan and Delany were set to appear on the Big Ten Network at 3 p.m. on Nov. 19, to formally announce the move and answer reporters’ questions in a news conference. But before that, Loh said he called ACC Commissioner John Swofford to personally inform him of the move.

The process has been far from easy, but to Loh and several university officials, it’s worthwhile. It means the university can afford more resources across the board, and the athletic department can do more than simply recover.

And the conference the university is leaving is far from the one it helped found decades ago, Kirwan said.

“It’s a new ACC, and, quite frankly, when I look at the mix of schools in the two conferences, I think the more appropriate alignment academically is the Big Ten,” he said. “You don’t just leave an organization you’ve been part of for many, many years, but I also recognized that the ACC isn’t the ACC we all think about historically.”

While Loh cannot disclose numbers, Sports Illustrated obtained documents showing the university is projected to make about $100 million more in the Big Ten by 2020.

With the added money, the university will be able to bring back some of the teams it cut, strengthen its existing teams, set aside money for scholarships and help fund some educational programs, Loh said.

“Your typical sports fan lives for the day, the game, today, tomorrow or the season, and then looks to the past for the glorious sports tradition,” Loh said. “But they’re not thinking 10, 15 years ahead. My job as president is to ask two questions: Where should the university go, and how is it going to get there?”

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