Photo by Mike Schumann / The Daily Hoosier

What Scott Dolson has to consider in making the decision on Archie Miller

It wouldn’t have taken much for Scott Dolson to be spared this decision in his first year as Indiana’s athletic director.

Archie Miller is in the fourth year of a seven-year contract with a buyout over $10 million due to him if he were to be terminated. That’s nearly a prohibitive amount of money to start with, and it’s even worse in a year in which a pandemic has rocked the nation’s economy and prevented college sports teams from allowing enough fans to attend games to create meaningful revenue streams. The Hoosiers haven’t been to an NCAA Tournament in Miller’s tenure, but at 20-12 they would have earned a berth last season if the event had been held. Realistically, all they had to do was come close to an NCAA bid in 2021 and Dolson could have retained Miller without even saying much about it.

But in 2020-21, the Hoosiers failed to even meet that charitable standard finishing 12-15 with six straight losses to end the season. They were safely on the right side of the bubble when the losing streak began, but after their Big Ten tournament loss to Rutgers they can barely see it in the distance. Indiana collapsed in late February and early March, falling all the way to 10th in the 14-team Big Ten. The style of play was unsightly enough, especially on the offensive end, to provoke fan outrage. In the season’s last four games, they made just 13 of 74 3-point shots and failed to score 60 points in any of those games. They scored just 50 in their loss to Rutgers and failed to make a field goal in the last 9:50 of the season, missing their last 13 shots. Fans at Lucas Oil Stadium getting to watch the Hoosiers for the first time all season were chanting “Fire Archie,” by the time it was over.

When Dolson was promoted from deputy athletic director to replace his boss Fred Glass, the Miller’s seven-year deal seemed like a blessing or a gift to make sure he had time to get his feet set and deal with all the effects of the COVID-19 pandemic before he had to make his first big decision on a coach. Instead, it makes the decision a lot more complicated. If Miller had a five-year deal, moving on would be an easy call. Instead, he has to weigh how much it would cost in buyout money to make Miller go away versus how much it could cost in fan apathy and eventual losses in gate receipts to keep him.

We’ve already broken down the Miller era to date and its ups and downs, the arguments for and against what he’s done. Now we’ll try to look at the whole of the decision facing Dolson and the two key factors outside of his simple evaluation of Miller.

The Buyout

There’s a good chance Indiana wouldn’t end up having to pay Miller everything his contract says it would owe him. Its obligation would be mitigated by the compensation Miller would earn in any “comparable employment position” which would not only include any head or assistant coaching position in professional or college basketball, but any “athletics-related media position,” any “professional or administrative position with an athletics related governing body” or “another similar athletics-related position.”

So what that means is that if Miller works in sports, unless he makes a huge U-turn and decides to coach high school basketball like his father did for so many years, Indiana will owe a smaller obligation. Miller is just 42 years old, so it’s hard to imagine that he’d be willing to go a full three years without coaching or at least working in sports somewhere just to make sure he squeezes every dime out of IU. And the buyout goes out in monthly payments, so it’s not like the Hoosiers have to pay it out in a lump sum and just hope Miller pays it back if and when he gets another job.

But still, it would be irresponsible for Dolson not to plan as if he would owe every penny. And that’s a lot of pennies.

Each year, Miller is owed $550,000 is base salary and $1 million in deferred compensation.  More than half of his total compensation comes from outside marketing and promotional income and that number goes up every year. He ‘s making $1.8 million from April 1, 2020 to March 31, 2021. From April 1, 2021 to March 31, 2022, that number goes up to $1.85 million. The following year it’s $1.9 million. Then. $1.95 million for the last year on his contract.

The buyout says that if he’s let go before March 31, 2022, he’s owed 100 percent of what’s left on the deal. So for the final three seasons, that’s $4.65 million in base salary and deferred compensation, $5.7 million in outside marketing and promotional income — a total of $10.35 million dollars.

And waiting makes a big difference because from April 1, 2022 on, he’s only owed 50 percent of what’s remaining. which at that point would be $3,475,000.

Of course, it’s not as simple as saving $6,875,000. Keeping Miller for one more season and then letting him go means paying him $3.4 million next year and then the $3,475,000 buyout which is still $6,875,000. But if the Hoosiers let him go, they also have to pony up for a new coach and probably pay him more than they are paying Miller. If they go big and pay $5 million a year, which would still put the Hoosiers behind Kentucky (John Calipari), Duke (Mike Kryzyzewski) and Villanova (Jay Wright) for head coach compensation, they’d be spending $8.5 million in head coaching contracts next season for one sport.

In an ordinary year, the Hoosiers might be able to handle that without going too deep in the red. Though much of it went to debt service, Indiana turned a $13 million surplus with $127.8 million in total revenue in Fiscal Year 2019.

But this isn’t an ordinary year, as the pandemic forced college athletics to play its games without crowds and therefore without gate revenue. The Hoosiers made $18.4 million in ticket sales in Fiscal Year 2019, and that’s effectively zeroed out this year. There’s additional loss in concessions, parking, apparel sales, etc., that comes from fans not being at games and there could also be a decrease in donations. It’s impossible to say what the total loss will be at this point, but Dolson recorded a video in October asking for donations saying that IU was bracing for a budget shortfall of as much as $60 million.

Indiana has managed to get by so far with media rights money and hasn’t had to cut sports or undergo major layoffs, but other schools haven’t been so lucky. That makes it bad optics to pay a coach so much money to go away when so many people, not just in college athletics but nationwide, have lost their jobs because of the coronavirus.

If the Hoosiers chose to ask donors for the bailout money, they could probably get it that way. Donors with that kind of wealth haven’t been hit as hard over the past year as they were by the 2008 market crash, for instance. But beyond the optical issues, Dolson would have to presume that whoever would be willing to give that kind of money would expect a return on investment, up to and including a say in who the next coach is. If Dolson decides to make a move, depending on where the money comes from he could find himself out of control of his own coaching search.

Fan Apathy

As noted above, Indiana fans are annoyed, bothered, and to some extent angry, and these feelings have only been increasing over time.

It’s been 34 years since the last national title, 19 years since the last national title game appearance, Final Four or Elite Eight. Tom Crean took the Hoosiers to three Sweet 16s and a pair of Big Ten titles, but that’s the closest thing to sustained success that they’ve had since the Bob Knight era. IU fans have seen their program slip from the ranks of the blue bloods, and it’s going to especially sting over the next month when the entire college basketball world comes to Indiana and the state’s flagship institution isn’t part of the event.

There is a portion of the fan base that has given up, that has seen the Hoosiers disappoint them so many times that it doesn’t bother to put games on anymore, much less attend games in person. After the Hoosiers’ showing over the last six games of the season, that portion will be hard to earn back next season if Indiana doesn’t make a change.

It’s hard to say what that could cost the Hoosiers in dollars in cents at this point, but there will be a cost and it will be tangible. That’s mitigated significantly by the fact that Indiana basketball season tickets are something of a legacy item in the state, something that gets passed along by families through generations and that people don’t relinquish easily because of a few bad seasons. That means IU can count on a relatively steady stream of income through gate receipts and even if the fans are angry Assembly Hall isn’t going to be completely empty. But there’s an optical cost if the seats that are bought and paid for are unfilled and there’s an actual cost in terms of concessions and parking. Plus, donors are more likely to donate, on a widespread basis, to a n  If Dolson decides the buyout is worth it, that’s his return on investment.

The Next Coach

The reason Miller got a seven-year contract in the first place was because Fred Glass was trying to send a message. After the Hoosiers had gone through four coaches (if you count interim coach Dan Dakich) since Bobby Knight’s firing in 2000, he wanted to show that Indiana was invested in stability as a governing principle. Indiana would have high expectations, but it would also put trust in its coaches and give them whatever time was necessary to succeed.

Glass didn’t think this would be a problem for his successor. He said at the time he expected Miller to be a coach who could create a 20-year era of success at Indiana. In his mind, there was no reason to worry if they had given Miller a contract that was too long because in the not too distant future, the Hoosiers would be looking to extend it anyway.

Getting rid of Miller in four years would obviously make this seem dishonest. That idea might be easier to shake if Dolson hadn’t been Glass’ deputy before taking over as it’s generally presumed he was of the same philosophy.

That, of course, matters to coaches. Anyone who would be interested in the job after Miller would want to know that the administration wouldn’t be jumping to make a change as soon as the message boards started to complain about an unexpected loss in his first year. Coaches care about support from their athletic departments and want to go in to any job certain that their bosses will have their backs when things get tough.

That being said, when coaches are on a negative trajectory four years into their tenure once their first full recruiting class has had a chance to age and mature, they’re generally in trouble regardless of where they are. Coaches that are confident in their ability to institute a successful rebuild don’t go into it presuming they’ll fail.

That said, the quick trigger could shrink Indiana’s field. The fact that the Hoosiers have gone so long without Final Four level success suggests that the job isn’t the premier position it once was, and it gets harder to convince someone to come without a guarantee of job security.

All it takes is the right coach to decide the job is worth the risk. If the next coach wins and does so relatively quickly, it won’t much matter if the Hoosiers didn’t have a huge pool of candidates and the buyout won’t matter much at that point either. But both will sting a lot more if the Hoosiers guess wrong again.

Which ultimately gets to the heart of the matter. Whatever decision Dolson makes will be proven right or wrong by the next coach. If he fires Miller now and gets a coach who ultimately takes Indiana to Big Ten titles and Final Fours, he will look smart for being proactive. If he doesn’t, it will be a bad hire compounded by wasted money. If Miller revives the program while on the hot seat in 2021-22 — as Shaka Smart did at Texas and Josh Pastner did at Georgia Tech this year — or the Hoosiers make a great hire next year that they couldn’t have made this year, Dolson will look wise in retrospect for being prudent.

The returns will be immediate if the hire is viewed as a sure thing, if it seems to shift college basketball’s tectonic plates on a national level. In the highly unlikely event that Dolson lands the great white whale that is Brad Stevens, the narrative will change entirely on a dime. Even if he manages to convince John Beilein to get back into coaching, that will get back him back into IU fans’ good graces fairly instantaneously. In the case of most other conceivable hires, fans will probably have to see results first – after all, Miller looked really good on paper too — but if the wins come, the decision will look wise whenever it’s made. If they don’t, the program will only look worse.

That suggests that Dolson would increase his chance of success by finding out who Miller’s successor would be before he makes a decision on whether or not to retain the current coach. However, that’s not an easy line to walk, as he has to be able to find out answers while maintaining plausible deniability that he’s asking the questions, as he would otherwise undermine Miller and possibly turn off prospective hires at the same time.

All of this gets back to the initial point. Most ADs wouldn’t want to trade places with Scott Dolson on this matter. Getting it right doesn’t just mean making a yes or no decision on Miller, it means figuring out the next possible steps without being able to do so directly or publicly. The range of outcomes is wide and the stakes couldn’t be much higher. Another year of a basketball program stuck in traction would be bad, but another four or five after that would be worse because with every passing year it gets more difficult to convince coaches, recruits and fans that Indiana is the powerhouse it once was.

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