- Joined
- May 8, 2002
- Posts
- 1,170,502
- Reaction score
- 59
The House Committee on Education and Workforce has asked the University of Utah to schedule a briefing to discuss the school’s plans to take money from a New York-based private equity firm.
The committee, which has jurisdiction over federal education policy, is examining the growing trend of schools seeking institutional partners to capitalize their athletic departments. The group is assessing whether legislative action might be needed to address concerns about the downstream impact of these deals.
More from Sportico.com
In a letter sent to Utah president Taylor Randall on Monday morning, a copy of which was viewed by Sportico, the committee requested that the school share information regarding the details and motives behind its potential partnership with Otro Capital, which its trustees greenlit in December.
“While recognizing the escalating costs in collegiate athletics, including revenue share obligations under the House v. NCAAsettlement, NIL-related expenses and coaching salaries, the committee seeks to better understand the university’s rationale for entering into this arrangement,” committee chair Tim Walberg (R—Mich.) and Burgess Owens (R—Utah), a former NFL and University of Miami player and chairman of the subcommittee on Higher Education Workforce Development, wrote in the letter. “The information and briefing requested will assist the committee in determining whether legislative action may be necessary to protect students, schools and the integrity of college athletics.”
As conversations between schools and institutional funds have grown more public, so too have concerns from lawmakers. Last month, on the verge of the College Football Playoff title game, Reps. Michael Baumgartner (R—Wash.) and Haley Stevens (D—Mich.) wrote a letter to NCAA president Charlie Baker asking him to limit the emergence of PE deals that “threaten the integrity of university governance and the quality of college sports in ways that will have disastrous consequences for athletes, students and fans.”
Local state-level lawmakers in both Utah and Washington have proposed bills that would also make it harder to execute these deals.
The House Committee on Education and Workforce’s letter to Randall requests that the university share terms of the arrangement and answer three specific questions:
Representatives for Utah and its athletic department didn’t immediately respond to requests for comment.
The University of Utah trustees voted during their December meeting to allow Randall, athletic department Mark Harlan and others to finalize a deal with Otro. While it’s unclear if that final arrangement has been signed, the structure of the deal was openly discussed. Utah is spinning the Utes’ athletics revenue streams into a for-profit entity, and plans to sell an equity stake in that business.
Randall played a prominent part in the formal 110-minute pitch to the trustees, helping explain the macro reasons why Utah is seeking the money, and why Otro Capital was the right partner.
Financial specifics, however, have been sparse. The school has declined to share details on a deal that likely tops nine figures. A Sportico open records request for any term sheet between the school and Otro, filed back in September, is yet to be fulfilled following multiple university extensions.
Utah is not alone in seeking institutional money to adapt to the modern economics of college sports. The Big Ten, for example, was recently on the verge of a $2.4 billion partnership with a California pension fund, but those talks are now on hold after pushback from some conference members about the 20-year revenue share commitment that came with the deal.
The Big 12 is in advanced talks on a potential $500 million deal with Collegiate Athletic Solutions (CAS), a fund backed by RedBird Capital and Weatherford Capital, that would let schools take upfront money in exchange for revenue sharing on the back end. That deal, unlike the proposals involving Utah and the Big Ten, does not involve any equity changing hands.
Separately, a number of other schools, such as Kentucky and Clemson, have created similar separate commercial entities, but they are yet to take outside institutional investment. Those deals are widely considered necessary step for public schools to take on institutional money for athletics.
The House Committee on Education and Workforce, which dates back to 1867, has 21 majority members, and 16 minority members. Under House Rule X, the committee is tasked with reviewing and coordinating “laws, programs and government activities relating to domestic educational programs and institutions and programs of student assistance within the jurisdiction of other committees.”
Best of Sportico.com
Sign up for Sportico's Newsletter. For the latest news, follow us on Facebook, Twitter, and Instagram.
Continue reading...
The committee, which has jurisdiction over federal education policy, is examining the growing trend of schools seeking institutional partners to capitalize their athletic departments. The group is assessing whether legislative action might be needed to address concerns about the downstream impact of these deals.
More from Sportico.com
- Colorado's Dempsey Goes From House Objector to China Scholar
- Sports Tech Mergers Double in Value in 'Landmark Year'
- College Recruiting Costs Shrink as Football Powers Adapt to Portal
In a letter sent to Utah president Taylor Randall on Monday morning, a copy of which was viewed by Sportico, the committee requested that the school share information regarding the details and motives behind its potential partnership with Otro Capital, which its trustees greenlit in December.
“While recognizing the escalating costs in collegiate athletics, including revenue share obligations under the House v. NCAAsettlement, NIL-related expenses and coaching salaries, the committee seeks to better understand the university’s rationale for entering into this arrangement,” committee chair Tim Walberg (R—Mich.) and Burgess Owens (R—Utah), a former NFL and University of Miami player and chairman of the subcommittee on Higher Education Workforce Development, wrote in the letter. “The information and briefing requested will assist the committee in determining whether legislative action may be necessary to protect students, schools and the integrity of college athletics.”
As conversations between schools and institutional funds have grown more public, so too have concerns from lawmakers. Last month, on the verge of the College Football Playoff title game, Reps. Michael Baumgartner (R—Wash.) and Haley Stevens (D—Mich.) wrote a letter to NCAA president Charlie Baker asking him to limit the emergence of PE deals that “threaten the integrity of university governance and the quality of college sports in ways that will have disastrous consequences for athletes, students and fans.”
Local state-level lawmakers in both Utah and Washington have proposed bills that would also make it harder to execute these deals.
The House Committee on Education and Workforce’s letter to Randall requests that the university share terms of the arrangement and answer three specific questions:
- What factors and considerations led the university to pursue this partnership, and why was this approach selected over other potential financing options?
- What steps is the university taking to maintain institutional control and to protect student-athlete welfare, including compliance with Title IX under this partnership structure?
- How might this partnership affect student costs, particularly with respect to mandatory student fees that subsidize the athletic department, and are any changes to the fee structure anticipated following implementation?
Representatives for Utah and its athletic department didn’t immediately respond to requests for comment.
You must be registered for see images attach
The University of Utah trustees voted during their December meeting to allow Randall, athletic department Mark Harlan and others to finalize a deal with Otro. While it’s unclear if that final arrangement has been signed, the structure of the deal was openly discussed. Utah is spinning the Utes’ athletics revenue streams into a for-profit entity, and plans to sell an equity stake in that business.
Randall played a prominent part in the formal 110-minute pitch to the trustees, helping explain the macro reasons why Utah is seeking the money, and why Otro Capital was the right partner.
Financial specifics, however, have been sparse. The school has declined to share details on a deal that likely tops nine figures. A Sportico open records request for any term sheet between the school and Otro, filed back in September, is yet to be fulfilled following multiple university extensions.
Utah is not alone in seeking institutional money to adapt to the modern economics of college sports. The Big Ten, for example, was recently on the verge of a $2.4 billion partnership with a California pension fund, but those talks are now on hold after pushback from some conference members about the 20-year revenue share commitment that came with the deal.
The Big 12 is in advanced talks on a potential $500 million deal with Collegiate Athletic Solutions (CAS), a fund backed by RedBird Capital and Weatherford Capital, that would let schools take upfront money in exchange for revenue sharing on the back end. That deal, unlike the proposals involving Utah and the Big Ten, does not involve any equity changing hands.
Separately, a number of other schools, such as Kentucky and Clemson, have created similar separate commercial entities, but they are yet to take outside institutional investment. Those deals are widely considered necessary step for public schools to take on institutional money for athletics.
The House Committee on Education and Workforce, which dates back to 1867, has 21 majority members, and 16 minority members. Under House Rule X, the committee is tasked with reviewing and coordinating “laws, programs and government activities relating to domestic educational programs and institutions and programs of student assistance within the jurisdiction of other committees.”
Best of Sportico.com
- Tennis Prize Money Tracker: Which Player Has Earned the Most in 2025?
- Formula 1 Team Value 2025 Rankings
- Everything to Know About the 2025 Emirates NBA Cup
Sign up for Sportico's Newsletter. For the latest news, follow us on Facebook, Twitter, and Instagram.
Continue reading...
