FAU’s total compensation package for football coach Lane Kiffin includes a previously unreported $2 million loan that he won’t need to repay should Kiffin remain at Florida Atlantic through 2021.
That loan is in addition to the five year, $4.75 million contract Kiffin signed in December of 2016 to become the fifth coach in program history.
“The intent was, let’s put a package together that Lane’s happy with and he’s comfortable with and something that we can afford,” FAU president Dr. John Kelly said. “We obviously can’t pay what some larger schools can pay. But if we’re creative we can come up with a strategy that makes him happy, gives him what he needs to be successful and also, hopefully, helps us retain him for a longer period of time.”
The loan promissory note, which OwlAccess.com obtained via a public records request initially submitted in October of 2017, stipulates that the purpose of the loan is to allow Kiffin to purchase a home within 25 miles of campus.
Palm Beach County records show that Kiffin paid $2.1 million for a house in northeast Boca Raton in May of 2017.
“I really didn’t do anything except agree to whatever it took to make sure we got him,” Kelly said.
FAU forgives 20 percent of the original loan amount for each year that Kiffin remains the Owls’ coach, a decrease of $400,000 per year.
Having already coached one season, Kiffin would have to repay the university $1.6 million plus interest should he elect to leave prior Dec. 1. With the forgiveness of the $400,000, Kiffin’s actual compensation for last season came to $1.35 million prior to bonuses he received for winning the Conference USA championship and the Boca Raton Bowl.
Kiffin reportedly made $1.4 million in 2016 as Alabama’s offensive coordinator before accepting the job at FAU.
If the loan forgiveness is included as part of his base compensation, Kiffin moves to the top of Conference USA’s highest-paid coaches list, surpassing North Texas’ Seth Littrell ($991,416) and UTSA’s Frank Wilson ($1,137,500), according to USA Today’s annual survey of college football coaches salaries.
“He’s obviously performing at the highest levels,” Kelly said. “He’s performing like a Top 25 coach would perform, regardless of which conference you’re in.”
Public universities providing loans to their football coaches isn’t unprecedented. In 2006 Rutgers reportedly sold Greg Schiano a parcel of land, then lent him $800,000 to build a house on the property. Rutgers forgave $100,000 of the loan for each year Schiano remained the Scarlet Knights’ coach.
In 2016, Michigan agreed to loan Jim Harbaugh a total of $14 million over six years to cover the premium of a life insurance policy. As part of the deferred compensation package, Harbaugh can borrow against the policy but doesn’t have to repay the loan until after death. South Carolina also used life insurance loans to compensate women’s basketball coach Dawn Staley.
Even excluding the loan, Kiffin was already the highest paid coach in FAU football history. If Kiffin is able to build on his first season he may actually be a bargain, even at the increased rate.
Kiffin took over a team that went 3-9 during the three prior seasons and turned the Owls into an 11-3 juggernaut that blasted its way to an undefeated run through Conference USA play en route to Florida Atlantic’s first C-USA championship.
FAU ended the season with a 10-game winning streak, the second-longest current streak nationally, and Sports Illustrated placed the Owls at No. 25 in its 2018 preseason rankings.
Kelly said one of the questions he asked Kiffin while interviewing him for the then-vacant FAU coaching position was: Can you take us to the Top 25?
“He did it in one year,” Kelly said. “I didn’t know he could do that.”
Kiffin’s personality, often in the form of tweets, also kept FAU in the national sports conversation even after the football season ended.
Following last season’s record-breaking campaign, many prognosticated that Kiffin would leave Boca Raton for a higher profile program. Several coaching vacancies opened following the 2017 season, but no credible reports linked Kiffin to any of the jobs.
Kiffin frequently articulates how much he enjoys living in Boca Raton and coaching at FAU, and over the summer he signed a contract extension that would make him the Owls coach through 2027. The extension did not include an increase to Kiffin’s base salary, nor did it change Kiffin’s buyout from the original contract should he decide to leave.
His initial contract called for a $2.5 million buyout that decreases by $500,000 for each year that Kiffin remains at FAU.
If Kiffin elects to leave for another job prior to the entirety loan being forgiven, it is likely that the school which hires him away from FAU will cover the amount remaining on the loan, as is commonly done with buyout clauses.
Including the loan in the equation, had Kiffin left FAU after last season he, or the school hiring him, would have have owed FAU $3.6 million. If Kiffin were to elect to leave after the 2018 season, something he hasn’t indicated he’s interested in doing, the buyout drops to $2.7 million. By 2020, the final year in which Kiffin, or the hiring school, would have to pay a buyout, the overall cost drops to $900,000.
FAU begins its season on Sept. 1 at Oklahoma.