College football has gotten expensive. For a sport heavy with grand spectacle, few think of the numbers game being played behind the screens. Many programs are in debt. Illinois had to give around $20 million in facility debt service. That’s 11.8% of its total expenditures for ’23–24. Even Ohio State listed $33.7 million in debt service. This constituted 11.5% of the budget outlay. Football programs are facing the financial crunch. But the Big Ten has an ace up its sleeve. A multi-billion dollar investment opportunity that will make all of these problems disappear. But it comes at a cost that Michigan is not willing to pay.

The Big 10 proposed a $2.4 billion private investment plan from UC Investments. They are the University of California pension system’s investment fund. In return, the conference will create a separate entity, Big Ten Enterprises, which would house the league’s television rights and sponsorship deals. The fund will get a 10% stake. The league’s grant of rights will also be extended until 2046.

Michigan has signaled heavy reluctance to agree to the proposal. The program mainly opposes the grant of rights structure, extending for a whopping 20 years. Not just that, Michigan regent Jordan Acker called the proposal “unnecessary,” calling it a way to “borrow your way out of a spending problem.” In his speech, Acker also outlined how the deal could come back to haunt them five years from now.

“Enough is enough. You can’t borrow your way out of a spending problem and until these soaring expenses are addressed, throwing short term problems is akin to opening another credit card,” said Acker. In a five-minute speech, Acker expressed concerns about the new capital proposal. For the past 15 months, according to reports, Big 10’s commissioner Tony Petitti has worked hard to get this deal in place. Every team will get a an instant share of the money. There is also a promise of immediate cash in case of future emergencies.

Petitti rejected Acker’s characterization of the private equity deal and coined it as a partnership with a not-for-profit entity. The proposal to give away a 10% stake of the Big 10 and uneven revenue distribution has become a bone of contention.

Michigan isn’t alone, as USC has joined the fold. Without both programs approving the proposal, it’s improbable that it will come to fruition, as it requires a unanimous vote. However, USC’s decision to oppose the deal stems from the uneven distribution that the agreement proposes.

In the 200-plus-page governance document, Tony Petitti’s camp immediately outlined a guaranteed close to $200 million to Ohio State, Penn State, and Michigan. Allegedly, other schools like Oregon and USC will earn about $50 million less. USC argues that it places the program in a different tier than Penn State and Ohio State, and even expressed concerns about governance issues, where a board will run the business with weighted voting. Apart from Michigan and USC, Ohio State also initially opposed the deal.

Ohio State’s $2.4 billion U-turn

Ohio State was also wary of selling a stake in the conference. The program argued that the move would mean the “commercialization” of public university assets privately. That also could face backlash in the state, where college football reigns supreme.

It was reported at the beginning of October. “Ohio State and Michigan are, for a variety of reasons, pushing back against the proposal that Big Ten commissioner Tony Petitti has been socializing since the spring,” reported Ross Dellenger. However, it seems Ohio State has finally agreed to the deal, since only USC and Michigan’s opposition remains.

“Since a story was published Tuesday by Yahoo Sports about USC and Michigan’s issues, officials from the 16 supporting schools — most notably Ohio State — have reached out to those at UM and USC in an effort to encourage them to support the measure,” reported Ross Dellenger. It surely raises some questions as to why Ohio State finally agreed. So much so that they are even trying to encourage the two opposing teams in USC and Michigan. For now, though, at least Michigan’s vocal opposition remains strong.

“We can do this more efficiently than selling assets… We understand the responsibility to lift all boats and to help schools that need money to get that money… it just has to be on the best financial terms possible… The Big Ten does not need to be sold to save college sports. It needs to lead to saving college sports,” said Jordan Acker to the Big 10’s private equity plan.

Despite the two programs’ opposition, the other 16 programs are trying to welcome the two into the fold. But if that doesn’t happen, plans are in place reportedly to go ahead with the deal without USC or Michigan. However, it remains to be seen how that will play out.