Pension Crisis

Coach Nick Saban Could Get a Huge Pension, Courtesy of Alabama Taxpayers

America's highest paid public employee might win another college football national title, but he's also a good argument for pension reform.



Correction: This post originally stated that University of Alabama head football coach Nick Saban was eligible for a $2.4 million annual pension, based on analysis from Open The Books that was erroneous. Under a 1996 state law, pensionable income for Alabama state workers is capped at $270,000 and income in excess of that amount does not factor into pensions.

University of Alabama head football coach Nick Saban is America's highest paid public employee, pulling down a cool $11 million from the publicly funded college this year.

On its own, that fact is probably not too surprising. College football coaches are the highest paid public employees in most states, and Saban is the best college football coach in the country. When his Crimson Tide take the field on Saturday in one of the national semifinal games, he will be two wins away from a second consecutive national championship (and a sixth in just 12 seasons at Alabama).

Yes, $11.25 million is a heck of a lot of money for a public employee, especially since Alabama's football program is $225 million in debt. In the fundamentally corrupt world of college sports, however, Saban is at least a winner.

But what about when he retires? Long after the glory of Saban's national championships fade, it turns out, the taxpayers of Alabama will continue to pay for his pension. That's according to Adam Andrzejewski, founder and CEO of Open The Books, a nonprofit that claims to have the largest database of state and federal spending records. In an article for Forbes, Andrzejewski notes that Saban qualifies for a maximum pension under the state's 1996 law that caps pensionable income at $270,000. The specific pension for Saban would depend on his years of service before retirement.

That large sum reveals one of the major flaws with the so-called "defined benefit" structure used by most public pension systems. Under a defined benefit plan, an employee is guaranteed an annual pension that's based on an employee's years of service, final salary (or, as is common, an average of the employee's salary during his or her last three or five years on the job), and a multiplier that's a special bonus for employees with special status (cops will generally have a higher multiplier than desk clerks in the Department of Motor Vehicles, for example).

Plug in the numbers, do the math, and the pension amount is set. An investment portfolio's earnings don't matter, and neither does the state's contributions to the pension plan. This largely why some states have fallen so far behind in their pension obligations: because the benefits keep accumulating even though they aren't being adequately funded.

One of the problems with a defined benefit system is that, for employees at the very top of the earnings scale, the pension plan becomes a massive transfer of wealth rather than a retirement safety net. It's certainly not in the best interest of Alabama taxpayers to continue funding Saban's post-retirement life. And with a state pension system that's already more than $16 billion in the red, it's also not in the best interest of Saban's fellow government pensioners.

But Alabama's decision to cap pension income was a wise one that may have prevented the state from falling farther behind while financing generous retirement packages. As I've previously covered, California has more than 62,000 retirees getting six-figure salaries and seven retirees getting $1 million annually—led by Earl Paysinger, a former deputy police chief in Los Angeles.

Defenders of traditional, defined-benefit pension systems will often argue that the average pension is far less than what these outliers receive. That's true, of course, but the outliers are still a problem, even if they're a lesser concern than the overall structure of public pensions. As America slowly reckons with its massive pension liabilities, means-testing retirement payments for recipients with seven-figure net worths should be a no-brainer.

Put another way: Alabamans might worship Nick Saban for what he's accomplished on the gridiron, but that doesn't mean they should be forced to add to his already astounding personal wealth with their own hard-earned money.

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  1. Why would deny Saban the meager retirement that he has earned?

    1. Hell yes! Who thinks anyone can live in Alabama on such a paltry sum?

  2. Well at least Alabama is saving money by not paying the players anything.

  3. Yes, but championships! Roll Tide!

  4. Government is just the sport celebrities we decide to worship together.

  5. That is a ridiculous sum of money to pay for anyone’s retirement… If he was that well payed then he should have saved for his own retirement fund!

    1. Exactly.

  6. Alabama football probably generates more revenue than anything else in Alabama…

    1. Maybe you missed this:

      “Alabama’s football program is $225 million in debt. “

      1. I haven’t read the link but I would assume they borrowed for facilities improvements. Which is pretty typical for any business (very few would have the cash for such a large capital investment). So I hear your point but the comment in the article is probably a little misleading.

        1. Very misleading article.
          The ‘debt’ is over almost 30 years, plus the football program makes almost $50 million in profit per year, from revenue of over $110 million. So, annual profit is 5 or 6 times the annual debt payment.

          Talking about the debt without talking about the income is either extremely ignorant or deliberately deceptive.

          1. Yeah, I’m no ‘Bama fanatic, but it isn’t just “bad reporting” to pull that factoid in that context. It is deliberately deceptive. You can make the point about pension system reform without resorting to such dishonest tactics.

            Besides, the obvious cure and answer for “football coaches shouldn’t be paid so much as public employees” is to move their salary off of the public payroll, which is what most schools do.

            In fact, Saban’s total comp for the $11 million year included a $4 million signing bonus for his new contract. The real comp number is currently around $8.5 million.

            I don’t have a current source, but it used to be that a coach got most of his total comp outside of his salary. So a football coach with a $10 million comp package would actually pull down a $3 million salary and get the rest from a TV contract and endorsement deals. USA today doesn’t list it that way, if it does still exist.

      2. Yep. From the article:

        For some schools, millions in TV money can support a high level of debt service. That includes the University of Alabama, which plays Clemson for the national championship on Monday. The Crimson Tide owes $225 million over the next 28 years.

        They don’t specify the Tide’s revenue, but I assume they are in the black after figuring in debt payments.

      3. Alabama athletics brought in $174.3 million last year

        The Crimson Tide brought in $174.3 million dollars in 2017.

        Saban’s salary is a drop in the bucket.

        Boehm never does in depth reporting, so we will never get a breakdown of where any mismanaged money went.

        $225 million over 28 years is $8 million per year, which is also chump change for Alabama.

        In other words Boehm, Saban brings in far more money than he is paid unlike many in the state pension system. Furthermore Saban is a great coach that has taken his team to dominate EVERY OTHER TEAM in the USA over and over.

        SEC RULES!

    2. My company brought in 400 mil in 18 with a staff of 900.

  7. Aaron Rodgers makes 30 million a year and the Packers are a government owned entity so isn’t he America’s highest paid public employee?

    1. The Packers are owned by 360,000 private shareholders. All government ventures should be set up that way.

      1. Packers running a brilliant scam when these people actually believe they own part of the Packers.

        1. Hattori Hanzo|12.29.18 @ 8:12PM|#
          “Packers running a brilliant scam when these people actually believe they own part of the Packers.”
          Care to offer an explanation?

          1. Voting rights. Same happened with the Cleveland Indians some years ago. Following several seasons of sellouts the owner was looking for more ways to make money. Presto! Sell shares in the team! Non-voting shares. These are essentially autographed keepsakes with no value, except to collectors.

            And the suckers bought them!

            1. They are also non transferable. They literally have no value.

  8. Ugh, this is just a heartbreaking example of transphobia. As a nonbinary (they / them) person myself I know all too well the pain caused by being misgendered. Of course conservatives, being the cruel science-denying bigots they are, manage to find this situation funny:

    Transwoman reacts with justifiable frustration after being misgendered by people who don’t know basic biology.

    “Titania McGrath” by the way is a terrible “SJW parody” Twitter account. I honestly think political parody is the lowest form of comedy. (Well, except when Colbert used to do it ? that was funny.)


    1. Thanks. That was hilarious.

  9. It’s certainly not in the best interest of Alabama taxpayers to continue spending $2.4 million on Saban every year for the rest of his post-retirement life.

    Of *course* it is! Why else would Alabama legislators — who work for those taxpayers — set up this system?!

    1. Think of the value of the education the Alabama taxpayers are receiving here. Is it not in their best interest to learn their place? When Nick Saban’s treated like Number 1, the taxpayers are treated like Number 2.

      1. It’s like Nickie is taking a number 2 all over them. Roll Tide!

        1. Boehm probably has zero idea that in the South, College football is more popular than NFL.

          1. Given his evident disdain for Southerners in his author profile, I suspect he has zero real idea about anything Southerners care about. Except he’s sure it’s beneath him.

            1. What a weird statement. No one in the South (or elsewhere, probably), considers Northern Virginia to be “the South.”

              1. My statement was weird or his? Because I read his as saying the equivalent of, “I live in the South but will never consider myself a Southerner,” which is some snooty bullshit. But of course you’re correct about N. Va. today, even if it is still south of Mason-Dixon. Hell, I wonder if other Virginians even consider themselves “Southerners.” They’re Virginians, by God!

      2. +1 Golden Shower

  10. He should transfer those payments to the Dolphins as compensation.

  11. Reason barking up the wrong tree? Who saw that coming…

    This is clickbait. There are tons of pensioners out there who never earned close to the benefits they’re receiving. Then there’s Saban, who like so many top college football coaches has been proven to bring so much more revenue into his program than a replacement-level coach that he pays for himself several times over.

    Even with the pension.

    1. Saban has paid for himself so many times that he’s driven Alabama $225 million in debt.

      1. Correction, he’s made the program generate so much cash they can service 225 million in debt (due over 28 years)

      2. Saban has paid for himself so many times that he’s driven Alabama $225 million in debt.

        Fished in!!

        you got caught by the stupid debt ploy. If you buy a new stadium or build a big indoor practice facility, generally you don’t pay cash up front. Kinda like buying a new house or maybe a business building a new factory. Big-time athletic programs like Alabama have annual budgets in the $100 million plus neighborhood. At most schools, this is mostly funded by the football program – Alabama being no exception.

        Picking Saban as the stalking horse for the pension problem is just dumb. His value over comp is too easily demonstrated. Even big-time CEO comp isn’t as directly tied to results.

    2. Mr. JD|12.29.18 @ 6:18PM|#
      “Then there’s Saban, who like so many top college football coaches has been proven to bring so much more revenue into his program than a replacement-level coach that he pays for himself several times over.”

      You made the claim; prove it.
      Unlike asshole Hugh, you do not need to gift-wrap the cites to satisfy the requirement for me, just prove it.

      1. That’s easily true.

        Saban is on a very short list of elite coaches who can create a program that wins at all levels (and therefore draws sellout crowds, booster donations and prestige to the university).

        If Saban was 50 instead of 70, how much do you think Texas would offer him to move, right now? Or Tennessee? Or Ohio State?

        Even at places with huge fanbases like Michigan or Tennessee, a winning coach makes a huge difference in attendance. Literally tens of millions of dollars, just in tickets and concessions are at stake even at such traditional powers. Then you have the tier two or three football programs, where attendance might triple or quadruple with even a good head coach – look at a place like UCF. The entire athletics program is transformed by a top level coach elevating the program. After going undefeated last year, they set new records fundraising. The pull quote from their chief fundraiser: “”I think people just naturally want to be a part of a winning organization; something that’s successfully moving forward. So that helps a lot.”

    3. So he paid for himself how many times over? Since your stating, that his salary isn’t enough for how much in brought in (Which is debatable since Alab is in 228 million in debt).

      So I as a taxpayer, what have I received? Are the students smarter? So you he brought in money for entertainment. Should I have to pay that for 20 more years? So say he gets 20 years of pension. So is in 48 million worth it?

      The point moron is that he shouldn’t be on the taxpayer’s dime. If the school wants to pay with it’s endowment or money from the football program which the next coach brings in – fine. But why should the taxpayers?

      1. When Saban took over the Alabama football program in 2007, the program brought in about $45 million in revenue.
        In 2017, the Alabama football program made $46 million in profit, off of $110 million revenue.

        For comparison, that’s more than any of the 30 NHL teams, and more than 25 of the 30 NBA teams (2016).
        A 2015 breakdown is here

        It is possible to say that Saban coaching the team to so many top-rank bowls and national titles had nothing to do with the $60 million increase in per-year revenue for the football team. However, that would be a very extraordinary claim, and would need some very convincing evidence.

        1. Boehm never learns to provide articles with in depth information.

          Its how he fits in with the other Propagandists that work at Reason.

        2. Pish posh, dear fellow. You don’t expect the ideological warriors of the free market to actually understand how such base and ignoble subjects like finance work, do you?

  12. But Sabin and Alabama had a contract that defined his pension. While Alabama might think about the agreement for their next coach, they must honor their contract, unless Sabin agrees to nodify it.

    1. Not really. Contracts involving stolen cash are null and void.

      1. Clever, but factually incorrect, unless you’re saying that all contracts are void if one party later regrets it. Not very libertarian of you.

  13. Probably the only thing the chattering classes, brown people, and deplorables in Alabama can agree on is football and the need to throw money at it.

  14. Nick Saban is a saint! A MF saint, sent by God to bless Alabama with the football championships it deserves. How dare you disrespect his name with your blasphemous worries about “money” and “pensions.” Maybe you should mind your own business while Mr. Saban takes care of Alabama football. You don’t know what you’re talking about.

    Roll Tide!

  15. This is BS. Let me start by saying I’m an Auburn alum and I hope Saban dies in a fiery car wreck. That said, Saban’s base salary (i.e. the taxpayer-funded portion) is around $250K/year. The rest is funded through bammer’s booster org through private donations, endorsement deals, media rights, etc. His retirement is likely based only on the base salary. Also, his benefit is calculated based on his years of service. You are fully vested (to receive lifetime benefits) once you hit the 10 year mark and reach age 60. You can start receiving this benefit with 25 years of service (which hopefully will not apply to Saban) at any age if you are a qualifying member who started in the system prior to 2013. The State’s Retirement System (RSA) is well managed and one of the perks that keeps quality employees in public service positions that are generally underpaid and poorly funded. Also if you don’t think the investment made in Saban hasn’t more than been recouped you are a Ftard. Lastly F Saban and go to hell bammer.

    1. Shut your mouth. You shut your goddamn mouth about Rick Saban.

    2. War eagle!

    3. Wrong. Public employee’s paychecks are public knowledge – select “Payroll” and “Saban” and start/end dates and up pops the checks.

      The University of Alabama pays Saban’s multi-million dollar salary, the booster club boosts his pay. Like buying his home and letting him live there for free, paying him speaking fees and honorariums, buying him gifts of cars and so on.

      The booster club’s main function is the same as every college and high-school booster club’s, they pay the players not the coaches. Oh, sure, technically they don’t pay the players – but look up some player biographies and you’ll note little Johnny Singleparent was born and raised in Smallville but attended high school in Capitol City. Wanna know why and how Johnny’s momma moved him to Capitol City so he could play for a big-league high school football team? Friendly boosters helped her find a surprisingly well-paid job and a surprisingly affordable house and a surprisingly cheap car so she could afford the move. Johnny’s momma can now afford to support Johnny in the style he’d like to become accustomed to.

    4. 52-21 MF’er.

      Roll Damn Tide.

  16. The idea of eliminating big ticket college sports has been floated for years. I like college sports but there is a point.

    The atheletes do not get paid and few get an education. Since when is it the business of universities to function as training camps for the NBA and NFL? Some bring in money but it is entertainment, not education.

    Of course Hell No because we like it right?

    1. Since when is it the business of universities to function as training camps for the NBA and NFL? Some bring in money but it is entertainment, not education.

      I see the argument all the time over whether or not college sports programs pay for themselves – like right here in this very thread – when whether or not Saban is “worth” the cost is utterly beside the point. Government has no more business funding profitable businesses than it does unprofitable ones. It’s as retarded as arguing over the auto company bailouts based on whether or not the government got their money back – the government’s not a fucking bank distributing commercial loans as the lender of last resort. Whether or not Saban turns a profit for the entertainment arm of a government enterprise that has no remit to be providing entertainment is equally beside the point.

      1. I think that is all valid. We won’t see it happen because it is a cultural norm from middle school on.

      2. Take away college sports and what the ?@#$ are we going to do to amuse ourselves?
        Bread and circus! Bread and circus!

        1. Uh, all the things you do Sunday through Friday?

          And does beer count as bread?

          1. Beer counts as bread that creates it’s own circus.

    2. What with the Progressive/Left idiocy taught by most colleges these days, we would be better off disbanding the colleges and keeping the sports teams.

  17. I think that Forbes (the source material for this article) got it wrong. Most bigtime college football coaches are only paid a couple hundred grand by the actual university where they coach. The rest is paid out through endorsements, private donations via booster organizations, etc. I may be wrong, but I don’t think Saban or any other state university coach is paid a pension based on anything more than the base salary, which I think in Saban’s case is around $250k

    1. Google harder. The pension take of former football coaches is old news

  18. Oklahoma is just sad.

    1. Better than Notre Dame…
      UGA is one of the best 3 teams in the country.
      Sad we were all denied a rematch

    2. Bama got two tremendous breaks on those replays that were wrongly decided. Spoiled an otherwise great game.

      And Saban was verbally abusing his players – even the QB – that may come back to haunt him. See Knight, Robert Montgomery.

      Saban and Belichek May be the two greatest coaches ever. Imagine if they worked together….

      Oh, wait, they coached the 91-94 Cleveland Browns to a 31-33 record.

  19. College sports should be restricted to intramural . . . more students would get more exercise and academic standards would be higher.

    1. Also the NFL could be paying teen agers who are wasting their time in high school millions.

      1. Yep, past time for NFL and NBA farm teams (not connected to higher ed).

    2. College football players do get scholarships which are worth “x” amount.

      But yeah, colleges make tens of millions off young adults in college who dont get paid shit.

  20. I essentially started three weeks past and that i makes $385 benefit $135 to $a hundred and fifty consistently simply by working at the internet from domestic. I made ina long term! “a great deal obliged to you for giving American explicit this remarkable opportunity to earn more money from domestic. This in addition coins has adjusted my lifestyles in such quite a few manners by which, supply you!”. go to this website online domestic media tech tab for extra element thank you .

  21. “Higher education” has become the biggest legal scam in America.. Working families have to pay exorbitant tuition in order to pay jerks like this obscene amounts of money to win football games. It’s absolutely disgusting, frankly.

  22. Coaches are unique among public employees in that what they do and how well they do it gets measured in a very public and mostly indisputable fashion. Who can really tell how good an academic is short of the very few who will win Nobel Prizes?

    Politicians get measured by elections, but a lot of factors muddle up that such as the zeal of special interests involved, the timing of biased reporting and investigations (or the abrupt, premature concluding of inquiries), even the influence of foreign “meddling” however that might be accomplished.

    Most people’s reputations are 30% accomplishment and 70% self-promotion and sheer luck. Gen. Douglas MacArthur a sterling example.

    Football coaches have to put teams on the field that win. Belichek and Saban together couldn’t do that at Cleveland because constructing a winning program takes a lot more than X’s and O’s on a chalk board and Cleveland wasn’t the petrie dish in which to incubate winning football when they were there. Both men learned to select a better environment for success to happen.

    1. I would take MacArthur’s performance in postwar Japan over Versailles Treaty performance in postwar Germany any century. And yes, he was probable 30% do / 70% pose there too. I hear echoes of Oskar Schindler’s line about “presentation”.

    2. True.
      People get excised about the salary of a coach. But it is raw economic law of supply and demand. The pool of candidates that can coach at that level is very small. That makes the salaries very large. Coaching in general, at any level has a small pool of talent. I’ve seen highschool programs that were bottom dwellers for decades, turn around in three years with the right coach.
      At IOWA we were pathetic after Forrest Evischesky retired, until 30 years later when a nobody coach from Odesa TX showed up…Hayden Fry… winning started immediately. He never whined about have to wait to get his own recruites

  23. Well, it’s Alabama, and it’s football. I’m surprised it’s only $2.4 million.

    Maybe in retirement, Nick Saban can run for Congress, like Tom Osborne did in Nebraska. Can you say Senator Saban? You’d have to be one of those dirty Clemson fans NOT to vote for Saban.

    Related: How the NCAA is all a big fraud. A little dated, but still relevant.

    1. I don’t know about Sabin, here at Iowa the FB coach contributes to the Childrens Hospital(home of THE WAVE) in $million chunks, and I know people at the university that say he donates to lots of programs at the University on the condition of anonymity. I think is salary that is tax payer funded is less than half of his take home. Supporters kick in the rest.

  24. wish more writers of this sort of substance would take the time you did to look into and compose so well.

  25. Saban gets paid by boosters, donors, and alumni via donations. The State of AL does not pay his salary. This is how all of big time CFB works.

  26. This is a travesty for two reasons, neither of which is mentioned:

    1. While student athletes enter into college football contracts willingly, there is an exploitative power distance between the recruits who are usually very naive and the coaches who are anything but. The NCAA, coaches, and athletic departments leverage their collective monopoly on the pipeline to professional sports and bundle athletics with the bureaucracy of public education in a way that allows coaches and administrators to take the pay that athletes otherwise would have a shot at.

    2. While only a very few college football programs are profitable (I believe U of A is one of them along with Texas), administrators and politicians dupe unintellectual students and taxpayers to fund the vast majority of football programs which are not profitable. Plus, 2.a which is that no football team is ever going to subsidize education, no matter how profitable it is. Proceeds benefit administrators and athletic facilities.

    The debt seems ominous in the article, but it’s rational to carry some debt to increase return on capital if you’re reasonably certain you can pay the debt back.

    At least this guy isn’t Sandusky or Paterno (that we know of).

  27. It is a lot cheaper than a stadium or a pro team.

  28. There is a lesson here . All colleges and high schools should have a course titled something like “How to get a Government Job and Build up Fat Pension Credits”

  29. And he’s worth every damned penny of it. Roll Tide!

  30. I essentially started three weeks past and that i makes $385 benefit $135 to $a hundred and fifty consistently simply by working at the internet from domestic. I made ina long term! “a great deal obliged to you for giving American explicit this remarkable opportunity to earn more money from domestic. This in addition coins has adjusted my lifestyles in such quite a few manners by which, supply you!”. go to this website online domestic media tech tab for extra element thank you .

  31. Will he qualify for food stamps on such a meager pension? (sarc)

    This is not unusual. The Football head coach at a state university is almost always the highest paid state employee. The Basketball coach second. They make multiple times what the governor does. It is sad, but true.

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