The Big Ten's proposed $2 billion-plus private capital deal is facing headwinds after a joint meeting between trustees at Michigan and USC led to unified questions about the plan, multiple sources told ESPN. The two schools discussed their shared skepticism, noting that the deal doesn't address the root issue of soaring costs that have made the need for cash so imperative for athletic departments. One sticking point is that just providing short-term money does not solve the issue. The schools also raised concerns about pending federal legislation and the general apprehension at selling equity in the conference's media rights. Both Michigan and USC believe there are better funding options and want to slow the process to explore them. The goal, according to the meeting, should be to help the Big Ten schools that need money while securing the most favorable terms possible without giving up equity. Despite the questions, the trustees' influence on the proposal is uncertain, and the agreement remains fluid and open to negotiation. Having two of the league's biggest and most storied athletic brands against it is not insignificant. The deal's framework would send a significant infusion of money to each Big Ten school, with a minimum of at least $100 million. In exchange, the league would spin off a new entity, Big Ten Enterprises, which would hold all league-wide television rights and sponsorship contracts through 2046. Individual schools would retain local radio and other deals. Shares of ownership in Big Ten Enterprises would be distributed among the league's 18 schools, the conference office, and a capital group tied to the University of California pension system. The UC pension fund would receive a 10% stake and hold minority investor rights but no direct control. The exact equity amounts per school are still being negotiated, with a small gap expected to favor the league's biggest athletic brands. A tier system for initial payments is also anticipated, with the lowest amount in the nine-figure range and larger athletic departments receiving over $150 million. The deal would extend the league's grant of rights through 2046, providing long-term stability and making further expansion or the formation of a 'super league' unlikely. A conference-wide call with league presidents and athletic directors is planned for Thursday, but more work may be needed to address Michigan and USC's concerns. No official vote has been scheduled yet. Big Ten commissioner Tony Petitti emphasized the importance of setting up a structure to maximize resources and determine if strategic investment is needed, involving all 18 leaders. The pension fund, not a private equity firm, has been attractive due to its higher valuation compared to other bids. The money infusion is crucial for Big Ten schools struggling with debt service, rising operational expenses, and providing additional scholarships and revenue to athletes. Penn State's recent termination of football coach James Franklin and potential $49 million debt highlight the financial strain faced by these schools. The Big Ten argues that the deal would alleviate financial strain and help middle- and lower-tier schools compete in football against the SEC.
