A publication of the Kentucky Center for Public Service Journalism

Rep. Kelly Flood seeks top-tier review of Kentucky’s university sports-sponsorship contracts

With the FBI and federal prosecutors investigating whether corporate money was illegally used to recruit college athletes, state Rep. Kelly Flood said it is time to increase oversight of the multi-million dollar endorsement and sponsorship contracts that public university athletic departments enter into with private companies. She filed legislation Thursday that would require boards of trustees at Kentucky’s public universities to review those sports-related contracts, adding a vital layer of accountability.

Rep. Kelly Flood

“There is no distinction between a university and its sports teams, which is why it matters that these schools’ governing boards have a formal role approving the lucrative sponsorship and endorsement contracts their athletic departments enter into,” said the Lexington legislator, whose district includes the University of Kentucky. “These contracts have grown exponentially, with some worth well over $10 million a year. The bill I am filing today simply calls for our boards of trustees to review these contracts before they’re signed, to make sure they protect the university’s good reputation and are financially viable.”

Rep. Flood, who previously chaired a House budget subcommittee, said she began reviewing corporate sponsorship contracts following the news that the University of Louisville’s relationship with ADIDAS was a focal point in the federal investigation.

“I did my due diligence and found that our universities followed proper procurement standards, which is the good news,” she said. “What stood out, however, is that the corporate interests included language in the contracts that protected them should the schools come under NCAA investigation. I didn’t find comparable protections for the universities if the situation was reversed and a company was under scrutiny. The review my bill calls for would give trustees the ability to ensure that the university’s financial security and reputation are protected in these public-private partnerships. For example, they might have questioned the previous deal U of L had with ADIDAS, which provided nearly all of the money to the coach rather than to the athletic department. It is much better if we catch these concerns on the front end rather than after the fact.”

Her legislation will be considered during the 2018 Regular Session, which began on Tuesday and is scheduled to run through mid-April.

From Legislative Research Commission

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