Deal between WVU, IMG College on hold
MORGANTOWN, W.Va. - West Virginia University paused the finalization of the agreement to contract its athletic department's multimedia rights to IMG College Tuesday, according to Charleston Daily Mail sources.
However, the stoppage is a standard and built-in response to a third party protesting the awarding of a contract at WVU - in this case, businessman John Raese's letter asking that WVU President Jim Clements look over what Raese believed was a conflicted process.
Upon receipt of the letter, WVU's Procurement, Contracting and Payment Services, which oversees bids and contracts, was obligated to conduct a review. One source said the review could take up to two weeks.
A source described the decision as a "procedural pause" and said the response would be the same if any other person had challenged the awarding of any other contract at the university.
The procurement office will examine Raese's allegations in a formal manner. If the review fails to validate the allegations, WVU and IMG College can proceed with their 12-year deal that could carry an overall value of $110 million with incentives. If the review confirms Raese's suspicions, WVU could be forced to restart the process. In the meantime, neither side can work together on the contract or negotiations.
Clements, Athletic Director Oliver Luck, Vice President for Legal Affairs Bill Hutchens and spokespersons for the university and the athletic department did not return messages seeking comment and clarification.
A spokesperson for IMG College deferred to WVU.
WVU and IMG College had been on track to finalize a lucrative deal for WVU's Tier 3 rights, which cover various marketing, advertising and broadcasting opportunities and most notably the radio rights for football and men's basketball games.
On Jan. 18, WVU sent IMG College, the industry leader in multimedia rights with more than 80 collegiate clients, a letter stating its intent to award IMG College the contract.
On Jan. 25, The Daily Mail reported the financial parameters of the deal. One source said then that WVU was expecting to make $5 million more than the $4 million it was making every year while controlling the Tier 3 rights independently.
Raese, owner of West Virginia Radio Corp., which has held the radio rights for years and also was a part of the bidding process for the Tier 3 contract, questioned certain ethical elements of the deal. He highlighted an apparent pending partnership between IMG College and West Virginia Media Holdings, a company that has produced coaches' shows for the football and men's basketball programs the past two years.
Raese stated that there was an "appearance of impropriety" because Drew Payne, the chair of WVU's Board of Governors, previously held a major stake in West Virginia Media Holdings and sits on the company's board of directors while still in possession of a smaller share of the company.
Payne, who declined comment when reached Tuesday night, has consistently denied wrongdoing and stated he was neither involved in nor guilty of influencing the process.
In Raese's letter to Clements, dated Feb. 13, he also questioned the recently amended contract for WVU men's basketball Coach Bob Huggins, which bumped Huggins' pay to $3 million annually. The revised contract between Huggins and WVU was initially reported by the Daily Mail on Oct. 12 and officially announced by the school Nov. 21.
Raese called Huggins' $25,000 for beating Kansas a "questionable incentive" and asked about Payne's involvement in the restructured deal, as well as the reasons behind the extension and incentive.
Raese's letter included the request for information regarding WVU's 2012 Gold-Blue spring football game and why, if ESPN wanted to broadcast the game, Luck chose to contract with West Virginia Media.
Raese also wants WVU to release information regarding the acquisition and installation of a new scoreboard beyond the south end zone at Mountaineer Field, which was completed prior to the 2008 season.
In a Feb. 8 story in the Daily Mail, Payne said "John Raese has a very lucrative deal up there with West Virginia Radio and he is trying to protect it."