You could feel it in the air—a chill, not of fall football, but potential fallout of an OG football program. Coaches whispered. Boosters held their breath. Behind the scenes, pink slips replaced playbooks. One of the richest brands in college sports had quietly walked into a fiscal firestorm, and now, the bill’s due. And it’s not just trimming fat anymore—it’s slicing muscle here and there, and cutting every corners. On July 1, everything changed. From presidential exits to unprecedented player paydays, this was the moment college football’s glass ceiling shattered. And the reckoning? It landed hard, right in the lap of a university now $358 million in the red.
The name? University of Southern California. Yes, the same USC that once flexed with a Hollywood type of indomitable human spirit on the gridiron is now forced to cut staff and sell off assets to stay afloat. While most headlines focused on the House v. NCAA settlement green-lighting direct payments to players, few saw the tsunami building behind the scenes at USC. Outgoing President Carol Folt had been a staunch believer in athletic investment, spearheading a $225 million football performance center, rubber-stamping Lincoln Riley’s massive $10 million-per-year contract, and pushing for the school’s Big Ten leap. Visionary, yes—but costly.
In a letter to faculty and staff today, USC’s interim president Beong-Soo Kim warned of “painful” changes ahead for the university, due to an “unsustainable” deficit.
USC, per the letter, had a deficit in excess of $200m in FY2025, much higher than the $158m deficit from FY24
— Ryan Kartje (@Ryan_Kartje) July 14, 2025
Then Folt left. And in walked Beong-Soo Kim, interim president, with a brutal dose of reality. In a letter to staff on July 15, Kim didn’t sugarcoat it: “We are experiencing an unsustainable deficit.” Numbers don’t lie. A $158 million shortfall last year ballooned past $200 million in 2025. That’s $358 million headache now.
A dozen jobs were cut, including senior associate AD Paul Perrier, a longtime fixture. 6 more vacant positions? Gone. And that’s just the beginning. Kim signaled more layoffs, property sales, and pay cuts for top earners were on deck.
But the heartburn isn’t just about the pink slips—it’s about priorities. While Kim promises belt-tightening, USC is simultaneously preparing to fork out the full $20.5 million allowed under the House settlement to athletes in 2025, primarily football players. And this comes on the heels of USC leading all Big Ten and SEC schools in athletic spending last year—over $242 million, matched almost dollar-for-dollar in revenue. Now? That spend is set to spike again.
And here’s where it gets spicy. Not everyone at USC buys the whole “federal funding cuts” narrative. Faculty and staff point to questionable splurges: The D.C. Capital Campus opening in 2023, costly new security post-protest, and—yes—the golden goose itself, that Bloom Football Performance Center. Professor Sanjay Madhav didn’t mince words: “The administration has made a lot of irresponsible financial decisions… and the regular employees pay the price.” That’s not a hot take—it’s a boiling truth. USC isn’t the only university on the edge, but it might be the flashiest one to admit it.
Meanwhile, athletic director Jennifer Cohen is trying to hold the line. Instead of cutting sports, USC is pledging to share rev-share money across all 23 varsity teams. Admirable? Maybe. Sustainable? That’s the million-dollar—or $20.5 million—question. USC signed a long-term rights deal with Learfield and sold ad space in the Coliseum to DirecTV, but those moves are just sandbags against a flood.
The ripple effect—and what’s next for USC football?
It’s not just USC feeling the pinch either. Stanford slashed $140 million. Boston University laid off 120 staffers. UC froze hiring. All in reaction to looming federal research cuts under Trump-era policies. But USC’s exposure is bigger—some insiders believe they could lose $300 million in federal research dollars annually. That’s not a budget cut—that’s a chainsaw to the root system.
What’s next? That depends on who gets the top job permanently. Folt played it clean with NIL. She didn’t want boosters dabbling in gray areas. But the future might demand a little dirt under the fingernails. Think collective bargaining. Think Big Ten-SEC superleague talks. Or maybe loopholes and workarounds. It’s adapt or drown.
So yes, USC is in the fight of its life—not just for football dominance, but for its very model of existence. The lights may stay on at the Coliseum, but the boardroom bulbs are flickering. In a landscape where athletes get paychecks and presidents write pink slips, the old rules no longer apply. And USC? It’s either going to become the poster child of reinvention—or the cautionary tale of excess.
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