As a Michigan fan I'm all about a good "get the pitchforks and torches" anti-Pitino rabble-rousing, but this isn't really bad or shocking.
The article is clear that he only gets about 15% of the total value of the contract, which is under $2M, but that figure is 98% of the cash Louisville receives in the contract. This isn't abnormal. Colleges and apparel companies usually structure their contracts so a majority of the payout isn't in cash but instead in apparel. Even at big schools like Michigan where we do get a significant cash payout from Nike, the majority of the value of the contract is still in apparel.
There are a few reasons for this, many of them similar to the accounting tricks multi-national companies like Apple use to avoid taxes. First, it allows Adidas, Nike, UA, and other shoe companies can set the value of the apparel in the contract, which they will inflate wildly over what they'd typically charge a company wanting to buy 7 or 8 figures worth of shoes and apparel. Even though they're contractually obligated to the schools, apparel companies can show pumped-up profits on all that apparel. It looks better to shareholders to say "We sold $4M (cost) worth of apparel to Louisville for $8M last year for 100% markup, we have a $10M contract with them, than to say "We sold $4M (cost) worth of apparel to Louisville last year for $5M, we have a $6.5M contract with them. You'd probably gag at the accounting numbers an NCAA program "pays" to their shoe company for each pair of shoes or cleats. Realistically the value of any athletic apparel contract is probably inflated by at least 30%. This works for both sides because universities are all non-profits so they're not going to have to worry about potentially paying taxes on the difference in the inflated values.
So the schools get massive apparel credits and use them to among other things order inventory to sell in their various campus stores, pro shops, in the stadiums, and online. Those credits are assets they can and do move around from department to department within the school. They adjust the valuation of the apparel depending on where they want to show the profit. It's the same way Apple moved all of their patents to a division in Ireland, then charged their North American division massive licensing fees. It's a paper-trick that showed less money made in the US and more profit in Ireland even though the total sales were the same; it avoided a lot of taxes for the longest time because the tax rate in Ireland was very low. That's where they wanted to show the profits. ,(The US and EU are now clamping down on those practices.)
Big Power5 schools who are making massive amounts of money on their sports use the apparel (a non-cash asset) in the same way to shuffle money out of the AD. Typically P5 schools want their AD to look as budget-neutral as possible while they're actually pumping massive amounts of money into shared campus facilities or propping up general funds. How do they do that? Have the AD transfer or sell the apparel at wholesale prices to the campus stores who exist as accounting entities outside of the AD. Then you let the bookstore show all the profit when the apparel is sold. Example: Adidas charges Louisville $25 for a t-shirt as part of their contract for almost $8M/yr in apparel. The AD transfers that shirt at a value of $25 to the bookstore. The bookstore sells it for $40. The AD shows no profit on the sale, just the $25 they paid for the t-shirt.
Small schools trying to hide how much they're actually paying for athletics can just to the opposite.