NCAA Reduces 2020 Payouts to Division I Conferences and Schools by $375 Million

The NCAA will reduce its payouts to Division I conferences by $375 million, to about $225 million, in wake of the mass cancellations brought on by the COVID-19 pandemic, USA Today reported Thursday.

The approximately 63% cut is largely a result of the cancellation of the Division I men’s basketball tournament, which brings in “most” of the NCAA’s $1.1 billion annual revenue, according to USA Today. The NCAA was previously planning to distribute $599,622,705 to conferences and schools between April 15 through June 10; now, the entire payout will likely come in early June, NCAA chief financial officer Kathleen McNeely told USA Today.

Of the $225 million now allotted, $53.6 million will be distributed (as originally planned) to the Equal Conference Fund, which is split equally among all Division I basketball-playing conferences eligible for the NCAA tournament. The rest will be distributed among the association’s nine other funds, which contain a varying amount of money and are allocated to each conference in varying ways.

$50 million of the $225 million given out will come from NCAA reserves, according to USA Today. Additionally, the NCAA $270 million event-cancellation insurance policy for the basketball tournament which will be used to pay off the rest.

The cuts won’t affect schools across the country uniformly. Indiana, for example, told The Athletic that it will defer any “non-essential building and maintenance projects and purchases,” and that the athletics department is “now under a university-wide hiring, promotion and bonus freeze.”

Additionally, in response to the cuts, Big 12 conference commissioner Bob Bowlsby said that it’s hard to plan ahead without knowing the fate of the 2020 football season.

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Swimnerd

I like how the NCAA acts like they don’t have more money in reserve for a moment like this. But hey I guess you have to pay your people that don’t do anything to move the needle.

Irish Ringer

According to this seems like they have about $100 million yearly in overhead expenses if you include G&A, legal and insurance. Seems pretty clear where it comes from and how it’s distributed if you take them at face value. Haven’t seen anything that speaks to the amount of cash reserves they have on hand currently, but had up to $400 million at one point.
http://www.ncaa.org/about/where-does-money-go

deepsouth

anyone want to guess at how many mid major or high major swim programs get nuked b/c of this?

Was just speaking with Matt Kredich about this and it was a doozy of a realization for me. Could get even worse if football doesn’t happen this fall. Hoping our swim community is able to hold on as much as possible

DeepSouth

Anyone who might need to incur pool repair costs a likely first victims, ala College of Charleston

Love2Swim

No guesses, but definitely punches you in the gut. I fear this crisis will have ramifications that we cannot even begin to fathom.

swimgeek

This could definitely get ugly

Ladyvoldisser

Swim coaches at NCAA institutions might want to update the old resume and start looking for alternate occupations.

NOCUTSPLEASE

This is really, really bad news for mid-majors. I was already worried that the program my swimmer is at would be getting cut. Even if I was wrong it’s definitely a legitimate fear now.

200 SIDESTROKE B CUT

Ugh. Thanks. I -was- having a good Friday until you pointed out the obvious.

Inclusive Parent

How is there a $270 million cancellation insurance policy, but the $270 million only provides $175 million to be used for distribution? I get that there are other expenses that need to be covered… but by this logic, literally not one penny of NCAA’s $1.1 billion had been set aside for going to member colleges or conferences yet. Really? Football season was over, as was all the TV contracts for basketball minus the Tourney, which is likely 50% or more.. but nothing else generates revenue. How could there be no money in the first 8 months of a year?

Pennsylvania Tuxedo

By my understanding, NCAA acts as a broker for College Football Playoffs and doesn’t get anywhere near a lion’s share from the money generated in the CFP. I believe the bread and butter is March Madness, which a fraction of a percent of the payout from that pays for the national championships for all other sports, in all 3 divisions.

We’re talking a loss of revenue that looks like what is listed above.

Swim3057

The College Football Playoff falls outside of the NCAA. The 130 FBS institutions receive the funds from the CFP through their conferences. The NCAAs only revenue is from the FCS playoffs (formerly 1AA), D2 and D3.

frug

The only money the NCAA receives from FBS football is the relative pittance they get for selling bowl licenses.

The MBB tournament, on the other hand, directly accounts for 75% of the NCAA’s annual operating revenue (and some estimates push that number closer to 90% if you include indirect sources).

This is devastating for the NCAA.

About Torrey Hart

Torrey Hart

Torrey is from Oakland, CA, and majored in media studies and American studies at Claremont McKenna College, where she swam distance freestyle for the Claremont-Mudd-Scripps team. Outside of SwimSwam, she has bylines at Sports Illustrated, Yahoo Sports, SB Nation, and The Student Life newspaper.

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