Money matter: New system to simplify bowl payouts for all

It's not exactly the end of the backroom bowl deal, but it's close.

Beginning with the 2003-04 bowl season, conferences will be able to negotiate directly with bowls on team payouts. On its surface, the NCAA legislation passed over the summer ensures the financial health of the current bowl system. Taken to a logical conclusion, it could be at least a short-term stiff arm to a I-A playoff.

Big East commissioner Mike Tranghese says the new bowl plan will make the entire process easier.(AP)

"We're going for a more open-market concept," said Dennis Poppe, NCAA managing director for baseball and football. "What it really means is we're trying to create a partnership. They've got to work out what's best for both of them."

The NCAA currently mandates a $750,000 minimum bowl payout per team. Even though legal considerations have kept the NCAA from slowing unprecedented bowl expansion in recent years, the minimum payout was still considered a financial roadblock for some bowls. This year alone, the Seattle Bowl and Silicon Valley Bowl were reportedly close to folding before filing $1.5 million letters of credit with the NCAA earlier this month.

The new legislation approved in June by the Division I Championships/Competition Cabinet could make it financially easier for the already-crowded postseason to grow even further. A group in Fort Worth, Texas, is expected to seek NCAA certification to become the 29th bowl after the 2003 season.

"Everybody is trying hard to keep them alive," said Pac-10 commissioner Tom Hansen. "Young people are playing for perceived opportunity, and we don't want to remove those."

Haggling over finances in the past has sometimes become a headache for the participating schools, conferences and bowls alike. Last year, Clemson essentially paid $500,000 for a corporate sponsorship that allowed it to get into the Humanitarian Bowl.

"For me it's a great thing," said Big East commissioner Mike Tranghese. " ... It's going to be easier. Really the deals are between conferences and bowls. It eliminates the need for a third party."

Earlier this year, the NCAA Football Certification Subcommittee issued a set of guidelines for prospective sponsors of bowls. They include conference commitment, television network, community involvement and proximity to other bowls.

The new certification criteria state a bowl must average 25,000 fans or 70 percent of stadium capacity over a three-year period. Payouts must at least equal travel and participation expenses for teams.

Each bowl that does not average a $1 million per-team payout over three years must produce a $1.5 million letter of credit. That rule would affect approximately 14 of the 28 bowls.

Bowls that do not meet the new criteria will be placed on probation for one year. If at the end of the probation, they do not comply, the bowls will lose certification. But given the proliferation of bowls -- and the new financial arrangement -- that's not likely to happen to any bowl soon.

The bowl system is arguably the biggest stumbling block for playoff proponents. There is no majority to alter its current structure, with proponents contending there are 28 "winners" every season. Those against a playoff argue that in that system, there would be only one "winner."

For the most part, commissioners, athletic directors and coaches support the bowl system because of its long-term success and viability. This year, the 28 bowls will generate $150 million for the participating schools and conferences.

Poppe referred an NCAA study of players last year, 80 percent of which said they had a "good or great time," at their bowl.

"We're in the business for them," Poppe said. "If that's the case, we want to do everything we can to provide those opportunities."

But the NCAA's role in Division I-A football is significantly less than in other sports. It essentially sets the rules for the game and certifies bowl games. Conference commissioners control the current BCS and bowl structure. Tranghese would not make the leap to say the new criteria would necessarily squelch a playoff.

"Everybody's making the linkage," Tranghese said. "I haven't even talked about it. These are our partners ... This is a better system."

"I think it's a step to bring the bowl structure into the modern era," Poppe said. "I don't know if we'll ever get rid of the postseason playoff structure talk. We hope this makes the bowl structure a little more palatable for those teams involved."

With the bowls and conferences becoming even cozier partners in the future, they can agree to a magic number where both entities can make money. One bowl source said it generally costs a school $400,000 to travel and feed a bowl party. But that figure can vary wildly depending on the size of the travel party, bowl gifts, housing, meals, length of stay, etc.

"Those bowls and those conferences can work out their own arrangements," said Ken Hoffman, executive director of the Motor City Bowl. "Some of that kind of thing that has happened in the past will be eliminated. You'll have your business deal ahead of time. You won't have to work out anything in the back room."

Tranghese pointed to NCAA's 75-25 bowl rule, which states that 75 percent of bowl revenue must go to the participating teams and which will go away under the new system. In good years, a bowl guaranteeing $1 million per team might be able to actually pay $1.2 million under the 75-25 rule, but in bad years ...

"They're bound and obligated to pay you the $1 million," Tranghese said. "What happens is that the bowl always had to pay out on the high side and take the hit on the low side."

Not now. In the future the team payouts "shall be equal in value (to) ... the participating teams reasonable contractual travel obligations and participation expenses."

"We want the long-term viability of the bowls," Poppe said. "The bowls and the conferences can negotiate a reasonable agreement between them. In all candor, the $750,000 payout to both schools in some instances was an artificial barrier. They say we're going to pay you $750,000 but you have to buy $450,000 (in tickets). Now, whatever they make them commit, that bowl has to come up with the same amount of money."