NCAA's annual distribution to Division I schools to be $225 million, down from an expected nearly $600 million
NCAA membership was bracing for a big financial hit, and on Thursday that number became clear
Had the NCAA Tournament gone on as scheduled, the NCAA was anticipating paying out approximately $600 million to Division I schools this year. But with no tournament, the NCAA announced on Thursday that the figure will be $225 million. The vote by the NCAA's Board of Governors was unanimous; the money will be handed out in June -- as opposed to the initial timeline of April -- and will be done "specifically focus on supporting college athletes."
"In its decision, the Board of Governors stressed the importance of using the distributions to aid college athletes during the uncertainty of the current environment, along with the importance of planning carefully with less revenue," the NCAA's statement reads. "The decision also allows membership to engage in planning while the NCAA continues to work with its contractual partners."
The NCAA will dip into $50 million of its reserve accounts. The organization notes that it recouped $270 million thanks to its insurance policy. The lack of revenue stands to be a huge hit with trickle-down impact in college athletics, but the chair of the Board of Governors, Ohio State president Michael Drake, said the NCAA has not been knocked off its heels by the coronavirus' impact across college sports.
"The Association has prepared for a financial catastrophic event like the one we face now," Drake said. "While we certainly have challenges ahead, we would be in a far worse position had it not been for this long-standing, forward-focused planning."
In terms of money breakdown, $53.6 of the $225 million will be split equally among the 32 conferences and teams "that meet athletic and academic standards to play in the men's basketball tournament."
The other near-$172 million will be split up based on factors the NCAA did not reveal publicly. Is the ACC going to receive as much, or more, than the Southland among that $172 million? With no official tournament bracket, it's a thorny circumstance.
"There's a lot of speculation with no real history to fall back on," SoCon commissioner Jim Schaus told CBS Sports.
Would-be NCAA Tournament monies will be treated like manna this year by the schools and leagues that rely on those funds to help support all of their scholarship sports. With no men's D-I tournament, the units paid to each league are severely damaged. Schaus said his conference would have been expecting $1.6 million in a normal year (that's just one unit; every NCAA Tournament win is another $1.6 million), and not only will the slash affect 2020, but in years to come as well. The units are paid out based on a rolling six-year period, so the cancellation of the tournament in 2020 leads to lower gains in the years ahead, too.
NCAA membership has been bracing for trickle-down impact that could be detrimental. For a league like the SoCon, one unit comprises approximately 40% of the conference's budget.
"These are just dynamics and things that we've never dealt with, and the uncertainty and not knowing when, how it's going to be resolved," Schaus said. "A lot of angst and concern about it."
USA Today reported earlier this week that Moody's Investors Service appraised the NCAA's revenue stream to drop by 42% -- that's $475 million -- in the 2020 fiscal year.
CBS Sports HQ Newsletter
We bring sports news that matters to your inbox, to help you stay informed and get a winning edge.
Thanks for signing up!
Keep an eye on your inbox for the latest sports news.
There was an error processing your subscription.
Omoruyi picked Rutgers over Auburn and Arizona State
Get the latest updates on on this season's college basketball's coaching changes
CBS and CBS Sports Network will air classic NCAA Tournament games from the past
The Elite Eight games of NCAA Tournament play that we will never forget
The Shaka Smart era at Texas isn't finished yet
Johnny Juzang, part of Kentucky's heralded 2019 recruiting class, is entering the transfer...