Worthy Target: Basketball’s Role in NCAA Conference Realignment

NCAA conference realignment is all the buzz these days.

Earlier this month, Texas A&M applied to be a member of the Southeastern Conference (“SEC”) and SEC presidents voted unanimously to accept the Aggies as the conference’s twelfth member.  However, the threat of legal action raised by institutional members of Texas A&M’s current conference, the Big 12 Conference (“Big 12”), has delayed the Aggies’ SEC going away party.

On September 18, 2011, the Atlantic Coast Conference (“ACC”) extended invitations to join the conference to Syracuse University and Pittsburgh University, both of which are presently members of the Big East Conference (“Big East”).  Both institutions previously applied to become members of the ACC.  However, it is unclear when Syracuse and Pittsburgh will actually become members of the ACC, as the Big East’s bylaws require schools to give 27 months notice before departing the conference.

On Monday, September 19, 2011, university officials from the University of Texas and the University of Oklahoma, both presently members of the Big 12, will meet to discuss whether each institution should leave the Big 12 for another conference.  It is suspected that both institutions will seek to join the Pac-12 Conference (“Pac-12”).

While much has been mentioned throughout the course of the past month’s conference realignment frenzy about the role of television contracts and automatic qualification in an institution’s decision as to which conference to land in, one important source of conference income has been left out of the conversation:  The NCAA Basketball Fund.

In 2010-2011, forty percent ($180,467,000.00) of the revenue distributed by the NCAA to Division I institutions was allocated to the NCAA Basketball Fund.

Teams participating in games in the NCAA Division I Men’s Basketball Championship earn one unit per each game played, except for the championship game.  Those teams that played in the 2011 championship, earned a unit of approximately $239,664.00 per each game played, absent the championship game.  The units earned by teams are distributed to their respective conferences in April of the following year and the amount distributed to the conferences is based on the respective performance of the conference’s teams over a six-year rolling period.  The NCAA suggests that the conferences divide the money received from the NCAA Basketball Fund equally amongst their member institutions.

If a member institution leaves a conference to align with another, the original conference will retain any units earned prior to realignment, so long as the original conference remains in existence.  Thus, because any institutions involved in recent realignment conversations will be members of their present conference throughout the 2011-12 season, should any of them play in games throughout the 2012 Division I Men’s Basketball Championship, their present conference will be paid the units earned from the institution’s appearance, so long as their present conference continues to exist.

Thus, while most of the talk surrounding conference realignment has centered upon income schools can earn by aligning with conferences with large television contracts in media rich locales, there is something to be said about realigning with basketball powerhouses who can earn the greatest number of NCAA Basketball Fund units.

The chart below depicts the present landscape as of September 19, 2011 of some of the largest NCAA conferences.  It also notes the number of NCAA Basketball Fund units that conference members earned in the 2011 Division I Men’s Basketball Championship.

Big 10 Big 12 Big East SEC Pac-12 ACC
Illinois (1) Baylor Cincinnati (2) Arkansas Arizona (4) Boston College
Indiana Iowa State Connecticut (5) Auburn Arizona State Clemson (1)
Iowa Kansas (4) DePaul Florida (4) Cal Duke (3)
Michigan (2) Kansas State (2) Georgetown (1) Georgia (1) Colorado Florida State (3)
Michigan State Missouri (1) Louisville (1) Kentucky (5) Oregon Georgia Tech
Minnesota Oklahoma Marquette (3) LSU Oregon State Maryland
Nebraska Oklahoma State Notre Dame (2) Mississippi Stanford Miami
Northwestern Texas (2) Pittsburgh (2) Mississippi State UCLA (2) North Carolina (4)
Ohio State (3) Texas A&M (1) Providence South Carolina USC North Carolina State
Penn State (1) Texas Tech Rutgers Tennessee (1) Utah Virginia
Purdue (2) Seton Hall Vanderbilt (1) Washington (2) Virginia Tech
Wisconsin (3) St. John’s (1) Washington State Wake Forest
Syracuse (2)
South Florida
Villanova (1)
West Virginia (2)
TOTAL TOTAL TOTAL TOTAL TOTAL TOTAL

13

10

22

12

8

11

In 2011, conferences were paid approximately $239,664.00 per each unit previously earned by their members in the Division I Men’s Basketball Championship. Assuming that the amount per unit remains at that level in 2012, teams playing in the 2011 Division I Men’s Basketball Championship earned their respective conferences the following payouts from the NCAA Basketball Fund:

Big 10

Big 12

Big East

SEC

Pac-12

ACC

$3,115,632 $2,396,640 $5,272,608 $2,875,968 $1,917,120 $2,636,304

Thus, in April 2012 when the NCAA Basketball Fund revenue is distributed to conferences, if conferences divide the money they receive equally amongst their member institutions, members of the conferences listed below could expect to receive the following amounts from the NCAA Basketball Fund:

Big 10 Big 12 Big East SEC Pac-12 ACC

$259,636

$239,664 $329,538 $261,451 $159,760 $219,692

As noted above, the NCAA mandates that if after realignment, an institution’s former conference exists, units previously earned by a transferring institution must be delivered to its former institution. Given that the college basketball season has not begun, it is completely impossible to realistically gauge which teams will be competing in the 2012 Division I Men’s Basketball Championship, let alone predict how far they will get into the tournament.  For the sake of consistency and demonstrative purposes only, assume that each team earning units in 2011 earns the exact number of units in 2012. Also assume that beginning in 2012-13, Texas A&M is a member of the SEC, Texas and Oklahoma are members of the Pac-12 and Syracuse and Pittsburgh are members of the ACC. Finally, assume that in 2012-13, the Big 12 and Big East exist, but do not gain any additional members upon Texas A&M, Texas, Oklahoma, Syracuse and Pittsburgh departing. However, their continued existence means that any units earned by their defectors in 2012 would be awarded to them in 2013.

Given these assumptions, in 2013, member institutions of each respective conference could expect to receive the following amounts from the NCAA Basketball Fund:

Big 10

Big 12

Big East

SEC

Pac-12

ACC

$259,636 $342,377 $376,614 $239,664 $136,937 $188,307

Given these amounts, ACC fans excited over welcoming perennial basketball powerhouses Syracuse and Pittsburgh to the conference won’t have much to cheer about until 2014, as the inclusion of these institutions in the conference could actually means that conference members will receive less money from the NCAA Basketball Fund in 2013.  This effect is also felt by other conferences presumptively gaining members in 2012-13.

At the same time, those conferences losing members earn a small windfall in 2013 in terms of the Basketball Fund, as member institutions remaining in the conference will receive a larger chunk of revenue from the NCAA Basketball Fund.

However, unless these conferences actively seek to admit institutions with well-performing basketball programs, it is unlikely that they will experience a similar surge in NCAA Basketball Fund revenue in future years.  Alternatively, the decrease in NCAA Basketball Fund revenue received by the SEC, Pac-12 and ACC in 2013 will likely reverse itself in 2014.

Again (although it is an absolutely crazy assumption), assume that the 2013 Division I Men’s Basketball Championship plays out exactly as it did in 2011.  Given this assumption, unit distribution in 2013 would look like this:

Big 10 Big 12 Big East SEC Pac-12 ACC
Illinois (1) Baylor Cincinnati (2) Arkansas Arizona (4) Boston College
Indiana Iowa State Connecticut (5) Auburn Arizona State Clemson (1)
Iowa Kansas (4) DePaul Florida (4) Cal Duke (3)
Michigan (2) Kansas State (2) Georgetown (1) Georgia (1) Colorado Florida State (3)
Michigan State Missouri (1) Louisville (1) Kentucky (5) Oregon Georgia Tech
Minnesota Oklahoma  State Marquette (3) LSU Oregon State Maryland
Nebraska Texas Tech Notre Dame (2) Mississippi Stanford Miami
Northwestern Providence Mississippi State UCLA (2) North Carolina (4)
Ohio State (3) Rutgers South Carolina USC North Carolina State
Penn State (1) Seton Hall Tennessee (1) Utah Virginia
Purdue (2) St. John’s (1) Vanderbilt (1) Washington (2) Virginia Tech
Wisconsin (3) South Florida Texas A&M (1) Washington State Wake Forest
Villanova (1) Oklahoma Pittsburgh (2)
West Virginia (2) Texas (2) Syracuse (2)
TOTAL TOTAL TOTAL TOTAL TOTAL TOTAL

13

7

18

13

10

15

Assuming that in 2013 each unit is worth $239,664.00 and that conferences divide the amount they receive equally amongst their member institutions, conference member institutions could expect to receive the following distributions in 2014:

Big 10

Big 12

Big East

SEC

Pac-12

ACC

$259,636 $239,664 $325,258 $259,636 $171,188 $256,782

That being said, conferences looking to expand may want to poach institutions boasting successful Men’s Basketball programs in order to reap the greatest amount of funds from the largest source of the NCAA’s revenue distribution.

Advertisements

2 thoughts on “Worthy Target: Basketball’s Role in NCAA Conference Realignment

  1. Alicia – This is interesting, but isn’t it all peanuts compared to the amount of money the conferences are looking at for football TV rights? You’re talking about hundreds of thousands for basketball tourney shares, but I think the PAC-12 has a new deal worth $3 BILLION over 12 years for football TV rights. (That doesn’t count BCS distributions and other revenue sources with football.) So, I’d suggest there’s a reason why conferences are looking more at which potential TV markets an addition brings on the football side (and why football will continue to drive the conference realignment madness).

    1. You’re dead on, Andrew. I’m just hoping to find even more money for those conferences looking to add member institutions! It may be peanuts, but in this economy, we know that everyone can use a buck. Thanks for reading!

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s