The NCAA’s board of governors will distribute $225m to Division I schools in June, less than half of what was originally projected, following the cancellation of men’s and women’s basketball championships and all spring college sports championships due to the ongoing Covid-19 pandemic.
The national organization for college sports was originally set to distribute about $600m to member schools, through 32 conferences, beginning next month.
Most of the NCAA’s revenue comes from media and sponsorship contracts related to the men’s basketball tournament, also known as March Madness, which remains a major event on the overall US sports calendar. But that tournament was among the first to be shelved as the public health crisis took full hold in the US earlier this month.
Now, the organization will be drawing against a $270m event cancellation insurance policy.
“We are living in unprecedented times not only for higher education but for the entire nation and around the globe as we face the Covid-19 public health crisis,” said Michael Drake, Ohio State University president and chair of the NCAA board of governors. As an association, we must acknowledge the uncertainties of our financial situation and continue to make thoughtful and prudent decisions on how we can assist conferences and campuses in supporting student-athletes now and into the future.”
Division II and III schools also will receive sharply reduced payments from the NCAA.
Bob Bowlsby, commissioner of the Big 12 Conference, said the reduced NCAA payments means the conference will receive $10m this spring instead of an anticipated $24m. The cancellation of Big 12 conference basketball tournaments meant the loss of another $6.6m.
And though the Big 12 saved on some travel and staffing costs related to conference and national basketball tournaments that weren’t incurred, that conference overall is suffered losses of $15m to $18m because of the pandemic. Other Power 5 conferences that lead Division I college sports likely suffered similar losses.
The Big 12’s financial hole, Bowlsby said, for now is being filled by using financial reserves, with its member schools being made whole.
“I think you’ll see budgets on campus flat and salary budgets flat,” he said. “It’s not a time when we’re going to throw a lot of money around. We’re all going to have to be careful about our management of resources.”