Why Isn’t Return of Bowl/TV Money a Penalty for NCAA Infractions?

UPDATE: Based on the massive amounts of tweets and emails I have received since posting this, some clarification is in order. Many believe you all (my valued readers) are not smart enough to know that non-AQ teams individually receive less than AQ teams when the day is done. I believe you all know this. But, just in case you don’t, I’ve revised the information below to make it abundantly clear.

Listening to sports talk radio over the past couple of weeks I’ve heard quite a few people suggest that the only real punishment for a program like USC or Ohio State would be to hit them in the wallet. Quite a few of you believe there should be a return of tv and bowl payout money if a team has to vacate games. Let’s talk about why that will likely never be a penalty in college football.

First, here’s something important you should know, if you don’t already. How do the payouts work for BCS bowl games (Rose, Sugar, Fiesta, Orange) and the National Championship Game?

I bet many of you didn’t know the first team selected from one of the non-AQ conferences (MAC, WAC, Sun Belt, Mountain West, C-USA) actually receives a larger, yes larger, amount than a team who automatically qualify from one of the AQ conferences (SEC, ACC, Big Ten, Big 12, Pac-12, Big East). It’s true, although that’s before conferences get involved. The first team selected from a non-AQ conference receives $24.7 million* (see below for how this payout is handled). The automatic qualifiers from the six AQ conferences receive $21.2 million each. Any other AQ teams who play in BCS bowls take in $6 million each.

In fact, the non-AQ conferences receive money even if no team from a non-AQ conference is selected for a BCS bowl game, to the tune of $12.35 million. Whether the non-AQs have a team in and receive the $24.7 million, or receive the $12.35 million for not having a team in, they have decided amongst themselves to divide BCS monies evenly between all five conferences. That’s their choice.

Now, based on tweets and email received after I wrote this piece, I need to explain this a little bit further. It is true that the first non-AQ team selected for a BCS bowl receives more than an automatic qualifying team – but that’s before conferences get involved. Payouts are filtered through the conference the team belongs to, and the conference decides how to divide the payout. The non-AQ conferences have decided in an agreement amongst themselves to divide all BCS money equally between all conferences. By contrast, each AQ conference keeps what it receives and determines how to divide amongst the schools. Most subtract expenses of the team who participated and then divide the rest equally. At the end of the day, each AQ school receives more than each non-AQ school. But, I’m pretty sure you all knew that already.

Just for the sake of spreading knowledge, there are other teams who receive a BCS share even if they don’t compete. Notre Dame, for example, receives $6 million if they are chosen for a BCS bowl, but still receive $1.7 million even if they aren’t selected. Army and Navy each receive $100,000, even if not chosen for a BCS bowl. In addition, each FCS conference (who don’t even participate in the BCS) receive $250,000.

Now that we’ve covered how payouts work, make note that the NCAA has no involvement whatsoever. That’s the short answer as to why a return of bowl money isn’t part of any NCAA penalty. It’s out of their control.

The BCS would have to demand the return of bowl money. That’s not going to happen. I heard Bill Hancock on the radio months ago talking about USC’s penalties and he was asked why they weren’t taking back the payout received by USC for the BCS National Championship Game since the win was being vacated. It was pretty simple in his mind: if USC hadn’t played in that game, another Pac-10 team would have played in a BCS bowl since the Pac-10 gets an automatic berth. So, either way the Pac-10 would have gotten the same payout, because as I described above, the payout is the same whether you’re playing in the title game or any of the other four BCS bowls. Plus, the payout goes to the conference, not to the individual team. That makes it easy for the BCS to put the burden on the conferences. The Pac-10 would have to reclaim the funds from USC for the portion they received. That’s never going to happen.

Even as USC serves their bowl ban, they’re still receiving the same distribution from the now Pac-12 as they would receive if they were participating in bowls. The only real loss is the actual playing in the bowl, which I would imagine has a larger impact on the players than the institution. The school will still receive the same financial benefits from the conference, including a portion of the BCS payout to the conference.

The same is largely true when we talk about reclaiming television money as a penalty. It would have to be a conference level decision, and a conference is never going to penalize a team like that. However, the NCAA does have a penalty whereby they can ban a program from live television appearances. They haven’t used it since 1994, when Ole Miss was banned for one year. Most believe it’s no longer used because it impacts more than just the school being punished – the punishment is felt by every program that plays the school, especially FCS schools who are missing their shot to be on television and increase their profile.

I’m not defending the situation, but I hope I’ve shed some light on why a return of bowl or tv money is never discussed in terms of penalties levied by the NCAA.

*These are the numbers from the 2010-2011 season.

6 thoughts on “Why Isn’t Return of Bowl/TV Money a Penalty for NCAA Infractions?”

  1. Kristi,

    You too have a passion about this industry and profession. I don’t want to assume anything so I’ll ask; do you (personally) think college football players “should” be paid? Why or why not?

    The Title IX argument (and federal law) concerns itself with “co-mingling” federal funds and student fees within the various male and female sports equally as I understand it (and I admit I have some learning to do there). Football teams at most colleges in D1A, the 118 – 122 colleges produce enough revenue to include their respective athletes on the income statement. Schools will compensate players based on their individual (revenue) abilities just as businesses do and just as they don’t pay coaches the same salary, but they can all pay above and beyond the scholarships they now pay these employees. To try to remain competitive, a wage scale based on supply and demand will naturally be developed. The market will take care of itself. Today, colleges are suppressing capitalism in this country by monopolizing this industry. I believe monopolies are illegal (you’re the attorney, please tell me). I might be able to go after these universities for restraint of trade and I’m sure other laws can be used to break this thing up and get fair treatment…i.e. get our share of the millions and billions.

    I’m sure many will say the football player is an amateur and thus not an employee (and not a part of this money making machine that is college football) but that is just duplicity and part of the abuse these athletes are subject to each and every day. I know you never played college football (what? It’s possible, remember the kicker at CU?) Perhaps that is why you’ve little or no sympathy and even if you have some sympathy you do not desire to see this revolution in this sport and our country as a whole. That’s what this is going to be, a revolution… David vs. Goliath.

    Goliath, the well sounding, well meaning gangster (University) who helped create this high level entertainment for student and alumni consumption while bilking billions from student fees, television contracts, taxes, and gate receipts in the name of education and all that is good while using and abusing the poor “student-athlete” who works 16 hour days (and can’t take vacation if his team plays in a bowl). He would be lucky to get three weeks off per year. He really can’t major in anything too serious since it might cut into his profession(football) for which he is forbidden from getting paid while his coaches, athletic director, secretaries etc. get paid very well. The alumni, professors, boosters and others are treated to “club level luxury” travel and other perks paid for by these generous universities. But, he’s an amateur! …the fall guy, they all say. He gets paid a scholarship and expensive resources are bandied about him to help him graduate so he gets plenty. But he doesn’t have time! And thus, 50% of these amateur students graduate overall. 50%! These universities are doing a horrible job with these gladiators! Whose fault is it? Is it the athlete who is hell bent on playing professional football and has only prepared seriously for that all his athletic life? He is the one that is responsible to take advantage of his great opportunity and if he doesn’t, oh well! Or, is it the greedy universities that makes a way for under-qualified students who would not attend college if they had other avenues and options to get into the NFL? You got it, it’s the fault of the greedy universities that want the best product on the field so they can earn more money, attention, respect, and even more money. Forget the stories of people at these universities “caring” about these poor athletes. One way or another , whether they graduate the player or not, the university still makes its millions. Sure the NCAA has instituted some guidelines for “making progress” towards a degree but in the end, they are trying to get horses to produce honey (for 50%). The universities will have to learn how to actually run businesses where they manage within a budget (while paying athletes) and then they can make a profit. Stop crying about not making money when your revenue is 30 or $40 million or even $8 million. For most BCS schools the revenue is a lot higher than $8 million. So what if you can fly 500 alumni or professors out to the big game against U-State. Run the business! Make money. Learn how to increase revenue and decrease expenses without cheating anyone out of a fair and equitable wage, particularly when those someone’s are so important to your presentation and revenue (the players). Stop making weak excuses! Go talk to your business department, perhaps they can help…because you are not talking to your ethics departments (but you are in bed with your legal teams).

    So a system similar to college baseball is in order. No title IX problems there. No scandals to speak of. In baseball, the good athletes have the option of a scholarship or being drafted. Major league baseball is fine with paying hundreds of thousands of dollars and millions to them while these young athletes develop into major league players….or not! And if not, those that were drafted have an education clause in their contracts so if they are inclined, they can return to college on their own dime. In essence, major league baseball competes with college baseball for player talent. The duplicity lies within the difference between college baseball and college football. Where’s the minor league? Ask those darn University Presidents! Are they greedy? Yes! Do they realize the gold mine they hold solely? Yes! Are they exploiting these athletes? Yes! Have they gotten in bed with the NFL? Yes! Are they using Federal law? Yes! Are colleges in bed with the Networks? Yes! Can this all be overturned or changed enough to get football players paid? Hell yes! And it will! Soon!

    College football players will be paid more than just their scholarships and it will happen within the next 5 years, hopefully sooner rather than later (my guess is within 2 to 3 years). Since the universities and NCAA have locked up long-term multi-million dollar contracts with the networks, the college game will have to change to include these employees and the salaries they will receive. No law or rule or tradition in this country can stop an idea whose time has come and one that is right, and this is one of those ideas and the time has come.

    My book will be the antithesis of yours but I’m two years behind your launch schedule. By the time my book is written and distributed, we will be well on our way to getting these athletes paid in college and all will still be well within the sport. If colleges and the NCAA want to continue to reap millions from the labor of these athletes, it will come to the table and make it right.

    Care to share some of the names of your literary agent list?

    1. I can’t get into all this right away, but Title IX will not allow some athletes to be paid more than others. I wrote a long piece on this awhile back if you search “Title IX” on the site. The title will reference Title IX and paying athletes. Also, search for “self-sustaining”. Only 22 athletic departments turn a profit without institutional support. In my opinion, pay-for-play will never happen because of these two roadblocks. I’d give you the links buy can’t do it from my phone right now. They’re both linked in the piece I have going up tomorrow.

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