The Pac-12 painted a cheery financial picture Friday, saying it paid each of its schools $32.2 million in 2018-19, an increase of 9% from the previous year.
But there’s a few items also worth noting here.
For one, the payout is only the fourth-most among major conferences, far behind the Big Ten (estimated at $56 million), SEC ($45.3 million) and Big 12 ($33.8 million).
For another, according to the San Jose Mercury News, the Pac-12 reported per-school payouts of $31.3 million in 2017-18 in its tax filings, possibly because reserves were used, meaning it gave each of its schools only 2.7% more in 2018-19.
Then there’s this: The numbers were from 2018-19. The pre-pandemic era in college sports or, as it may also be known now, ancient history.
Who knows what the final numbers will be from 2019-20, when basketball revenues dropped off a cliff without the NCAA Tournament? The Pac-12 announced it took in $38.1 million in NCAA Tournament and conference event revenue in 2018-19 and, for 2019-20, the NCAA voted to give only $225 million to its schools, down from the expected $600 million largely because the basketball tournament was canceled.
And who knows what the numbers will be in 2020-21, when the conference will play only conference games if the football season is held at all? Or if the football season is moved to the spring, when full television revenues will likely not be available, the way UA athletic director Dave Heeke described it during an April interview with the Star.
“If you start moving everything to the spring, that’s certainly a possibility but you’re layering a lot of things on top of that,” Heeke said. “Major League Baseball, maybe the NFL moves. The NBA flows into that level. Now you’ve got college athletics, the TV contracts, PGA golf, the Masters, the US Open.
“How do you build a TV package around that and still generate the revenues that are necessary for all of those kinds of sports franchises out there?”
The Pac-12 reported $351 million in television rights fees in 2018-19, with 71% of that coming from ESPN and Fox — major networks that could be especially jammed if multiple sports leagues moved to the spring. The Pac-12 also reported $114 million in ’18-19 postseason bowl revenues, which could also be lessened in 2020-21 if fewer bowls are played or are moved to the spring.
To some extent, the Pac-12 is already bracing for the future shortfalls. The Oregonian reported last week that the Pac-12 CEO Group approved a 2020-21 budget that includes a 9% decrease in overall expenses with tiered salary reductions for employees making $100,000 or more.
The Oregonian reported that employees making six figures will receive 5-10% pay cuts while commissioner Larry Scott, who makes $5.3 million, said he will take a 12% cut ($636,000).
In an email to his staff obtained by the Oregonian, Scott said: “Our approach to cost containment and expense savings is consistent with the actions taken by our member universities, and will provide us with the maximum flexibility to manage the crisis before us and the best opportunity to emerge as strong as possible.”
Back in the old-normal world of 2018-19, the Pac-12 said it had total revenues of $530 million and distributions to schools totaling $387 million, with the revenues increasing 7% from 2017-18. That year, the Pac-12 reported revenues of $497 million and total distributions of $354 million, or $29.5 million per school.
While the Pac-12’s per-school payout increased to $32.2 million in 2018-19, the SEC distributed an average of about $45.3 million to each of its schools, according to USA Today, while the Mercury News estimated the Big Ten paid $56 million per school during the same time frame. The Big 12 announced it is distributing $33.8 million.
The Pac-12 also said combined expenses between the Pac-12 Networks and conference operations decreased 6%, although the Mercury News said conference operating expenses actually rose from $39.9 to $41.7 million based on tax filings it obtained. Expenses on the Pac-12 Networks side decreased 10% but the Mercury News said that was partly due to drops in depreciation costs and legal fees.
Overall, the Pac-12 said distributions to schools have increased 70% since its $2.7 billion media rights deal with ESPN and Fox went into effect for the 2012-13 season. That translates to a compounded annual growth rate of 9% in distributions to schools.
“The Pac-12 continues to be focused on supporting our 7,000 student-athletes through the academic and athletic missions of our member universities,” Scott said in a statement. “Our continued financial growth, media strategy under which all of our rights will be brought to market in 2024, and expense management efforts, will enable us to best support this mission.”
