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March Madness cancellation to cost NCAA $375 million

NCAA set to lose $375M

Cancelling March Madness because of the coronavirus pandemic will cost the NCAA about $375 million that it would have distributed to 350 schools across the nation.

Some will be able to absorb the losses better than others.

The NCAA announced Thursday it will distribute $225 million to its Division I member schools in June, nearly two-thirds less than the $600 million scheduled to be handed out in installments from April to June.

Schools that compete in the wealthiest conferences, with billion-dollar television contracts fueled by major college football, might not notice much of a difference in the short term. Schools competing in mid-major conferences are preparing to make sacrifices.

“For us, a million dollars, that's huge,” Atlantic Sun Commissioner Ted Gumbart said.

Ohio State President Michael Drake, chairman of the NCAA board of governors, said in statement the association will undertake cost-cutting measures to be determined in the upcoming weeks.

“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.”

Former NCAA executive Greg Shaheen said the association could trim expenses related to the championship events it runs.

“Look at the breadth of the 90 championships and only maybe a half dozen that cover their own costs,” he said.

The NCAA spent $153.8 million to run championship events last year.

Shaheen said millions could potentially be saved on travel costs, amenities provided to athletes and maybe even cutting the number of teams selected to compete.

Big 12 Commissioner Bob Bowlsby said his 10-member league would have expected about $24 million from NCAA distributions. Instead, he estimated, the Big 12 will receive about $10 million.

“We're going to take some hits there,” Bowlsby said.

Bowlsby said the Big 12 is likely to be down $15 million to $18 million total this academic year in terms of revenue, but could tap reserve funds to meet conference distribution projections. Last year, the Big 12 distributed about $35 million to each of its member schools.

“We have some unknowns in our budget that remain and will probably remain for a while, but I expect that we will be able to make our members whole on what we forecast as this year's distribution,” Bowlsby said. “It's a whole new ballgame if we find ourselves not playing football because of this. It affects everything we do.”

At football powerhouse Clemson, NCAA tournament revenue is generally 2%-3% of its annual athletic budget, this year at $134 million.

"It's not an insignificant amount, but there have not been discussions to cut student-athlete services based on the announcement," athletic spokesman Jeff Kallin said.

The NCAA pulled in more than $1 billion in revenue last year, including $867.5 million from the television and marketing rights for the Division I men's basketball tournament. But March Madness was cancelled March 19, a week before the first round was scheduled to begin.



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