and if it were to be dissolved, how would those assets be distributed?

Reports and speculation about the NCAA's wealth are rampant on the internet. Talk of a P5 breakaway generates a lot of that scrutiny, but how much can claims on the internet be taken as truth?

The NCAA's response to the cancellation of the D-I basketball tournament this year suggests that many of the claims are wildly exaggerated. Their fiscal year 2020 is about to end, and they will soon issue audited financial statements for that year. How much will their net assets decline? And what are the implications of that for any breakaway in the near future?

(08-03-2020 08:40 AM)ken d Wrote:  and if it were to be dissolved, how would those assets be distributed?

Reports and speculation about the NCAA's wealth are rampant on the internet. Talk of a P5 breakaway generates a lot of that scrutiny, but how much can claims on the internet be taken as truth?

The NCAA's response to the cancellation of the D-I basketball tournament this year suggests that many of the claims are wildly exaggerated. Their fiscal year 2020 is about to end, and they will soon issue audited financial statements for that year. How much will their net assets decline? And what are the implications of that for any breakaway in the near future?

I seriously doubt the NCAA has significant assets of any kind - facilities, plant and equipment, money in the bank or in equities, etc.

It seems like a pretty much pay-as-you-go kind of operation, a kind of mega-conference where most monies go to paying staff salaries and holding the various championships, with not much saved in any way.

(08-03-2020 08:47 AM)quo vadis Wrote:  

(08-03-2020 08:40 AM)ken d Wrote:  and if it were to be dissolved, how would those assets be distributed?

Reports and speculation about the NCAA's wealth are rampant on the internet. Talk of a P5 breakaway generates a lot of that scrutiny, but how much can claims on the internet be taken as truth?

The NCAA's response to the cancellation of the D-I basketball tournament this year suggests that many of the claims are wildly exaggerated. Their fiscal year 2020 is about to end, and they will soon issue audited financial statements for that year. How much will their net assets decline? And what are the implications of that for any breakaway in the near future?

I seriously doubt the NCAA has significant assets of any kind - facilities, plant and equipment, money in the bank or in equities, etc.

It seems like a pretty much pay-as-you-go kind of operation, a kind of mega-conference where most monies go to paying staff salaries and holding the various championships, with not much saved in any way.

That would have been true decades ago, but with the NCAA tournament revenues, they started a warchest at some point. Excuse me, not a warchest, a prudent policy of having 4-6 months operating expenses held in reserve for emergencies.

They used that to pay off the $200M grants-in-aid lawsuit in 2017, and pay a $200 dividend to the schools about that time. By my math, that left $300M in the kitty.

This was all before Corona, so I'd expect the NCAA's bank account to be much skimpier now.

All data drawn from : http://www.ncaa.org/ May 26 , 2020

(08-03-2020 09:10 AM)johnbragg Wrote:  

(08-03-2020 08:47 AM)quo vadis Wrote:  

(08-03-2020 08:40 AM)ken d Wrote:  and if it were to be dissolved, how would those assets be distributed?

Reports and speculation about the NCAA's wealth are rampant on the internet. Talk of a P5 breakaway generates a lot of that scrutiny, but how much can claims on the internet be taken as truth?

The NCAA's response to the cancellation of the D-I basketball tournament this year suggests that many of the claims are wildly exaggerated. Their fiscal year 2020 is about to end, and they will soon issue audited financial statements for that year. How much will their net assets decline? And what are the implications of that for any breakaway in the near future?

I seriously doubt the NCAA has significant assets of any kind - facilities, plant and equipment, money in the bank or in equities, etc.

It seems like a pretty much pay-as-you-go kind of operation, a kind of mega-conference where most monies go to paying staff salaries and holding the various championships, with not much saved in any way.

That would have been true decades ago, but with the NCAA tournament revenues, they started a warchest at some point. Excuse me, not a warchest, a prudent policy of having 4-6 months operating expenses held in reserve for emergencies.

They used that to pay off the $200M grants-in-aid lawsuit in 2017, and pay a $200 dividend to the schools about that time. By my math, that left $300M in the kitty.

This was all before Corona, so I'd expect the NCAA's bank account to be much skimpier now.

All data drawn from : http://www.ncaa.org/ May 26 , 2020

So you took a roundabout way to reason yourself to where I am at.

So to answer the first question, if my math is correct, there would be somewhere in the ballpark of $200-300K available per member school in the event of dissolution, if every NCAA member (including D-II and D-III) shared equally. Not what you'd call a windfall for the D-I schools.

(08-03-2020 11:34 AM)ken d Wrote:  So to answer the first question, if my math is correct, there would be somewhere in the ballpark of $200-300K available per member school in the event of dissolution, if every NCAA member (including D-II and D-III) shared equally. Not what you'd call a windfall for the D-I schools.

First of all, I agree that dissolving the NCAA doesn't create a windfall profit for the thousand or so NCAA members across all divisions.

Beyond that though, it's all a black box. There was, ballpark, $300 in the kitty when corona hit. After that, we don't really have numbers for anything. TV payments for the tournament were cut--cut to nothing? Dunno. Insurance covered some percentage of the expected revenue, but not all. What percentage? Dunno. And I remember something in the spring about an emergency distirbution.

ACtually, I just googled up some numbers. USA Today: NCAA slashes payouts to member schools

Quote:The association said that of the $225 million total distribution, $50 million will come from NCAA reserves. The association also has a $270 million event-cancellation insurance policy connected to the tournament, and the proceeds, when received, will be used to pay off a line of credit that the association will tap as needed.

So the NCAA took in $270M from the insurance company, plus $50M from reserves, to distribute $225M. As the sharper-eyed reader will notice, $225M is less than $320M, so we don't have the whole picture.

There are a lot of moving pieces, a lot of ways the NCAA moves money around.

But the short answer is, the NCAA doesn't have a lot of money compared to "lets distribute the NCAA's assets amongst the members and use that money for stuff." The NCAA does have a lot of money compared to "the NCAA doesn't have any money."

At this time last year, the NCAA had about $450 million in net assets. While that's not a lot compared with some of the estimates that have been thrown out there (I've seen as high as $2 billion), it's still a substantial safety net. What's also clear is that the NCAA isn't hoarding huge sums each year by not distributing much of the proceeds of the NCAAT. Critics may not agree with how they are spending those proceeds, but they are spending them. Recently, on average they have saved about 5% of their revenues to build up reserves. This year has shown that such reserves are a prudent and necessary practice.

(08-03-2020 02:03 PM)ken d Wrote:  At this time last year, the NCAA had about $450 million in net assets. While that's not a lot compared with some of the estimates that have been thrown out there (I've seen as high as $2 billion), it's still a substantial safety net. What's also clear is that the NCAA isn't hoarding huge sums each year by not distributing much of the proceeds of the NCAAT. Critics may not agree with how they are spending those proceeds, but they are spending them. Recently, on average they have saved about 5% of their revenues to build up reserves. This year has shown that such reserves are a prudent and necessary practice.

Yes, people often talk about "The NCAA" like it's some big foreign entity unconnected to your school and just ruling over them, like the IRS is to a family household. But the NCAA is nothing more than a creation of the member schools, so when "The NCAA" does something to your school, it is the collective will of other schools that is doing it, not some imposed entity from outer space.

So it also stands to reason that, largely reflecting the will of its members, the NCAA would not be able to hoard huge amounts of money from them.