Luke DeCock

ACC’s Final Four success a windfall for every team in conference

Eight-year-old Declan O’Brien of Plymouth Meeting, Pa. waits for an autograph from Brice Johnson following the Tar Heels’ practice on Thursday, March 24, 2016 at the Wells Fargo in Philadelphia, Pa.
Eight-year-old Declan O’Brien of Plymouth Meeting, Pa. waits for an autograph from Brice Johnson following the Tar Heels’ practice on Thursday, March 24, 2016 at the Wells Fargo in Philadelphia, Pa. rwillett@newsobserver.com

Having two ACC teams in the Final Four is good news for N.C. State. And Louisville. And Boston College. And all eight ACC teams that didn’t even play in the tournament this season.

Each NCAA tournament game an ACC team plays is worth hundreds of thousands of dollars to every team in the conference, whether they’re in the tournament or not. And the record-setting performance of the ACC the past two seasons will mean an annual boost of more than $400,000 to every ACC school for the next six years and possibly beyond.

The money is a distribution from the NCAA of tournament profits, mostly broadcasting. The ACC splits its share evenly among its 15 teams, which in 2015 was worth about $1.2 million per school. The success of the past two years will bump that above $1.6 million in 2017.

For every game a conference’s team plays in the NCAA tournament aside from the title game, that conference receives a “unit” for the next six years. This season’s units – paid in June for tournament performance from 2010-15 – are worth $265,791. This year, the ACC has accumulated 25 units to be paid from 2017-22.

Figuring how much this year’s 25-unit tournament is worth to the ACC requires projecting what units will be worth in the future; over the past five years, they have increased by about $5,000 per year. At the minimum, the total six-year haul from this tournament will be a record $39.9 million – and considerably more if the value of a tournament share continues to increase at the current rate.

The performance of the past two years, in which the ACC is 35-10 going into Saturday’s semifinals, will be worth more than $73.4 million over the next six years – an increase of about $433,400 per school per year from 2013 and 2014.

All of the ACC’s 15 basketball schools get a cut, regardless of their own performance or when they joined the league. The recent Big East arrivals have actually been diluting the ACC’s relatively paltry returns from 2011, 2012 and 2013, which are now split 15 ways instead of 12. There will soon be much more to go around.

“Once they join the conference and they become full members, the first year in, they get everything,” said Jeff Elliott, the ACC’s chief financial officer. “They pay the entrance fee to get in the league, and that’s their buy-in. By buying in, they get a full share.”

Whatever the spiritual costs of expansion, there’s no question the arrival of Syracuse, Pittsburgh and Notre Dame has been a financial boon from a basketball perspective. In 2015, the NCAA tournament was worth at least $32.8 million to the ACC. In 2016, at least $39.9 million. Each of those amounts is more than the ACC’s return in 2013 and 2014 combined.

The tournament money from the NCAA is distributed to the ACC’s schools in June as part of the annual omnibus payment from the conference, the most significant component of which is television revenue. This June, the basketball component will amount to a total of $21.0 million for the ACC, or $1.4 million per school. That’s up from $18.8 million a year ago, or $1.2 million per school.

By June 2017, that figure will jump to more than $24.6 million, or $1.6 million per school. And it will continue to increase over the next four seasons – and longer, if the ACC continues to perform at this level in the NCAA tournament.

So even though the tournament money isn’t broken out separately from other ACC payments, schools can still plan ahead based on its arrival over the next six years. From North Carolina’s perspective, an additional $400,000 per season could fund an entire non-revenue sport, or almost half of its entire cost-of-attendance budget.

“It wasn’t even in our minds three weeks ago,” UNC athletics director Bubba Cunningham said. “So as you do look out, particularly as a school that has so many sports and cost of attendance, those kind of increases are really meaningful to supporting students.”

It’s an unexpected windfall, one the Tar Heels helped deliver this season. The rest of the ACC will benefit as well.

Luke DeCock: 919-829-8947, ldecock@newsobserver.com, @LukeDeCock

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