NCAA = Frauds Part II

A quote from a previous post had me intrigued so I did a little bit of research.

Roughly 95 cents of every dollar pocketed by NCAA will go to member institutions in support of student-athletes, says Greg Shaheen [the NCAA's senior vice president for basketball and business strategies]. USA Today

According to ESPN, CBS currently pays the NCAA $545 million a year for the rights to broadcast the Mens College Basketball Tournament. According to Shaheen the vast majority of those funds goes to the universities. The NCAA has an exceptionally convoluted method of allocating those funds. I don't fully understand it, but I can read Wikipedia, which has a nice summary. After the NCAA finishes with their fancy math they arrive at about $145 million in projected distribution across all the schools in the participating conferences.

Setting aside the fact that the schools that do better get more money, basically ensuring that the rich get richer, I just want to look at the actual numbers. I'm not certain if the $145 million refers to the entire distribution from NCAA tournament funds or just the 50% that is said to be distributed based on conference performance. Being the nice guy that I am, I'll give the NCAA the benefit of the doubt and say that $145 million is 50% of the total distribution. That would mean that the total distribution is $290 million.

Let's see. The NCAA gets $545 million each year from CBS and pays out $290 million total to all the schools. 95% of $545 million is about $518 million. $290 million < $518 million. $290 million is 95% of about $306 million. So where exactly is the rest of the money going? There is between $228 and $255 million ($518-$290 and $545-$290) unaccounted for in these numbers. If the $145 million value is taken as the entire distribution the numbers get even worse. Under that scenario we'd be looking at $370 to $400 million of missing money. Regardless of whether it's $400 million or just $228 million we're looking at some large stacks of cash.* It makes you wonder.

Hey, how much do you think a senior vice president of basketball and business strategies makes each year?

*Stacks of Cash, Copyright © 2003 by Señor Entropy, All rights reserved.

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