Conference Realignment Is Just Getting Started

Now that the Pac-12 Conference (now the Pac-4) is nearly a distant memory, there is speculation about a possible merger between the Pac and the Mountain West to further dilute a once-great conference.

Locally, according to a recent report from the Colorado state auditor, the University of Colorado Boulder Buffaloes football and men’s basketball programs turned a profit. In the case of football, CU’s program made handsomely more than its expenses. Buffs football (pre-Deion Sanders) made a $22.9 million surplus in 2022. Men’s basketball was less profitable, earning $1.1 million more than its expenses. Even football’s financial success, though, did not make up for the financial shortfalls of CU’s other programs. The university’s other programs include men’s golf, men’s basketball, men’s track and field, men’s skiing, women’s golf, women’s basketball, women’s skiing, women’s lacrosse, women’s tennis, women’s soccer, women’s volleyball and women’s track and field which had expenses run $34 million over their own revenues.

Those same financial figures are popping up across the nation with Power-Three conferences (formerly five until the recent demise of the Pac-12 and soon-to-be picked apart ACC*) pumping cash into unprofitable programs while many are hoping to offset new spiraling travel costs with increased media rights.

We talked about the impact of operating costs for private universities in early 2022. The recent consolidation of the Power Five conference members to the Power Three (Power 3) will reduce non-conference games and further distance the have’s from the have-nots. It is merely a matter of time before the Power 3 decides to reduce or take away the final source of funding for Division I mid-majors – March Madness.  It is the last bag of cash available after media rights deals bolster sky-high athletic budgets. Currently, March Madness is used to fund the NCAA operations and fund end-of-season championship tournaments for all sports. With the NCAA mortally wounded and an unclear mission, the money grab is the next obvious step.

As we have said before, like it or not, ‘like schools’ are going to need to create a new athletic division – and it may happen quicker than people think. State universities that are not part of the Power 3 are facing falling enrollments and spiraling costs as they battle state legislatures for funding. Private universities derive most of their revenue from tuition and private donors and face many of the same financial pressures. Of the 335 Division I universities, one-third are private with 11 of those already in the Power 5. Those non-Power-3 private colleges and universities, or a subset of those same colleges, will form their own intercollegiate athletic division and governing body, just as the breakaway Power 3 have done. These private institutions include some of the finest colleges and universities in the United States. As we have stated before, for private universities a basic foundation already exists with the BIG EAST, the West Coast Conference, and the Ivy League. These conference members have similar academic, financial, and athletic profiles and will form the backbone of a new collegiate athletic division.

While the Power-3 is in a never-ending quest for cash, the private college division will have to look to rein in costs and expenses while providing a championship experience similar to other D1 divisions for their student-athletes along with a valuable education. Name, Image & Likeness (NIL) will continue to exist – it is the law of the land. However, the new private division can set limits on operational costs and not have to wage a resource war against the new mega-conference schools.

Anyone who thinks we have reached the end of realignment after last week’s chaos is severely mistaken. This is just the beginning of a reformation in collegiate athletics and no program, large or small, will be untouched.

*Clemson and Florida State are expected to exit the ACC for the SEC soon

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