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Penn State Still Must Give Big Ten $11 Million For Bowl Shares in ’14 & ’15

by on September 11, 2014 10:00 PM

This week, you've no doubt heard a lot about this: Penn State is now eligible to go bowling in the 2014 and 2015 postseasons.

But, I bet, not much about this: For two more years, Penn State doesn’t get any bowl money. Zero.

“All financial penalties remain in place,” a press release from PSU noted simply his week.

That's an expensive holding pattern. Typically, Big Ten schools get a share of postseason money from the conference for its myriad bowl appearances and tie-ins -- whether they win the national championship or don't even go bowling.

But, still, not Penn State.

That the Big Ten decided to keep the four-year bowl money ban intact will cost Penn State about $11.5 million over the next two postseasons. That money is in addition to the bowl revenues Penn State has already given back to the Big Ten Conference during the first two years of the sanctions, plus a major contribution in 2011.

Over the past three years, Penn State has already forfeited over $6.5 million in bowl money. Overall, the Sandusky scandal will have cost Penn State about $18 million in total lost bowl revenues over a five-year period.

Here’s how the loss is broken down on a year-by-year basis, according to numbers released by Penn State’s Old Main for the past two seasons and projections based on reporting by the Lafayette (Ind.) Journal & Courier, Quad-City (Iowa) Times, mlive.com (Ann Arbor, Mich.), al.com (Alabama) and ESPN.com.

(Some of the aforementioned outlets have used Right-to-Know laws to gather such information. Currently, as a “state-related institution,” Penn State does not need to comply with most similar RTK requests.)

PENN STATE: LOST BIG TEN BOWL SHARES

2011-12 - $1.5 million, voluntary

2012-13 - $2.3 million, actual penalty

2013-14 - $2.75 million, actual penalty

2014-15 - $4.7 million, projected penalty

2015-16 - $6.8 million, projected penalty

Total - $18.05 million

The Big Ten’s dictated loss of bowl revenues officially began with the 2012 postseason. However, after the 2011 postseason and in light of the Sandusky scandal, Penn State gave $1.5 million of its $2.64 million bowl share to the Pennsylvania Coalition Against Rape and the national Sexual Violence Resource Center.

So, in total, the loss of bowl revenues from the 2011, 2012, 2013, 2014 and 2015 postseasons will cost Penn State that $18.05 million figure. And those are net dollars. In a normal situation with the Big Ten, Penn State would have received that money each year, whether it played in a bowl game or not. And it surely would have gone bowling after the 2012 and 2013 seasons with 8-4 and 7-5 records, respectively.

COLLEGE FOOTBALL PLAYOFF PAY-OFF

There is a big jump in bowl revenue in 2014 because of higher payoffs as a result of the College Football Playoffs and higher TV rights fees paid by ESPN.

Overall, the playoffs will create $470 million annually -- $125 million of which cover expenses, an allotment to FCS conferences and an estimated $300,000 incentive pay-off to each Power 5 school that meets an NCAA-approved Academic Progress rate (APR), whether a school goes bowling or not. That leaves $345 million in profit to be distributed, with 75% going to Power 5 conferences like the SEC and Big Ten, and 25% to what is called The Group of 5, mid-majors such as the Mid-American and Big East.

According to ESPN.com, the Big Ten is guaranteed $91 million a year in bowl money – $51 million from the playoff contracts and another $40 million as a rights-holder of the Rose Bowl. If a Big Ten team plays in the Orange Bowl too, it gets another $20 million, for a total possible payout of $118 million to the conference.

That’s a lot of bills large, but nothing close to the $44.5 million each Big Ten school will get in 2017-18, when a new TV deal – not yet announced, but likely in early negotiations – goes into effect. That multi-million-dollar pile of cash will come from bowl revenues, the Big Ten Network, the NCAA basketball tournament, sponsorships, and conference championships in football and basketball. Right now, a single-school’s share is about $25 million a year.

Penn State is not alone in zero or reduced bowl shares being distributed – and not being distributed -- by the Big Ten. Newer members (Nebraska) get a smaller share and new members (Rutgers and Maryland) get a much smaller share. Over the course of six years, the new members’ postseason shares increase until they, eventually, get a full share. For Rutgers and Maryland, that will happen in 2020-21.

PENN STATE: $7.2 MILLION IN 2017

Beginning with the 2017 postseason, Penn State gets to keep its share of the Big Ten bowl money. And that share – like all conference members except for Rutgers and Maryland -- is expected to be $7.2 million, according to the Journal & Courier.

Until then, though, the bottom line is this:

Penn State’s bottom line is still taking a huge hit.

Penn State football now has a full complement of scholarships available – 85 for the squad, same as the rest of the major college teams – and can play in the 2014 and 2015 bowl games, if the Nittany Lions win six games. (Most, if not all, of Penn State’s bowl game expenses, will be paid by the Big Ten.)

That’s all well and good. But it does not help Penn State's athletic department or any of its 30 other varsity sports, at least financially in any seven-figure significant way. And it needs the help. In the past fiscal year for which numbers were available (2012-13), according to the U.S. Dept. of Education, Penn State athletics had a budget of $104 million, but ran a deficit of $4 million plus a debt load of another $10.2 million.

So, getting the opportunity to play in a football bowl game but not getting a share of the bowl money is a cruel bit of Big Ten bait-and-switch. The return of the bowl games and a handful of scholarship get the headlines. But Penn State's athletic department, a model citizen according to George Mitchell, still gets the shaft. And that is a Big Ten decision, not the NCAA's, as Jim Delany did not put his money where Penn State's bowl money is.

The loss of the $11.5 million, plus the NCAA's annual fine of $12 million, continues to put a very severe financial crimp on the Penn State’s athletic department, creating a huge challenge for new athletic director Sandy Barbour. The NCAA sanctions decreed that Penn State could not reduce the budgets of non-football teams while the sanctions are in play. After that, Barbour could be challenged as she was at Cal Berkeley, where as athletic director she originally announced she had to cut five sports, a move that was later forestalled by an influx of money from alumni and boosters.

RICH ACCOMPLISHMENTS CONTINUE

So far, it’s a challenge that Penn State athletics has weathered largely under the radar and remarkably well – with a stiff upper lip and continued national prominence and excellence on and off the field. And by athletics, I mean real and loyal non-football people – coaches, athletes, staff, administrators, teams.

In 2013-14, Penn State finished fourth in the Learfield Cup standings, emblematic of the most successful and wide-reaching collegiate athletic programs. That’s No. 4 among 292 colleges and universities. And it would be surprising if any of the 800 athletes on Penn State’s 31 varsity teams, other a few fifth-year football players, had ever even met Jerry Sandusky.

But, in a roundabout way, those athletes are still making a contribution to Penn State’s new efforts to fight child abuse. Over the past two seasons and for the next two, the Big Ten has taken Penn State’s share of bowl money and divided equally among its conference members. The Big Ten schools are then required to donate that money to “child-focused organizations in their local communities as they deem appropriate.”

According to a May 29, 2014, Penn State press release, in 2013-14 each Big Ten school received $229,367 – one-twelfth of the $2.75 million Penn State would have as its bowl share. Penn State got one share to donate as well. In 2012-13 and 2013-14, Penn State reported that it “worked with the Centre County United Way to determine where the funds were most needed.” As a result, the Stewards of Children and the Children’s Advocacy, both located in Centre County, both have received over $200,000.

PAYING A DIFFERENT DEBT

And that’s a good thing. Money like that was distributed to worthy organizations throughout Big Ten communities. That’s going to continue for the next two years, which is good news for all the agencies and thousands of people they help.

But it comes with a caveat, one that certainly wasn’t made in clear in all the hoopla about the sanction reductions earlier this week. And that is this:

Penn State continues to pay and not get paid, even though its athletes -- past and present, men and women -- never did anything wrong.

 

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Mike Poorman has covered Penn State football since 1979, and for StateCollege.com since the 2009 season. His column appears on Mondays and Fridays. Follow him on Twitter at http://twitter.com/PSUPoorman. His views and opinions do not necessarily reflect those of Penn State University.
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