Explaining the NCAA Tournament Basketball Fund

Texas Southern NCAA Tournament First Four Basketball Fund Getty Images
(Photo by Stacy Revere/Getty Images)

In defeating Mount St. Mary’s in the First Four, Texas Southern earned their second-ever NCAA Tournament win and an opportunity to play Michigan in the First Round in search of their first-ever Round of 64 win. With the eight-point win at Assembly Hall, the Tigers also earned an additional unit in the NCAA’s Basketball Fund. 

In April 2010, the NCAA signed a 14-year, $10.8-billion media deal with CBS and Turner Sports for exclusive broadcast rights to the NCAA Tournament. Six years later, a new deal was struck for an additional eight years and $8.8 billion that runs from 2025-2032. A majority of the (currently) nearly $800 million in annual media revenue, along with other revenue from gate receipts, merchandise, and other sources, is distributed to Division-I member institutions through a multibillion-dollar Basketball Fund.

When a team appears in an NCAA Tournament game (including the First Four but not the national championship), it earns a unit for their conference. Each unit is worth $337,141 for the 2021 NCAA Tournament, the NCAA confirmed to BetMGM this week. That amount is paid to the conference each year for six years starting in 2022, meaning one unit is worth a total of $2,022,846 over six years. The conferences may use and/or distribute the funds to members however they wish.

Texas Southern earned one unit for their appearance in the First Four and another unit for their appearance in the First Round. Two units, at $337,141 apiece, equals $674,282 to the SWAC each year from 2022-28, a total of $4,045,692 over six years. (Here’s an updated Basketball Fund tracker for each conference’s earnings in the 2021 tourney.)

That’s significant money for a 10-team conference with a combined annual athletics budget of approximately $100-105 million. If split evenly, each member would receive $67,428 each year. For a school like Mississippi Valley State, that could represent nearly 2 or 3 percent of an annual budget that hovered around $4 million before COVID hit. For a fellow First Four school like Michigan State, it’s six days’ worth of salary for head coach Tom Izzo. 

On March 26, 2019, one week after the SWAC’s lone tourney team, Prairie View A&M, lost to Fairleigh Dickinson in the First Four, the AP released an analysis of nearly $3 billion in March Madness payouts from 1997-2018. Over those 22 years of payouts, the Big Ten collected $340 million. The SWAC collected $25 million. 

Even with two units in this year’s tournament for the first time since 2018, and an approximately $50,000 increase in unit value from the 2019 tournament, the SWAC will fall further behind the nine-bid Big Ten and nearly every other conference in college basketball.

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Andrew Doughty is a writer for BetMGM and host of High Motor by BetMGM, an NFL and college football podcast available on Apple Podcasts and everywhere else. He has written for Sports Illustrated, HERO Sports, Bleacher Report, and SB Nation. Follow him on Twitter: @DoughtyBetMGM