Millions at risk with guarantee football games
On Friday, New Mexico State – which heavily relies on revenue from football guarantee games – learned that one of its big-money matchups, a game versus UCLA, had been called off because of the Pac-12 Conference’s decision to only play conference games. Now the fate of another lucrative game for the Aggies, against Florida, is uncertain.
When the Big Ten and Pac-12 moved to a conference-only schedule this week, more than $45 million in guarantee money appeared to be gone. . If the other Power Five conferences -- SEC, Big 12 and ACC -follow suit, it could deal smaller programs a crushing blow.
“We get money directly from the state, we get money from the school, from student fees, from our multimedia rights holders, from our ticket sales, and we have budgeted for reductions in all of those areas,” New Mexico State athletic director Mario Moccia told USA TODAY hours after the Pac-12 announced its decision.
“This is one area where there are no cuts that we can make to make up for losing one or both guarantee games.”
USA TODAY has obtained contracts for 139 nonconference football games involving Power Five teams. The payouts for these games had been set to total nearly $122 million, including amounts due to be paid by organizers of neutral-site games such as Alabama’s now-canceled matchup with Southern California in Arlington, Texas.
For 227 games involving FBS teams, the combined guarantee total was supposed to be nearly $138 million. Though the figures do not include every game contract, a USA TODAY analysis of recent years’ guarantee-game deals estimates that the total value of all non-conference games is well over $160 million.
The Big Ten’s and Pac-12’s moves don’t necessarily mean that none of that money will change hands this season. Depending on the language of the contracts, schools may still have to pay their guarantees or negotiate settlements. Contract language covering what happens if a game is canceled for reasons beyond the parties’ control can vary greatly, with some
clauses more airtight than others.
For example, Florida’s contract with New Mexico State stipulates that if the game is called off under the prohibitory authority of the SEC, “both parties shall be relieved of any and all obligations of this agreement.”
But for contracts that don’t have that type of clause, the payment could come down to a settlement – or a legal challenge.
“Down the road what does that mean from a contractual litigation standpoint?” Moccia said. “We’ll cross those bridges when we get to them.”
USA TODAY Sports has identified at least 45 games this season that had a guarantee of $1 million or more to one or both schools.
For games against Kentucky, Alabama and Penn State, Kent State was set to receive a combined total of $5 million. According to Kent State’s most recently available annual financial report to the NCAA, its total operating revenue for the 2019 fiscal year was about
$29.5 million.
Group of Five and FCS teams would especially be affected if the SEC were to void non-conference games. For 32 SEC home games against non-Power Five teams for which USA TODAY Sports has obtained contracts, the average guarantee is scheduled to be $987,500. The highest of those guarantees is the $1.9 million for a game between Auburn and Massachusetts.
New Mexico State’s games against Florida and UCLA alone were set to pay more than $2.7 million. Moccia said he believes the Aggies’ only option if they lose their guarantees may be to take out a loan and then play more guarantee games in future years in hopes of paying it back.
“There are no more sports to discontinue. We’re down to 16 (the minimum for FBS schools),” Moccia said. “So, we’re going to have to wait and see what happens in the next few days with other leagues – if they’re going to do the same thing, if they’re going to be looking for replacement opponents, maybe we could slide in. … If ($2.7 million) comes off the board and there are no sports to discontinue, you could, in theory lay off the entire athletic department and it wouldn’t equal ($2.7 million).”
Independents such as New Mexico State, UMass and Connecticut could be forced to only play each other this season if every conference goes to a conference-only schedule. But current games with other independents provide just $400,000 of UMass’ $3.3 million in guarantees, and $600,000 of UConn’s $2.3 million.
FCS leagues are also feeling the impact. Many FCS teams get much of their revenue from playing FBS teams. For 61 FBS-FCS matchups for which USA TODAY Sports has obtained contracts, the total payout was nearly $26 million.
“Out here in the Big Sky, we play a lot of games against the Pac-12 and the Mountain West Conference and we have a lot of discussions with those commissioners, and our ADs are talking to their ADs and we are hopeful that we can find a way to make those work,” Big Sky Commissioner Tom Wistrcill said Thursday, after the Big Ten announced its decision. “Because it’s a significant portion of the revenue for every one of our schools.”