Bottom line on Big East move

UConn officials ‘not worried’ about financial implications of conference switch

When UConn officially exits the American Athletic Conference to join the Big East, likely in July of next year, the move will have a dramatic effect on all aspects of the Huskies’ athletic department.

The men’s basketball team will renew old rivalries. The women’s basketball team will face somewhat more challenging competition. The football team could be left without a league to play in, at least temporarily. And then there are the finances of an athletic department that spent $41 million more in 2018 than it generated in revenue.

Though it’s too early to know just how the change in conference will affect the UConn athletic department’s bottom line, the fallout figures to be positive in some ways and negative in others.

“Initially we have more costs,” UConn president Susan Herbst said in late June at a news conference announcing the conference change. “But through more revenues, ticket sales, donors, decreased travel and then our continued work on efficiencies, we’re not worried about [finances] at all.”

Michael Leeds, a sports economist at Temple University, says that while the conference change could work from a financial standpoint if UConn basketball thrives in the Big East, it does come with potential danger. As most college athletic departments build around football programs, which tend to be the most

lucrative, UConn has gone all in on hoops.

“It really goes against the grain,” Leeds said. “[UConn] is going to the one basketball-centered conference that has really made a success of things, so in a way it’s playing into what may be a best-case scenario for this. But I think it’s still a big, big risk.”

Here are some of the ways jumping leagues will change the financial math of the Huskies’ athletic department.

TV revenue

UConn received $2.16 million in 2018 as part of the ESPN-AACTV deal that is set to expire next year and stood to earn about$7 million in future years as part of a new agreement that was announced this spring. How much the school receives as a Big East member is subject to several variables: Whether UConn gets a full revenue share (around $4 million) in its early years in the conference. Leagues typically offer reduced initial pay outs for new members, awarding them only part of what incumbent members receive. Whether the Big East and Fox renegotiate the 12-year, $500 million deal they signed in 2013, as some have speculated could happen, at least to the extent that the network offers up an additional share for UConn. The most likely scenario seems to be that UConn reaps more in TV revenue from the Big East-Fox deal than it did under the old AAC-ESPN agreement but less than it would have under the new one. The future of the football program is another unknown, but crucial, variable. If UConn joins another conference, such as the MAC or Conference USA, it will receive some amount of TV revenue from that league. If it instead goes independent, it will be free to negotiate its own TV deal, possibly with the regional sports network SNY. SNY president Steve Raab told The Courant recently that the network would have some interest in carrying Huskies football. “We’re interested in it because of what it is, and we’re also interested in it because UConn is a great partnership for us,” Raab said. “And when you truly look at partnerships, it’s not always about this sport or that sport, it’s about the larger relationship.” If things break right, UConn could earn nearly as much TV revenue as it would have in the AAC. If they don’t, this could be an area where the athletic department takes a hit.

Other conference payouts

As part of the AAC, UConn received about $2 million dollars last year in college football bowl payouts, generated by other teams in the conference that played in and won postseason games. If the school joins a smaller league for football, that figure will shrink. If UConn remains independent, it will nearly disappear altogether.

Eventually, UConn will likely benefit from increased NCAA basketball tournament payouts, given the Big East’s track record as a hoops conference, but the school will have to be patient on that front. Initially, UConn will receive only about one-sixth of what other Big East schools will take in from the NCAA’s Basketball Fund, with that number escalating through the Huskies’ first six years of membership.

In total, conference payouts are one area where changing conferences could hurt UConn financially, at least at first.

Exit/entrance fees

By far the biggest costs UConn will incur by changing conferences are the entrance and exit fees.

The school’s contract with the AAC stipulates that in order to leave, it must pay $10 million and give 27 months notice. Because UConn likely won’t wait 27 months, it will be forced to negotiate a slightly higher figure that will entice its former conference to let it leave early.

Additionally, UConn will pay the Big East $3.5 million to enter the league.

When Herbst said costs will rise initially, she was likely referring to these fees, which will surely dent the athletic department’s balance sheet in the short term.

Ticket sales, donations

Basketball ticket sales, Leeds said, could be the biggest factor in determining whether UConn’s move to the Big East eventually proves successful financially. “You really need that to make this work,” Leeds said. “There is going to be a lot of pressure on the men’s basketball team, in particular.” Early returns suggest UConn’s move has begun to pay off in that regard. The school has seen about 4,500basketball season tickets (men’s and women’s) sold or renewed since news leaked of its Big East reunion, an athletic department spokesman said. Meanwhile, more than 150 fans have donated to the university in the amount of $19.79, an homage to the year the original Big East was founded, and UConn says it expects a large year-over-year increase in July donations. UConn athletic director David Benedict argued last month that the best way to improve the department’s financial situation would be to win on the court. “In the end, if we don’t put ourselves in a position where we can be successful, none of the rest of that stuff matters,” Benedict said. “If you’re not successful, you’re not going to be able to generate resources.”

Travel

Another major area where UConn figures to benefit financially is through travel savings. Whereas the AAC is spread across much of the country, from Philadelphia to Dallas, the Big East is significantly less sprawling. Of the conference’s 11 schools, only Creighton lies west of the Mississippi River. That means shorter (and thus cheaper) trips for nearly all of UConn’s two dozen sports teams.

Those savings begin to add up. UConn notes that it spent $2 million less in travel during its last year in the old version of the Big East (2012-13) than it did this past year in the AAC. Adjusted for inflation, that would suggest about $1.8 million in potential annual savings, though the actual figure could be lower if the football team still has to travel large distances.

Other factors

Ultimately, UConn’s conference change will have ripple effects across all sorts of categories that can be difficult to predict or project. Some of the other ways UConn could either save or lose: ■ If the football team goes independent, it will likely schedule more “buy games,” i.e. games in which a school gets paid large sums to meet stronger programs on the road, in what Leeds describes as “human sacrifice.” For example, UConn will be paid $1.2 million to play at Clemson in 2021. Another one or two of these games a year would benefit the athletic department financially. ■ Football attendance is another unknown variable. If UConn goes independent and assembles a home schedule full of opponents that capture local interest (UMass, Syracuse, Boston College, etc.) maybe ticket sales at Rentschler Field begin to rise from the record lows of recent years. On the other hand, if the Huskies can’t find appealing opponents, attendance could drop further. ■ Increased interest in UConnsports could lead to a rise in sponsorship revenue. ■ As part of the AAC’s new agreement with ESPN, schools would have been responsible for producing their own broadcasts of certain sporting events, which would have resulted in an unknown additional cost. In the Big East, UConn will not have to sweat that expense. Some back-of-the-napkin math suggests UConn could easily come out ahead from its conference change, with ticket sales, donations and travel offsetting the hefty fees and loss of bowl revenue. But if anything is clear right now, with so many many variables still uncertain, it’s this: No one can say for sure. Alex Putterman can be reached at aputterman@courant.com.