Maryland will not receive distributed bowl revenue from ACC

December 12, 2013
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Even though its football team has qualified for the Military Bowl, the Maryland athletic department will not receive any of the ACC’s distributed postseason revenue as the conference continues to withhold funds, including money earned from bowl games, from the soon-to-be-departing member because the situation surrounding its exit fee has yet to be resolved.

According to the text of the ACC’s official bylaw — Section IV-5, titled “Withdrawal of Members” — the ACC may “offset the amount of such payment against any distributions otherwise due such member for any Conference year.” In other words, until the exit-fee situation is resolved, the ACC plans to continue withholding revenue from Maryland, which officially leaves for the Big Ten next July.

According to one report, the ACC will collect $54.74 million — $1 million from Maryland’s appearance in the Military Bowl — in bowl revenue this season, to be distributed among its member institutions. Had Maryland appeared in a non-ACC bowl, like the Heart of Dallas Bowl or the Pinstripe Bowl, its share still would have been given to the ACC and redistributed to everyone else.

The ACC’s continued withholding of funds was not a surprise to Maryland, which like the ACC declined to issue a formal statement on the matter.

Maryland and the other ACC teams participating in non-BCS bowls – the Chick-fil-A Bowl, Sun Bowl, Champs Sports Bowl, Music City Bowl, Belk Bowl, Independence Bowl and Military Bowl – will receive $1.1 million for bowl expenses, though those allowances are scaled based on specific game and location. Teams traveling more than 1,000 miles, for instance, receive an extra $50,000, while teams traveling between 0 and 250 miles, like Maryland, have $50,000 deducted from their allowances.

Revenue and expense payouts from the ACC also depend on how many bowl-game tickets a school sells. Each ACC school is responsible for the cost of the first 6,000 tickets. The ACC partially covers the next 2,000 tickets if they go unsold. Once a school sells 8,000 tickets, the ACC foots the bill for any other unsold tickets and that money comes from the bowl distribution pool.

Each school’s ticket allotment varies depending on the bowl game.

The ACC began withholding revenue from Maryland last December, less than three weeks after the school announced its intention to move to the Big Ten beginning in fall 2014. A letter dated Dec. 14, 2012, from ACC associate commissioner Jeff Elliott informed Athletic Director Kevin Anderson that the conference had withheld $3,067,255.27 in “respective share of the initial distribution of gross television revenues for 2012-13.”

Last month, a North Carolina appeals court rejected Maryland’s motion to dismiss the ACC’s lawsuit seeking roughly $52 million in exit fees. In that decision, Judge Robert N. Hunter Jr. wrote that all member institutions “agreed to be bound by the vote of the Council,” even though Maryland President Wallace D. Loh was one of two ACC presidents to vote against an increase in the exit fee to its current amount — approximately three times the conference’s annual operating budget — in September 2012.

In August, Maryland released a report saying the athletic department operated at a deficit of more than $21 million for the 2012-13 academic year, in part because the ACC was withholding revenue. The university has loaned the athletic department — which has a goal of being self-sufficient — upwards of $21 million to overcome the deficit, with additional loans of $20 million potentially required if the ACC continues to withhold revenue. The loans are funded by the university’s Non-State Auxiliary Funds, which are collected from school-run programs such as parking tickets and dining services.

Alex Prewitt covers the Washington Capitals. Follow him on Twitter @alex_prewitt or email him at alex.prewitt@washpost.com.
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Alex Prewitt · December 11, 2013