How the NCAA Spends Revenue (2021)

The National Collegiate Athletic Association (NCAA) is the most well known non-profit, tax-exempt organization focused on college sports in the US. With 1,100 member colleges and universities  in 102 athletic conferences across the country that participate in 90 championships in 24 sports in 3 divisions, the NCAA is a powerful and well financed organization.

The NCAA raises about $1 billion annually (except in 2020 when revenue dropped to about $500 million due to COVID) and it may surprise you to learn the number one source of revenue for this 501 (c) (3) is television rights fees (about 80% of revenue).  

With more than $500 million in net assets, the NCAA has a significant cushion but what people really want to know is what the NCAA does with the $1 billion in revenue the organization receives annually.  The short answer is they spend about 55% on scholarships/grants, about 15% of championships, and about 20% on compensation and organization support expenses. They also save (about 10%): except for 2020, the NCAA rarely spent total revenue, allowing the unspent funds to go the general fund, creating more than $500,000 in net assets by 2021.

In 2021, the NCAA raised $1.1 billion. Expenses totaled $1 billion, leaving about $80 million to be added to the fund balance.

Expenses ($1 billion) were categorized as follows:

• $635 million (57% of revenue):  Grants
• $175 million (16% of revenue):  Div I, II, and III Championships
• $ 85  million (8% of revenue):  Compensation
• $ 66 million (6% of revenue):  Fees for Services
• $ 27 million (2% of revenue):  Insurance
• $ 14 million (1% of revenue):  Office-Related Expenses
• $ 10 million (1% of revenue):  Other
• $  8 million (1% of revenue):  Advertising and Promotion
• $  6 million (1% of revenue):  Travel and Conferences
• $  4 million (less than 1% of revenue):  Sport Sci/Drug/Med

As illustrated above, the largest expense is grants (scholarships/grants) at $635 million or 57% of revenue. The NCAA made 823 grants greater than $5,000, of which 806 were to other non-profit, tax-exempt organizations. The largest grants were awarded to:

• $64 million:  Atlantic Coast Conference of Greensboro, NC
• $61 million:  Big Ten Conference of Park Ridge, IL
• $47 million:  Southeastern Conference of Birmingham, AL
• $31 million:  Big 12 Conference of Irving, TX
• $24 million:  PAC-12 Conference of San Francisco, CA
• $23 million:  Big East Conference of New York, NY
• $14 million:  Southland Conference of Frisco, TX
• $14 million:  American Athletic Conference of Providence, RI
• $13 million:  Atlantic 10 Conference of Newport News, VA
• $12  million:  West Coast Conference of San Bruno, CA
• $10  million:  Conference USA of Hattiesburg, MS
• $10 million:  Mountain West Conference of Colorado Springs, CO
• $10  million:  Missouri Valley Conference of St. Louis, MO
• $10  million:  Summit League of Elmhurst, IL
• $ 9  million:  Mid-American Conference of Cleveland, OH

Using the above information, every $100 in revenue was spent as follows:

 $100:  Revenue

-$ 57:  Grants

-$ 16:  Division I, II, and III Championships

-$ 73:  Subtotal Grants and Championships

 $ 27:  Revenue Remaining

-$  8:  Compensation

-$  6:  Fees for Services

-$  1:  Travel and Conferences

-$  2:  Insurance

-$  1:  Advertising and Promotion

-$  1:  Office-Related Expenses

-$  1:  Other Expenses

-$  0:  Sports Sci/Drug/Med 

-$ 20: Subtotal: Compensation, Fees, Travel, Insurance, Advertising, Other, Sports Sci/Drug/Med 

-$ 93:  Total Expenses

  $  7:  Excess Revenue over Expenses:  To Fund Balance

As illustrated above, about $57 out of every $100 went to scholarships/grants while $16 went to championship expenses. About $20 out of every $100 in revenue was used for compensation and organization support expenses.

To read the IRS Form 990 (2020 for the year ending August 31, 2021), click here.