How Revenue is Spent at the NCAA (2022)

by Anne Paddock

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 nearly $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 56% on scholarships/grants, about 26% on office, travel, insurance, advertising, and other expenses, and about 15% on compensation and fees paid to independent contractors. They also save (3% in 2022): except for 2020, the NCAA rarely spent total revenue, allowing the unspent funds to go the general fund, creating nearly $500,000 in net assets by 2022.

In 2022, the NCAA raised $1.224 billion. Expenses totaled $1.192 billion, leaving about $32 million to be added to the fund balance.

Expenses ($1.192 billion) were categorized as follows:

$682 million (56% of revenue): Grants
$ 75 million (6% of revenue): Compensation
$114 million (9% of revenue): Fees for Services
$135 million (11% of revenue): Travel and Conferences
$103 million (8% of revenue): Insurance
$ 30 million (2% of revenue): Office-Related Expenses
$ 28 million (2% of revenue): Operations: Printing, Awards, AV, etc
$ 19 million (2% of revenue): Advertising and Promotion
$ 6 million (1% of revenue): Other

As illustrated above, the largest expense is grants (scholarships/grants) at $682 million or 56% of revenue. The NCAA made 834 grants greater than $5,000, of which 821 were to other non-profit, tax-exempt organizations. The largest grants were awarded to:

$66 million: Atlantic Coast Conference of Greensboro, NC
$65 million: Big Ten Conference of Park Ridge, IL
$51 million: Southeastern Conference of Birmingham, AL
$34 million: Big 12 Conference of Irving, TX
$28 million: PAC-12 Conference of San Francisco, CA
$23 million: Big East Conference of New York, NY
$16 million: American Athletic Conference of Providence, RI
$13 million: Atlantic 10 Conference of Newport News, VA
$13 million: West Coast Conference of San Bruno, CA
$11 million: Conference USA of Hattiesburg, MS
$11 million: Missouri Valley Conference of St. Louis, MO
$11 million: Summit League of Elmhurst, IL
$10 million: Mountain West Conference of Colorado Springs, CO
$10 million: Mid-American Conference of Cleveland, OH
$10 million: Southland Conference of Frisco, TX

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

$100: Revenue

-$ 56: Grants

-$ 56: Subtotal Grants

$ 44: Revenue Remaining

-$ 6: Compensation

-$ 9: Fees for Services

-$ 11: Travel and Conferences

-$ 8: Insurance

-$ 2: Advertising and Promotion

-$ 2: Office-Related Expenses

-$ 1: Other Expenses

-$ 2: Operations. Printing, Awards, AV, etc

-$ 41: Subtotal: Compensation, Fees, Travel, Insurance, Advertising, Other, Sports Sci/Drug/Med

-$ 97: Total Expenses

$ 3: Excess Revenue over Expenses: To Fund Balance

As illustrated above, about $56 out of every $100 went to scholarships/grants while $15 went to compensation and fees to outside contractors. About $26 out of every $100 in revenue was used for travel, insurance, advertising, office, operations, and other expenses.

To read the IRS Form 990 (2021 for the year ending August 31, 2022), click here.