The proposed $2.8 billion settlement marks the second stage of NCAA approval. Big 12, ACC approves deal

A potential multibillion-dollar antitrust lawsuit settlement completed the second of the NCAA’s three-stage approval process on Tuesday, with the presidential boards of two of the five conferences named in the complaint voting to approve the deal.

The NCAA Division I Board of Directors voted to accept the proposed $2.77 billion settlement in the House vs. lawsuit, according to two people briefed on the vote. NCAA. They said the vote was not unanimous, but it was unclear how the 24-member board voted.

The people spoke to The Associated Press on condition of anonymity because the NCAA did not disclose internal discussions related to the settlement. The NCAA Board of Governors must still sign the agreement for final approval. The meeting is scheduled for this week.

The DI board’s finance committee on Monday recommended sticking to the settlement’s original financial plan, drawing the ire of non-power conference leaders who believe their leagues will bear a disproportionate financial burden.

The NCAA, Big Ten, Big 12, Atlantic Coast Conference, Pac-12 and Southeastern Conference are defendants in the House of Representatives case, a class-action lawsuit seeking to recover wages for college athletes who were denied name, image and likeness compensation for the year 2016 The NCAA lifted the ban on athletes making money from sponsorship and endorsement deals in 2021.

On Tuesday, the Big 12 was the first conference to approve the settlement, and the council of university presidents and provosts voted unanimously to accept it, another person with direct knowledge of the decision told the AP. The person spoke on condition of anonymity because the conferences have not yet made any public statements regarding the settlement.

Later Tuesday, ACC presidents also voted to approve the settlement, according to a person with knowledge of their vote who spoke on the condition of anonymity.

The presidents of the Big Ten, SEC and Pac-12 were scheduled to vote on whether to approve the settlement later this week.

Going forward, the biggest investment will be made by the Big Ten, Big 12, ACC and SEC because the settlement includes a proposed revenue-sharing system in which their schools would allocate more than $20 million a year in direct payments to athletes. The total commitment is expected to be approximately $300 million per school over 10 years.

The NCAA office is expected to cover nearly $2.8 billion in damages over 10 years. Reductions in operating costs, insurance and reserve funds are expected to cover approximately $1.2 billion. The rest would come from withheld payments to 352 Division I member schools. The NCAA gives more than $700 million annually to its 1,100 member schools in three districts, the vast majority of which are Division I.

The approved financial settlement plan calls for the NCAA to cover 41% of the $2.77 billion settlement, with the Power Five conferences accounting for 24% and the other five major college football conferences – the so-called Group of Five – accounting for 10%.

Conferences competing in the second division of Division I football, the championship subdivision, would cover 14% of the total settlement, and non-football DI conferences would be charged 12%.

Conference commissioners from leagues that do not compete at the highest level of Division I football, the Bowl Subdivision, disagreed with the withheld portion of the $1.6 billion settlement.

The 27 conferences not named in the lawsuit are expected to cover 60% of the withheld payments, with the remaining 40% coming from the power conferences, which currently cover 69 schools.

Commissioners from 22 non-FBS conferences sent a memo to NCAA leadership proposing to change the financial structure so that payments withheld by the power conference would cover 60% of the $1.6 billion.

Big Sky commissioner Tom Wistrcill said Tuesday that conferences held outside the FBS provide hope for reconsideration.

“We are fighting uphill,” he said.

The Big Sky is one of the most successful conferences in the Championship subdivision, featuring schools such as Montana, Montana State, Eastern Washington, Idaho State and Weber State.

“We believe that more than 95% of the damage will go to the (Power Five) football and basketball players. It is disproportionate for conferences other than A5 to pay for this. We are asking for a more proportional structure because our student-athletes will not see the money,” Wistrcill said.

Lawyers for the plaintiffs gave the NCAA and conferences until Thursday to respond to the settlement proposal, with parties on both sides expressing hope it would be approved.

Conferences not named in the lawsuit only learned about the details of the proposed settlement two weeks ago through media reports, Wistrcill said. He said they hoped the settlement would be approved and allow for a change to the NCAA’s funding plan, but the prospects for that diminished even further after the full board approved it Tuesday night.

Wistrcill said the NCAA’s formula for withheld payments, based on a percentage of the conference’s overall NCAA distribution from 2016 to 2024, is expected to cost the Big Sky about $3 million a year for 10 years.

He said that while the total amount of money going to power conferences will be greater on a per-school basis, that revenue is a much smaller portion of athletic departments’ budgets, which typically exceed $100 million a year. It also doesn’t take into account the huge influx of revenue these schools will soon receive as a result of the expanded College Football Playoff.

Big Sky schools’ athletic budgets are approximately $20 million annually.

“The money flows to their student-athletes, while (the settlement) disproportionately punishes our institutions,” Wistrcill said.

An earlier version of this story incorrectly stated how the NCAA would cover the $2.77 billion in damages, as the entire amount would be covered by reducing operating costs, insurance and reserve funds. The NCAA will cover nearly $1.2 billion by cutting operating costs, insurance and reserve funds. Withheld payments to member schools will cover the rest, about $1.6 billion.

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