AAC loses 45 percent in revenue

For the longest time, UCF has been balancing a juggling act in its quest to elevate itself into the power conferences (Big 10, Big 12, Pac-12, ACC and SEC).

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For the longest time, UCF has been balancing a juggling act in its quest to elevate itself into the power conferences (Big 10, Big 12, Pac-12, ACC and SEC).

When it initially switched conferences from Conference USA to the Big East in 2011, it banked on the automatic qualifier that was under the former BCS model and the possibilities of a new media rights deal.

But as the Big East fell apart following defections, the juggling act catapulted under the new American Athletic Conference and the College Football Playoff's emergence.

In the latest turn of events, the AAC lost 45 percent of its football revenue ($12.7 million) under the new College Football Playoff structure this past season while the remaining nine conferences saw big payouts.

The reasoning: The change from BCS into a playoff system in college football eliminated the automatic qualifier status from any conference. It pushed The American out of the power conferences and further away from the "New Year's Six" bowls.

"The [AAC] is the only conference that transitioned from BCS automatic qualifier to the Group of Five," said Scott Bukstein, director of the DeVos Undergraduate Sports Business Management Program.

In the new system, the College Football Playoff allocates a baseline payout of $50 million to each of the power five conferences, Bukstein said. The remaining Group of Five (AAC, Conference USA, Mid-American, Mountain West and Sun Belt) split $60 million evenly, or a $12 million baseline payout.

The Group of Five also divides another $15 million based on conference team performance, along with an academic incentive of $300,000 for each school that meets the NCAA's required Academic Progress Rate related to bowl game participation.

"As a result, the total payout to the [AAC] for 2014-15 was approximately $15 million based on the new [College Football Playoff] system," Bukstein said.

That payout is down from the $27.9 million the AAC split during the final year of the BCS when UCF participated in the Fiesta Bowl.

During the 2013-14 season, UCF brought in $21.2 million in total football revenue, according to the Department of Education's online Equity in Athletics Data Analysis Cutting Tool. That accounts for half of UCF's athletic budget, which is about $42 million, according to board of trustees' records.

The 2014-15 season revenue should decrease, but not by a large margin. Those revenue and expense records will not be released until sometime before August.

While the College Football Playoff generates revenue primarily through its media rights agreement with ESPN, which paid about $7.3 billion over 12 years for the entire package, UCF makes up revenue in a multitude of ways.

UCF makes approximately $4 million in ticket sales, with more than three-fourths coming from football ticket sales, according to USA Today's NCAA Athletics Finance Database. That should increase with a new beach-themed club and rising prices for season tickets.

It also recoups subsidies from student athletic fees that are about $171 per semester and add up to more than $20 million per year.

But what separates UCF in terms of revenue from the power conference teams is a lucrative media rights deal. Before the Big East collapsed, it turned down a $130 million annual deal from ESPN in 2011, which would have allowed the Knights to compete with the powerhouse programs.

Instead, The American signed a six-year, $126 million deal with ESPN that expires in 2020, which UCF shares just $2 million annually.

"Television revenue has created a significant divide, which is the only thing that differentiates us from those associated with the term 'power,'" UCF Athletic Director Todd Stansbury said in a letter to UCF fans in August 2014.

These power conferences make it harder for UCF to offer recruits the same packages as a big school and limit the amount they can spend on assistant coaches and administrative staff.

If UCF was ever to leave the AAC for a power five conference, the earliest it could do so would be in 2025 due to grant of rights agreements between four of the five major conferences. Only the SEC doesn't require it now. It was placed to prevent another conference realignment flurry for at least the next decade.

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Brian Goins is a Digital Producer for the Central Florida Future. Follow him on Twitter at @byBrianGoins or email him at BrianG@CentralFloridaFuture.com.

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