Louisville May Be Forced to Repay $5M to NCAA

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The Commercial Appeal (Memphis, Tennessee)


The University of Louisville athletics department may have to repay more than $5 million for four of its NCAA Tournament appearances as part of the NCAA Committee on Infractions' ruling against the men's basketball program.

U of L is appealing the proposed financial penalty in addition to the suggested vacation of records that could remove the Cardinals' 2013 national championship banner. If the Committee on Infractions' initial ruling is upheld, the appeal at least affords the university more time to sort through financial reports to arrive at the correct amount that must be returned for Louisville's 2012-15 NCAA Tournament appearances.

It could take close to four months before a potential appeals hearing is scheduled and even longer for a final ruling. The NCAA's Infractions Appeals Committee announced its decision in the University of Hawaii's case in March, more than 14 months after the Committee on Infractions' original ruling was announced, and that was after Hawaii elected to skip the hearing to speed up the process.

The repayment, as interim U of L President Greg Postel said, represents millions of dollars. Kenny Klein, chief spokesman for U of L's athletics department, said the university hasn't determined repayment figures, let alone specifics related to them. He said that all proposed penalties are on hold until the NCAA appeals process is completed.

"We are still trying to interpret and determine what the figures would be," Klein said.

Research by the Courier-Journal revealed the challenges in figuring the sum.

It does appear that the repayment would reach into the millions, a significant cost for a school still working its way through a scathing audit of its finances, but there's a range of possible amounts because of several unanswered questions.

The NCAA Tournament's complex "unit" structure is at the center of the confusion.

Each year, the NCAA pays conferences for the number of NCAA Tournament games their members played in the previous six years. The payment is based on the value of a unit, or tournament game, that year.

A unit was worth more than $265,000 this year, according to the Washington Post. That means the Atlantic Coast Conference would receive $6.64 million from the NCAA for its teams appearing in 25 tournament games in 2016, plus another $17.5 million for the league's 66 tournament games from 2011-15.

The ACC distributes that money equally among the 15 members each year, regardless of whether a school made the NCAA Tournament.

The unit value has increased each recent year, too. That means the money the ACC would get from the NCAA in 2018 for its 2012-17 tournament appearances would be greater than the revenue sent in 2017.

The challenge for U of L? The school was part of the old Big East Conference in 2012-13; the newly formed American Athletic Conference, which included five former Big East members and five new schools, in 2014; and the ACC in 2015.

When seven Catholic universities left the old Big East in 2013, they were allowed to take their NCAA Tournament units with them instead of leaving them with the AAC. So was Notre Dame when it left for the ACC.

It's unclear how that has impacted the NCAA Tournament revenue distributed to the AAC or if the AAC paid U of L in 2015 for its participation as a league member in the 2014 tournament. It's also unclear if U of L relinquished any NCAA Tournament units to the AAC as part of its conference exit fee.

A spokeswoman for the AAC declined to comment, saying the league wouldn't discuss its financial agreements with former members.

At first glance, U of L's NCAA Gender Equity financial reports look like the best place to start calculating the repayment figure. For the 2013-16 school years, U of L lists conference distribution of NCAA Tournament revenue that adds up to more than $5.77 million, and the majority of the 2016 report would include revenue from the 2012-15 tournaments.

But the conference distribution category may not solely include revenue generated from NCAA Tournament units.

There are other reasons why it's difficult to resolve the specific repayment, which also calls for U of L to pay back future revenue received for the 2012-15 span.

A section in the ACC manual details additional payouts for performance, with some figures even based on whether the league member played its NCAA Tournament games east or west of the Mississippi River. In 2015, U of L earned $95,000 from the ACC for reaching the NCAA Tournament and then winning two games in Seattle.

It's not clear if the Big East or AAC currently have or have had similar incentive-based payouts.

And the Gender Equity reports prior to the 2013-14 school year combine "conference distribution" and "NCAA distribution," further complicating the money issue.

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July 6, 2017


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