The universities of Texas and Oklahoma, two of the most powerful brands in college sports, will leave the Big 12 Conference for the SEC in nine months but will suffer a much lesser financial impact from the move than the $160 million that was originally expected, the USA TODAY Network has learned.
The Big 12 announced in February that Texas and Oklahoma will forgo $100 million from the conference under an agreement that is allowing the schools to leave a year earlier than initially required. In response to recent questions from the USA TODAY Network, the conference said more than $80 million of that is based on money the schools will not get in 2024-25, the year after the move. The rest is attributed to cuts in full revenue shares for 2023-24 that Texas, Oklahoma and the rest of the Big 12’s continuing members will be taking to finance payments promised to four schools that joined the conference this summer.
Meanwhile, the Big 12 paid Colorado a $2.5 million signing bonus in late July as it began a new round of expansion, a document obtained from Colorado under an open-records request shows. That expansion will add a total of four schools to the Big 12 next summer, while Texas and Oklahoma get started in the SEC.
Information obtained through open-records requests, interviews and written exchanges with school and conference officials also found:
∎While the Big 12’s bylaws called for a withholding of two years' worth of their shares of conference revenue, Oklahoma and Texas have had no money withheld by the conference and they won't in 2023-24.
The shares — for OU, UT and the eight continuing schools — are being reduced by roughly $7 million per school compared to what they received in 2022-23 to fund payments of $18 million apiece for this year to the new members: Brigham Young, Central Florida, Cincinnati and Houston.
∎Oklahoma and Texas will be getting no money from the SEC’s primary revenue sharing pool in 2024-25, according to the schools' entry agreements. However, they stand to collect millions through football- and men’s-basketball-specific distributions that already existed under the SEC’s bylaws. They could receive additional money through other specially negotiated terms. And they will get what their agreements describe as “transition” payments being funded by ESPN.
“After Texas and Oklahoma made the decision to change conferences, those schools, along with the Big 12 and SEC, chose to accelerate the process and transition a year earlier," ESPN said in statement. "At that time, the media partners were brought in to reach a resolution that would satisfy all parties for the 2024-25 season.”
In his second year as Big 12 commissioner, Brett Yormark told the USA TODAY Network he couldn’t be more pleased. He said that all parties reached an equitable and amicable decision to part ways and that the Big 12 is now in a position of stability and strength.
“This was a business decision,” Yormark said. “Historically the withdrawal from a conference has resulted in a negotiated settlement, and we believe we landed in a good place. Our future is as bright as it’s ever been.”
Yormark has been a pivotal figure in this latest round of massive realignment that has shifted 17 schools to, or among, the Big 12, Big Ten and ACC.. He said reaching a decision with Texas and Oklahoma to depart earlier than their originally planned exit following the 2024-2025 academic year was “a win-win for all parties.”
Four Pac-12 schools — USC, UCLA, Washington and Oregon — will join the Big Ten next summer when four more — Colorado, Utah, Arizona and Arizona State — move to the Big 12 and Stanford and California go cross-country to align with the ACC as will SMU. Only Oregon State and Washington State remain in the Pac-12.
It is not clear whether Arizona, Arizona State and, or Utah have received, or are receiving, payments similar to Colorado's.
Utah denied an open-records request from USA TODAY for its agreement with the Big 12, indicating, among other reasons, that its document remains in draft form. Arizona and Arizona State have not responded to respective records requests for their agreements with the Big 12.
Texas athletics director Chris Del Conte, like Yormark, remarked on the positive outcome of the arrangements among UT, Oklahoma and the Big 12.
"Everyone's happy," he said Thursday. "As far as I know, all parties are happy with the outcome."
Oklahoma athletics director Joe Castiglione declined to comment.
Added Yormark, "In the eyes of the public, there's been no better time to be a part of the Big 12. Our footprint will encompass 10 states, four time zones and 90 million people. The narrative around the Big 12 has changed."
However, some within the Big 12 have admitted to confusion about why the league didn’t fully enforce its bylaws with Texas and Oklahoma and other aspects of the deal.
The settlement left the athletics directors at some of the continuing Big 12 schools “kind of dumbfounded,” Kansas State athletics director Gene Taylor said. “We fought back as hard as we could,” but he said the conference’s lawyers advised them, Yormark and the schools’ presidents and chancellors that the bylaws were “not as rock-solid as everybody thought and we could be tied up on lawsuits forever.”
The bylaws in place in July 2021 stated that any school withdrawing from the conference would owe a buyout amount equal to the sum of conference revenue shares it would otherwise have received during its final two years in the conference. And there was a provision that would allow most of the buyout to occur through the conference withholding revenue that it otherwise would have given to the school.
In addition, the payment of the buyout would not free the school from the Big 12's grant-of-rights agreement. In other words, if a school changed conferences before June 30, 2025, the Big 12 – rather than the new conference – would be entitled to the TV rights fees for the school’s home games.
In theory, this meant that Texas and Oklahoma faced the prospect of losing two years’ worth of money from the Big 12 – and under another provision in the bylaws, any withheld money potentially could have been redistributed to other Big 12 schools while UT and OU finished their time in the conference. In addition, Texas and Oklahoma faced the prospect of having to negotiate to essentially buy back the TV rights to their home games, so they could then transfer those rights to the SEC.
That’s not what happened. Texas and Oklahoma received full revenue shares from the Big 12 during a fiscal year ending June 30, 2022, according to the conference’s federal tax records. Former Big 12 commissioner Bob Bowlsby, who announced his plans to retire in April 2022, said no withholding of revenue occurred at that point because OU and UT were “still suggesting they would stay till the end of the (TV) contract (in June 2025). A lot of things were in flux at that time.”
Yormark, who became commissioner on Aug. 1, 2022, said at the conclusion of the conference’s spring meetings in early June 2023 that Oklahoma and Texas were getting full shares for 2022-23. And in written responses to questions from the USA TODAY Network, the schools and the Big 12 said they will be getting full shares in 2023-24, confirming their departure agreement.
The Big 12 wrote that the $100 million cited in the February statement is “an estimate based on financial distribution projections. Conference revenue derived from media rights contracts in (2024-25) will not decrease despite the early departures of OU and Texas. By leaving a year early both institutions forego (fiscal year 2024-25) distributions from the Big 12. The ($100 million) also includes (the schools’) shares of the reduced payouts this (fiscal year) that all 10 continuing members will forego as a result of expansion.”
Texas and Oklahoma also will leave behind a total of at least $13 million in NCAA basketball tournament money over a six-year span.
Iowa State athletics director Jamie Pollard said that had the bylaws been fully enforced on Texas and Oklahoma, "That would have been $160 million between the two of them. I think we're at 65% of that. … I don’t feel we were shorted or cheated as a conference. I wish (Texas and Oklahoma) were still in the league. But everybody got what they needed to get. … I would be under the assumption they’d not be paid their shares this year. Someone in the Big 12 office would have to answer that.”
Texas and Oklahoma will begin receiving full shares from the SEC in 2025-26, their “new member” agreements with the conference say.
For 2024-25, the agreements say, they won’t get any money from the SEC’s primary revenue-sharing pool. But that doesn’t mean they will get nothing from their new conference.
The SEC will cover basics like their expenses for participation in certain conference championships and other postseason events. They also will get the conference’s standard participation payments if their football and men’s basketball teams, respectively, play in a bowl game or the NCAA tournament.
Potentially more important, in 2024-25, they will get shares equally with the other 14 SEC schools in what their agreements call “new and additional marginal net revenue” that the conference gets from several sources that seem likely to produce such revenue. One is the College Football Playoff’s expansion from four teams to 12 teams that will occur, beginning with the 2024-25 season. The others are “new or amended licensing agreements … including any and all additional revenue from amended broadcast rights agreements in connection with any modifications to the SEC’s football schedule.” According to the SEC’s responses to questions provided in writing by the USA TODAY Network, a set of such modifications to the SEC’s football schedule “includes the Universities of Oklahoma and Texas becoming part of the SEC’s schedule.”
This money will be coming from ESPN, which is taking over the SEC’s featured Saturday afternoon/evening football TV rights package from CBS, beginning in 2024.
And there is more from ESPN.
Each school’s agreement with the SEC states: “The Institution has represented to the SEC that ESPN, Inc., or an affiliate of ESPN, Inc., has agreed to make a transition payment to the SEC, over and above all rights fees and other payments otherwise payable to the SEC by ESPN, Inc., and its affiliates, earmarked and designated for distribution to the Institution.” The agreements do not say how much this payment will be, and the schools and the SEC declined to comment about the amount.
Meanwhile, Texas and OU are getting other payments from ESPN under contract modifications that will shut down agreements for so-called third-tier rights to events including football and men’s basketball but primarily involving sports such as volleyball, women’s basketball, softball and baseball, and with OU, wrestling and gymnastics. Those rights will convey to the SEC, and, in turn, to the ESPN-owned SEC Network.
Texas’ Longhorn Network was created in 2011 under an agreement with ESPN and the entity now known as IMG College that had been scheduled to run through 2031 and guaranteed Texas a total of nearly $300 million. Because the guaranteed annual rights fee was set to increase each year, from 2024-25 through 2030-31, Texas had been set to collect a combined total of nearly $125 million.
The amendment covering the terms of the network’s wind-down includes a payment from ESPN to Texas that is set to be made on or before June 21, 2024 “in exchange for certain institutional rights throughout the 2024/2025 academic year.” The amount of the payment was redacted from a document obtained from the university, which declined to comment on the nature of the institutional rights it is providing to ESPN.
OU’s agreement with ESPN began with the 2022-23 school year and had been set to guarantee the school $2 million a year for three years. Similar to the Texas arrangement, the contract between Oklahoma and ESPN has been changed to include ESPN agreeing to make a payment to the university on July 1, 2024 “in exchange for certain institutional rights throughout the 2024/2025 academic year.” Also as with Texas’ deal, the amount of the payment was redacted from a document obtained from the university, which declined to comment on the nature of the institutional rights it is providing to ESPN.
There is one additional wrinkle to the wrap-up of Oklahoma’s agreement with ESPN: The school agreed that, except under specific circumstances, it will not cancel or delay its future two-game, home-and-away football series with Michigan and Nebraska. The Michigan games are set for September 2025 and 2026, the Nebraska games for 2029 and 2030. The Big Ten and Fox hold the rights to Nebraska's and Michigan's home games. Those OU home games will be part of the SEC's TV inventory for ESPN.
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