On Wednesday afternoon, the ACC Board of Directors announced it endorses a "success incentive initiative" that will begin in 2024-25.
The news comes a week after the league's athletic directors, head coaches and administrators gathered in Amelia Island, Fla. for the ACC's spring meetings last week. A group of schools, including Virginia Tech — "The Magnificent 7" — met over the past few months to discuss and examined the league's grant of rights, which runs through 2036. That drummed up some speculation about another wave of conference realignment last week.
However, it's likely that the group was simply trying to create some leverage to institute a new revenue distribution plan, which seems to have worked. ACC Commissioner Jim Phillips told reporters that the conference must "look at revenue differently," and this decision from the ACC presidents is a step in that direction.
"The specifics of the plan are in progress and will be solidified in the coming months," per the ACC's release. However, the new model is expected to reward schools who achieve success in football and men's basketball with a greater share of the profits. All other revenue splits will remain the same.
“The ACC Board of Directors continues to be committed to exploring all potential opportunities that will result in additional revenues and resources for the conference,” ACC Board of Directors Chair and Duke University President Vincent E. Price said in a statement. “Today’s decision provides a path to reward athletic success while also distributing additional revenue to the full membership.”
The implementation of the plan coincides with the College Football Playoff's expansion to 12 teams in 2024. Florida State athletic director Michael Alford said there are potential scenarios in which a CFP berth could add more than $10 million in revenue annually for a school. Per the Business of College Sports, a conference currently receives $6 million for each team that makes a College Football Playoff semifinal and $4 million for each team that makes a non-CFP New Year's Six bowl.
As far as the NCAA men's basketball tournament is concerned, revenue is based on financial units. "A team earns one 'unit' for every game it plays before the championship, including the first four games held in Dayton," per Sportico, which projected one game was worth just over $2 million this March. It pinned the ACC at 12 units in the 2023 NCAA tournament, equaling a projected payout of $24 million.