How NCAA Earnings Affect the Amount of College Scholarships Offered

NCAA Division I and II schools provide more than $3.6 billion in athletic scholarships annually to more than 180,000 student-athletes. About $222 million of that scholarship money comes from the NCAA, while the remainder comes from the school. The NCAA also funds athletic and education programs with their earnings. 

So, how do NCAA scholarships work, and how do NCAA earnings affect the offered college scholarships? 

How does the NCAA make money? 

The National Collegiate Athletic Association (NCAA) is a non-profit organization with the purpose of equipping student-athletes for success in sports, education, and life. Because they’re non-profit, all of their proceeds go to supporting the students and the athletic programs at the NCAA-member schools. 


The NCAA has a pretty hefty budget. So, where does that money come from? The primary source of income for the NCAA comes from the television and marketing rights to the Division I men’s basketball championship (aka March Madness). That’s right, one tournament generates the strong majority of the funds for all the other NCAA sports. This accounts for $867.5 million of the NCAA’s income. $177.9 million comes from championship ticket sales, and the remainder comes from smaller sources like membership dues. 


Fun fact: D-I college football playoffs are operated independently. The NCAA doesn’t receive revenue from football playoffs

 

Where do the NCAA earnings go?

The NCAA funds scholarships, grants, and internship programs for college athletes, and they also host 90 championships in 24 sports. With over 1,200 membership schools, the NCAA has had to work diligently to figure out the best and fairest sources for monetary allocation. 


Another fun fact: Of the 90 NCAA championships, only five generate at least as much as they cost to run. Those five are men’s basketball, ice hockey, lacrosse, wrestling, and baseball. The rest of the championships “lose money,” but the NCAA doesn’t mind—  the goal is not to generate revenue, but to promote the sport and support the athletes. 

Does the NCAA offer scholarships? 

The NCAA’s largest distribution of funds goes to sport sponsorship and scholarship funds. They provide $222 million to Division I schools to help fund NCAA sports and provide full or partial scholarships for student-athletes. 


The NCAA does not provide scholarship funding for Division II or III schools. However, a lot of D-II schools still offer partial scholarships to some or all of their athletes, and even some D-III schools create specific scholarship programs for their student-athletes (not usually paid by the athletic department, though). 

What are the NCAA scholarship rules? 

Only about 2% of high school althletes are awarded athletic scholarships to compete in college. Even if an athlete is recruited to play in a college, they won’t necessarily get any scholarship money for athletics. 


Division I schools can provide full, multi-year scholarships for student-athletes if the athletic department has the budget. Some even pay for student-athletes to finish their bachelor’s or master’s after they’ve finished playing NCAA sports. Division II schools may budget to provide partial scholarships to some student-athletes as well. Most student-athletes who receive athletics scholarships receive partial scholarships. This means it doesn’t cover the entire cost for tuition, room and board, and books, but it helps cover some of it. 


Although these scholarships come directly from the school, there are other possibilities for student-athletes to receive tuition assistance, including academic scholarships, NCAA financial aid programs like the NCAA Division I Student-Athlete Opportunity Fund, and need-based aid like the Federal Pell Grants. A lot of schools also encourage student athletes to apply for other sorts of scholarships, including academic and program-based scholarships. 


The NCAA has also been working to open new sorts of scholarship opportunities through the organization, as opposed to solely through each individual member school. For example, the NCAA Committee on Women’s Athletics and the NCAA Minority Opportunities and Interests Committee recently developed the Ethnic Minority and Women’s Enhancement Graduate Scholarship.


Curious about what the NCAA scholarships limits are, or the distribution of NCAA scholarships by sport? Check out these scholarship stats


Note that the NCAA does not pay salaries to student-athletes. They’re against any sort of payment for student-athletes in an effort to preserve the integrity of the game and of the educational system. Some people believe student athletes deserve a salary, but this is a long way off— if it’ll ever happen. However, it’s possible that the NCAA will soon let students profit off of their name, image, and likeness in money-making scenarios not affiliated with the NCAA or with their school.

How does the NCAA allocate money to divisions?

After scholarships, NCAA’s next-largest expense goes to the D-I Basketball Performance Fund. They distribute $168.8 million to D-I conferences and schools based on their performance in the men’s basketball tournament over a six-year rolling period. This money funds NCAA sports at the school and provides scholarships for college athletes. That’s why so many schools place such an emphasis on basketball; that’s where a lot of the athletic department’s total budget comes from!


An additional $53.6 million goes to the D-I Equal Conference Fund, which is equally distributed among D-I basketball conferences (that meet athletic and academic standards) to play in the men’s basketball tournament. This also funds NCAA sports and scholarships at those colleges. 


Time-out. Love basketball? Check out the most outstanding NCAA basketball scores of all time! 


Starting in the 2019-2020 year, a portion of NCAA revenue is now distributed to D-I schools based on their student-athlete’s academic performance. This means that schools with higher graduation rates and academic success will receive more funds. The goal of this is to encourage an enhanced balance of sports and academics. 


Division I, naturally, has the largest budget. $153.8 million goes to D-I championships, which pays for the setup of championship games as well as team travel, food, and lodging. That includes 14 million miles of travel to get athletes to competitions! Another $10 million is distributed as D-I conference grants for programs that encourage fairness in officiating, compliance, minority opportunities, equality, and more. 


For the Division II allocation, $53.3 million is provided to fund championships, grants, and programs for their student-athletes. Division III has an allocated budget of $35.2 million.

 

How does the NCAA support student-athletes?

The NCAA was designed to support student-athletes, so they offer additional programs and assistance with this goal in mind. This includes $86.6 million for the Student Assistance Fund, given to D-I student athletes for essential needs during college like buying textbooks, emergency trips home, warm sweatshirts to handle cold days, etc.


Another $64.5 million goes to student-athlete services like catastrophic injury insurance, drug testing, leadership programs, post-grad scholarships, and championship support. The NCAA puts $3.8 million into educational services like the Emerging Leaders Seminars and the Pathway Program


We also love that the NCAA has a $49.2 million academic enhancement fund, which is distributed to D-I schools to assist with academic services and programs. The NCAA is focused on providing academic support to help their athletes achieve great heights. The NCAA even offers a degree-completion program to help former athletes graduate, because they are committed to seeing the short-term and long-term success of their students.

What are the NCAA’s association and administrative costs?

General and administrative expenses within the NCAA national office cost $44.8 million, and other association-wide expenses like legal services and business insurance cost $58.4 million. Membership-support services, like NCAA governance committees and the annual NCAA Convention, receive $23.3 million in funding. 


Learn more about where NCAA’s money goes here

How can I receive a NCAA scholarship?

It’s a challenge to get a partial, let alone a full, scholarship to play sports in colleges. The NCAA funding is distributed to best-support athletic programs and the students who play in them, but that doesn’t necessarily translate directly into scholarship money. If you’re a college-bound student-athlete looking for scholarship money or financial aid, check out these 57 student-athlete scholarships to get started. 


Did you know that Campus Colors is licensed by the NCAA? That means everything from your tees to hats to sweatpants are official team gear. Throw on your campus colors, and support the student-athletes that are bringing your favorite games to your school!