Sources: ACC considering SMU in addition to Cal and Stanford in expansion talks
The expansion conversation in the ACC goes beyond Stanford and Cal.
A third school, SMU, is in consideration, sources tell Yahoo Sports.
At a meeting of league presidents on Tuesday, executives explored the possibility of adding all three universities or inviting only the Pac-12’s two members. Administrators are expected to continue examining the expansion options and will review financial models for both scenarios — adding three or adding just two.
For more than a year now, SMU has held various degrees of dialogue with several leagues in its pursuit to join a power league, including the Big 12, Pac-12 and ACC. A small private school, SMU resides in one of America’s most populous metro areas, Dallas, and in the heart of a talent-rich football state.
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Maybe even more important: The university would arrive at a reduced rate. Employing a rich donor base and a healthy desire to advance to the Power Four level, the university is open to forgoing conference distribution pay for “at least their first five years” in “the ACC.” SMU officials held similar conversations with Pac-12 administrators.
The financials are the most significant piece to potential ACC expansion. ACC schools are handcuffed for another 13 years as part of a binding agreement tied to an ESPN contract that pays league members only a portion of Big Ten and SEC TV cash. The ACC announced a distribution of $39 million last year, most of which came from the TV contract.
In expanding, the league must avoid reducing the annual distribution paid to each team to supplement new schools. That is a “non-starter,” several administrators tell Yahoo Sports.
A perk of the ESPN contract: The network is required to increase its base distribution to the conference in a way that pays each new member the same annual rate as others — what’s termed as a “pro-rata.”
However, financial complications go much deeper. To offset the additional travel costs of acquiring Stanford, Cal and/or SMU, current ACC members will need additional revenue from the network, or Stanford and Cal would have to agree to enter the league for a partial share, "such as a 60-70% share" — conversations of which are ongoing.
The debate within the league over expansion is not new. The ACC spent the past year vetting numerous targets, ultimately determining that no program brings enough value for the trouble. However, Colorado’s exit from the Pac-12 triggered a cascade of changes and reopened the expansion door for the conference.
As Yahoo Sports reported last week, the league seriously explored adding five Pac-12 schools — Arizona, Arizona State, Utah, Cal and Stanford — before three of those five joined the Big 12. At a meeting of league presidents last Friday, expansion discussions were expected to end. However, the talks have lingered.
While the ACC debates the value of adding the three schools, the Mountain West is holding its own discussions. As Yahoo Sports reported Monday, Mountain West presidents met Monday night to explore expansion targets, most notably Oregon State and Washington State.
Another option being explored is a merger of sorts with the Pac-12’s four remaining programs in an effort to retain the Pac-12 brand and potentially keep some other perks, such as the Pac-12’s autonomous legislative authority and a higher distribution from the College Football Playoff.
Those conversations are ongoing, and it’s unclear if a reformed Pac-12 would retain either A5 status or the higher CFP distribution. In light of the latest realignment situation, the CFP is expected to examine changes to the revenue distribution model and the format, as Yahoo Sports reported Monday.
