Pac-12 Expansion Explained: How It Started, What Are the Financial Consequences, What’s Next?

In a surprise move on Wednesday night, breaking news that thing Boise State, State of Colorado, Fresno State And State of San Diego will leave the Mountain West Conference to join State of Oregon And Washington State in the Pac-12 by the 2026-27 school year.

This latest round of conference restructuring stems from the collapse of the Pac-12 last summer, which was put into effect the year before. UCLA University And University of Southern California announced they were going to the Big Ten.

Here’s what to know about the move.

Jump to:
What prompted this? | Finance
The value of the conference | What other schools can participate?
What’s Next for the Mountain West

What prompted this?

When Oregon State and Washington State sued the Pac-12 last year to gain control of the conference’s governing board after eight schools left, they made it clear in legal filings that they wanted to be able to rebuild the conference. That doesn’t mean they definitely plan to do so. But it’s always an attractive option, even if it would be complicated to implement.

The NCAA requires conferences to have at least eight members, and after the Pac-12 disbanded, it was given a two-year grace period to stay below the minimum. That timeline shows how quickly the conference must move to stay afloat.

What does the financial situation look like?

That’s part of the reason some industry sources are skeptical that this particular path will go forward. The way the MWC rules are written, schools that leave must pay an $18 million departure fee if they give two years’ notice. That number doubles if they give less than that. Schools that leave here are expected to owe $18 million each, which is more than $70 million combined, plus the $40 million the Pac-12 will owe the Mountain West in poaching fees, part of the conferences’ scheduling agreement for this season.

The idea that the Pac-12 (OSU and WSU) and the schools that left the MWC would commit that kind of money has been dismissed by many in the industry. Over the past year, multiple sources have called those fees a non-starter for this kind of rebuild. They were clearly wrong.

The Pac-12 is expected to help schools with conference exit fees, in part because of fees for distributing media rights to departing conference members and other conference assets.

How will the new conference bring value to media rights partners?

This is where things get even more interesting. These six schools wouldn’t have paid the MWC over $100 million just to get to this point if they didn’t feel confident that the potential for increased media rights would make it worth it later. It’s also worth noting that it’s very possible that the MWC will try to retain media rights for schools that leave in the next two years, as it did when BYU, TCU, and Utah all left in 2011 and was set to be the case when San Diego State previously flirted with moving to the Pac-12 last year.

The schools that are leaving are expected to receive about $10 million a year from the Pac-12. The exact nature of that projection is unknown, but the expectation is that it will be more than double what the MWC currently distributes.

Who else is the Pac-12 targeting?

Chances are it will aim high and move to the bottom of the list. Cal And Stanford University are dream acquisitions, but making them a reality will be complicated because they have just arrived at ACC, a party to four lawsuits related to the potential departure of Clemson And State of Florida. It’s worth wondering, however, whether Cal and Stanford will regret their decision to join the ACC, given that they’ll only receive a 30% share of the league’s media rights distribution over the next seven years (in 2022-23, the ACC will distribute an average of $44.8 million per school). While ACC schools are more academically on par with the reorganized Pac-12, how much that actually matters in the big picture is up for debate.

More realistic goals are Tulane And Memphis. But those two schools would need to have a much clearer picture of their financial picture to leave the AAC than the threshold used by the four MWC schools. There would be an appeal to building a top football league outside the Power 4, but it would still have to make financial sense. UTSAIts location makes it a good fit.

Among the remaining MWC schools, UNLV is still considered a likely candidate to move as well. It checks all the boxes, but the fact that it’s not in this first round is telling. The MWC’s standing is much weaker than it was yesterday, and that could be used as leverage to get UNLV — or other MWC schools — in with a smaller annual share of the distribution, much like Cal and Stanford in the ACC. Air Force considered the most attractive MWC school.

What’s next for the Mountain West?

As things stand, its membership will be eight in two years: Air Force, Hawaii, Nevada, New Mexico, State of San JoseUNLV, State of Utah And WyomingAnother defection would drop the conference below the NCAA’s mandatory minimum, like the Pac-12 now, which would have a two-year grace period to grow back to at least eight years.

There had been previous speculation that members might try to dissolve the conference — a process that requires 75% of the vote — to avoid the exit fee to join the Pac-12, but that would mean nine teams would have to join. That’s even less likely since departing members aren’t expected to be able to vote.

Money from the Pac-12 raid could help rebuild the conference — using the Pac-12 blueprint — but it’s too early to tell about its long-term prospects.