ESPN Reports Clemson, Florida State Expected to Reach Settlement with ACC
- Gavin James
- Mar 3
- 3 min read
Clemson and Florida State are poised to settle their ongoing legal disputes with the ACC, paving the way for a new revenue-distribution model that could redefine the financial structure of the conference. Sources indicate that both schools, along with the ACC Board of Directors, will vote on the proposed settlement Tuesday, a decision that could bring stability to the conference amid widespread speculation of potential departures.
Key Elements of the Settlement
The proposed agreement includes two primary components: a revised revenue-distribution plan and modifications to financial penalties for schools exiting the league before the current grant of rights expires in 2036.
New Revenue Model: Brand Initiative
The ACC’s updated revenue-distribution strategy introduces a "brand initiative" that allocates TV revenue based on a five-year rolling average of viewership. According to ESPN, "some logistics of this formula remain tricky, including how to properly average games on the unrated ACC Network or other subscription channels." Under this plan, 40% of television revenue will be evenly split among the conference’s 14 longstanding members, while 60% will be distributed based on viewership metrics.
Top-performing programs could see an annual increase of $15 million or more, whereas lower-performing schools might see reductions of up to $7 million. As ESPN notes, this is "an acceptable loss, according to several administrators at schools likely to be impacted, in exchange for some near-term stability." This system, set to take effect in the upcoming fiscal year, is designed to reward schools that drive television ratings, particularly in football.
Tying Financial Success to On-Field Performance
The new brand initiative will work in conjunction with the “success initiatives” fund established in 2023, which rewards schools for postseason success. The combination of these two programs could provide top teams with an additional $30 million annually, especially for those making deep runs in the College Football Playoff or NCAA basketball tournament.
This model aims to help ACC schools close the financial gap with the SEC and Big Ten, whose media rights deals have outpaced the ACC’s in recent years. ESPN reports that "the brand fund, combined with the separate 'success initiatives' fund... would allow teams that hit necessary benchmarks in each to close the revenue gap with the SEC and Big Ten, possibly adding in the neighborhood of $30 million or more annually."
Adjustments to the Grant of Rights Exit Penalties
A major point of contention for Clemson and Florida State has been the steep cost of leaving the ACC under the current grant of rights, which requires departing schools to pay three times their annual distribution (approximately $120 million) while forfeiting media rights through 2036.
Under the new settlement terms, exit penalties will decrease over time, with the steepest reductions coming after the 2030 season. While exact figures have not been disclosed, sources indicate that by 2029-30, the total exit fee could drop below $100 million. ESPN states, "the total cost to exit the league after the 2029-30 season is expected to drop to below $100 million, sources said."
The Broader Implications for the ACC
If the settlement is finalized Tuesday, it would mark a significant win for ACC Commissioner Jim Phillips, who has worked to keep the conference intact amid speculation of its potential dissolution. Many viewed the lawsuits filed by Clemson and Florida State in 2023 as a precursor to their departure from the ACC. However, this agreement could create a temporary truce while providing a more sustainable financial framework for top-tier programs.
Despite the settlement, uncertainty remains regarding the long-term stability of the ACC. With the Big Ten, Big 12, and College Football Playoff media deals set to be renegotiated between 2029 and 2031, conference realignment will remain a looming question. Nevertheless, the implementation of the brand initiative and the easing of exit penalties may keep the ACC intact, at least for now.
As ESPN notes, "If ACC Commissioner Jim Phillips is able to get this to the finish line Tuesday, it would be a big win for both him and the conference during a time of unprecedented change in collegiate athletics." Stay tuned for updates as the ACC Board of Directors, Clemson, and Florida State vote on the settlement Tuesday.
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