I'm not sure if this is a big or by design so I decided to bring it here and ask to see if I get an answer, I've noticed even for low prestige teams (the 30-40 range) making it to the tournament and not winning a game lowers your prestige. For example I got Kennesaw State up to a 31 prestige, made the tournament, lost my first game, and dropped to a 29. Is this by design? I find it makes it so that a few years in there's basically only a few dozen teams getting all the good players and all the mid level teams either become elite 70+ prestige programs or sub 20 programs.

From my understanding, there is a historical prestige and previous season prestige, and your current prestige is a mix of both. Historical prestige is calculated over 20 years. The prestige you receive each season is based on your best accomplishment that year - for example, winning 10 games might be worth 5 prestige, winning 20 games might be worth 15 prestige, making the tournament = 30 prestige, winning 1 tourney game = 40 prestige, Sweet 16 = 50 prestige etc etc (I'm making these numbers up, I don't know the actual values). So, if your historical prestige was say 20 and 2 years ago you won in the 1st round (40 prestige in our example), your current prestige would be a mix of both ie 30. Your historical prestige probably only increased from 20 to 21 since its calculated over a 20 year period. Then last season you made the first round which is worth 30 prestige in our example. Your prestige for the next season would be a mix of that 30 prestige season and your 21 historical prestige so it might come out to 25 or something. This means that it takes sustained success over the course of decades to really raise your prestige.

I hope I explained that OK and it makes sense!

That's more or less the idea - the historical prestige is not based on 20 years though its just a slow moving reflection on your program. Even winning a championship only adds a little bit to it - if you sustain 20 years of greatness then you will have a very high historical prestige because you will be Duke. You could go on the flip side and be a great program and run it down like an Indiana or Georgetown or be a team that makes a good stab at being a great program but kind of falls short like a Gonzaga - whatever the case its going to be a long term look at the program. The rest of the prestige is based on a current day rating of the program. You win it all - you have the highest prestige. Next season you don't make the tournament - it plummets right back down. This allows for a program to be hot based on a great tournament run (insert your FGCUs here) and then when the success does not repeat the next year you go right back to being someone nobody cares about.