Long post ... good articles cited below, plus my $.02:
It's looking increasingly like college sports will start sharing revenue with the athletes. @Anthony Dasher posted a link to a great Yahoo article, and I'd like to point out a few things raised in it. SI also has a good article, although not as comprehensive as Ross Dellinger's Yahoo article - cited below.
In another thread linked below, several posters kept insisting that the athletic programs are already losing money or at best not making money. I pointed out these simple facts:
- The goal of the athletic departments (ADs) isn't to make money, but to raise money and then spend it. They don't have to provide financial returns to investors, or pay dividends. Their job is to raise the money each year and spend it. A few programs try to maintain a rainy day fund, but we've seen here what fans think of schools who don't spend all their money each year.
- If you consistently lose money in any enterprise, you aren't very good at your job. It either means you have to raise more revenue, cut your expenses, or both. Or you are the government (don't make this political). But if they are losing money, they are doing a good job generating revenue or controlling expenses.
Paying players isn't optional anymore. The law demands it. Stop right there if you are going to argue that point. The NCAA (meaning all the schools) has lost too many cases, and the concurring opinion in the Alston SCOTUS case makes it clear—the federal courts see the lack of payment to players as a violation of antitrust laws. You may not like it, but that is the field the NCAA and its members are playing on now.
- I pointed out what should be common sense - this is a matter of allocation. The schools have this 20% expense that is suddenly going to get added to their budgets, and the fact that it is big and suddent is to bad - when you get caught violating the law you can't claim that you are too poor to pay the damages from the past, and money to comply with the law in the future.
- I pointed out that there were plenty of things you could do, including lowering coaches' salaries, stopping building opulent facilities, etc. It was interesting to see the following the article:
There are other options too, such as reducing coaching and administrative salaries. Salaries and buyouts are responsible for nearly 40% of athletic department budgets in FBS, according to data from the Knight Commission. Another 20% of budgets are related to facility construction, renovation and debt.
Already, schools are gearing up to slice salaries. Within the contract of Missouri’s new athletic director, Laird Veatch, there will feature a “force majeure provision” related to potential changes in the college sports financial model, according to the Columbia Tribune. Model changes could trigger a renegotiation of his deal, according to the outlet.
Such a concept goes beyond the contract of athletic directors. At one SEC school, administrators at least attempted to include a similar clause within the contracts of new coaching hires. The clause triggers a salary reduction if athlete revenue-sharing is adopted, according to two people with knowledge of the clause.
As one administrator quipped, “You can always find the money.”
So, as we see, they "can always find the money" ... they like you and me with our household budgets simply have to allocate it differently. I thought the most interesting of that passage was:
- 60% of expenses are coaching, buyouts, and admin salaries. 60%. And people say there isn't any money to pay the players. LOL.
In new contracts signed by coaches and administrators, schools state that the amount may have to be adjusted if the revenue-sharing model is adopted. That's incredibly indicative of how serious this is. I wonder if Smart and Brooks have such a clause in their new contracts.
Finally, Ross Dellinger wrote about 2 things that I had never heard about:
1. Some conferences are going to, or may, pay different/lesser amounts.
2. Scholarships - there are three things here - a hint that there could be more scholarships added, that each conference could set its scholarship limits, and that scholarship amounts could be deemed part of the revenue share.
Without going too deep into anti-trust law (I don't know it at an expert level but have a good grasp on the legal concepts involved, and you don't want to read about it), it would be a really good thing if conferences decided to set their own rules on scholarships and revenue share amounts. Part of the problem with the anti-trust allegations has been that all the rules have been set from the top - the NCAA. The athletes had no options. If the conferences set some of their own rules, that removes the anti-trust problems. I mentioned this before regarding the SEC's spring transfer rules, which state that you can't transfer to an SEC school from an SEC school. Because players have other options, it takes away the anti-trust violations and that rule would likely survive a challenge.
So, let's say they decide to set the annual limit to somewhere between $17-$22 million, you could see some of this:
If schools can count scholarships as part of their revenue share (makes total sense), they could give out as many as they want up to the cap. If a school wants to give 32 to baseball, so long as Title IX is taken care of, they could do that. If they can figure out how to maintain a competitive balance, different conferences and schools within conferences can do things differently. This vitiates the anti-trust problems because players will now have options and can't complain that they are being controlled by the fact that all schools have to live by the same rules.
There is a really big IF there - how do you maintain that competitive balance? I don't know, but smarter people who are making way more than I am will figure it out. Plus, NIL has already scrambled this and made it uneven. Not to mention, it's never been even - there have always been haves and have-nots. Now, someone like Vandy can recognize they aren't ever going to win in football, do the minimum there, and then dedicate more money to baseball and basketball, where they can be more competitive. That may never happen, but if it does it will upset @BaronVonHeinsteidel greatly. jk, jk
I really like the scholarships being part of the revenue share. For athletes in sports that don't make money, that's all they should get. And that's a lot.
Other issues that have to be resolved - do they need a CBA under this model - I think they might be able to avoid that, although I think it is a good idea; do they make them employees - I think they avoid that with this model; how do you handle the transfer portal - maybe by profit sharing, and the fact that each conference can set their own rules might make that go away. A CBA makes it all go away, but we will see.
sports.yahoo.com
www.espn.com
It's looking increasingly like college sports will start sharing revenue with the athletes. @Anthony Dasher posted a link to a great Yahoo article, and I'd like to point out a few things raised in it. SI also has a good article, although not as comprehensive as Ross Dellinger's Yahoo article - cited below.
In another thread linked below, several posters kept insisting that the athletic programs are already losing money or at best not making money. I pointed out these simple facts:
- The goal of the athletic departments (ADs) isn't to make money, but to raise money and then spend it. They don't have to provide financial returns to investors, or pay dividends. Their job is to raise the money each year and spend it. A few programs try to maintain a rainy day fund, but we've seen here what fans think of schools who don't spend all their money each year.
- If you consistently lose money in any enterprise, you aren't very good at your job. It either means you have to raise more revenue, cut your expenses, or both. Or you are the government (don't make this political). But if they are losing money, they are doing a good job generating revenue or controlling expenses.
Paying players isn't optional anymore. The law demands it. Stop right there if you are going to argue that point. The NCAA (meaning all the schools) has lost too many cases, and the concurring opinion in the Alston SCOTUS case makes it clear—the federal courts see the lack of payment to players as a violation of antitrust laws. You may not like it, but that is the field the NCAA and its members are playing on now.
- I pointed out what should be common sense - this is a matter of allocation. The schools have this 20% expense that is suddenly going to get added to their budgets, and the fact that it is big and suddent is to bad - when you get caught violating the law you can't claim that you are too poor to pay the damages from the past, and money to comply with the law in the future.
- I pointed out that there were plenty of things you could do, including lowering coaches' salaries, stopping building opulent facilities, etc. It was interesting to see the following the article:
There are other options too, such as reducing coaching and administrative salaries. Salaries and buyouts are responsible for nearly 40% of athletic department budgets in FBS, according to data from the Knight Commission. Another 20% of budgets are related to facility construction, renovation and debt.
Already, schools are gearing up to slice salaries. Within the contract of Missouri’s new athletic director, Laird Veatch, there will feature a “force majeure provision” related to potential changes in the college sports financial model, according to the Columbia Tribune. Model changes could trigger a renegotiation of his deal, according to the outlet.
Such a concept goes beyond the contract of athletic directors. At one SEC school, administrators at least attempted to include a similar clause within the contracts of new coaching hires. The clause triggers a salary reduction if athlete revenue-sharing is adopted, according to two people with knowledge of the clause.
As one administrator quipped, “You can always find the money.”
So, as we see, they "can always find the money" ... they like you and me with our household budgets simply have to allocate it differently. I thought the most interesting of that passage was:
- 60% of expenses are coaching, buyouts, and admin salaries. 60%. And people say there isn't any money to pay the players. LOL.
In new contracts signed by coaches and administrators, schools state that the amount may have to be adjusted if the revenue-sharing model is adopted. That's incredibly indicative of how serious this is. I wonder if Smart and Brooks have such a clause in their new contracts.
Finally, Ross Dellinger wrote about 2 things that I had never heard about:
1. Some conferences are going to, or may, pay different/lesser amounts.
2. Scholarships - there are three things here - a hint that there could be more scholarships added, that each conference could set its scholarship limits, and that scholarship amounts could be deemed part of the revenue share.
Without going too deep into anti-trust law (I don't know it at an expert level but have a good grasp on the legal concepts involved, and you don't want to read about it), it would be a really good thing if conferences decided to set their own rules on scholarships and revenue share amounts. Part of the problem with the anti-trust allegations has been that all the rules have been set from the top - the NCAA. The athletes had no options. If the conferences set some of their own rules, that removes the anti-trust problems. I mentioned this before regarding the SEC's spring transfer rules, which state that you can't transfer to an SEC school from an SEC school. Because players have other options, it takes away the anti-trust violations and that rule would likely survive a challenge.
So, let's say they decide to set the annual limit to somewhere between $17-$22 million, you could see some of this:
If schools can count scholarships as part of their revenue share (makes total sense), they could give out as many as they want up to the cap. If a school wants to give 32 to baseball, so long as Title IX is taken care of, they could do that. If they can figure out how to maintain a competitive balance, different conferences and schools within conferences can do things differently. This vitiates the anti-trust problems because players will now have options and can't complain that they are being controlled by the fact that all schools have to live by the same rules.
There is a really big IF there - how do you maintain that competitive balance? I don't know, but smarter people who are making way more than I am will figure it out. Plus, NIL has already scrambled this and made it uneven. Not to mention, it's never been even - there have always been haves and have-nots. Now, someone like Vandy can recognize they aren't ever going to win in football, do the minimum there, and then dedicate more money to baseball and basketball, where they can be more competitive. That may never happen, but if it does it will upset @BaronVonHeinsteidel greatly. jk, jk
I really like the scholarships being part of the revenue share. For athletes in sports that don't make money, that's all they should get. And that's a lot.
Other issues that have to be resolved - do they need a CBA under this model - I think they might be able to avoid that, although I think it is a good idea; do they make them employees - I think they avoid that with this model; how do you handle the transfer portal - maybe by profit sharing, and the fact that each conference can set their own rules might make that go away. A CBA makes it all go away, but we will see.
Sources: New college athlete compensation model may cost power schools $300M each over 10 years
The college sports industry is moving closer an athlete compensation system. At this point, it seems inevitable.
sports.yahoo.com
Sources: NCAA could pay $2.7B in antitrust suits
The NCAA's national office might be footing the bill for a settlement expected to be more than $2.7 billion in the landmark House v. NCAA antitrust lawsuit in hopes of reshaping and stabilizing the college sports industry, according to multiple sources.
