(Photo by Andrew Gearhart/Unsplash)
While the NCAA technically has rules over who can officially recruit players on their schools’ behalf, there’s enough wiggle room for collectives to have an outsized impact. The University of Miami, which sent both its men’s and women’s basketball teams to the Final Four last season thanks in large part to transfers lured by collective-tied NIL opportunities, has become intertwined with the fate, whims, and cash of super-booster extraordinaire John Ruiz, a university alumni and founder of LifeWallet. To nearly everyone, the connection between the collectives’ cash and athlete recruitment has become explicit.
“We’ve got to be able to offer a package similar to those other places so that money does not become a factor,” Penn State head coach James Franklin said to boosters at a recent $2,000-a-ticket fundraiser, according to the NYT.
Already, the IRS is beginning to scrutinize alumni collectives, arguing that they stretch the very definition of nonprofits and charitable organizations.
Pay for Play: Still, it’s not just the IRS that’s skeptical of the new booster-dominated system.
While being sure to tip-toe around criticizing the NIL opportunities writ large, Alabama football head coach Nick Saban recently told Sports Illustrated that “Guys are going to school where they can make the most money. I don’t think that is even the best thing for the player,” adding that “the whole concept of collectives is what has created this environment that we are in, and I’m not sure that anybody really had the insight or the vision to see that was going to happen.” Five of Saban’s players rank among the top 100 most paid in all of college sports, according to data compiled by On3.com. Saban earns roughly $10 million a year as head coach.
Others are more explicit: “[The collective system is] a pay-for-play scheme disguised as NIL,” Big Ten Conference commissioner Tony Petitti said at a Senate hearing in October. “We are concerned that management of college athletics is shifting away from the universities to collectives.”
Touchback: If NIL is defined by an opaque system of shady backroom payments, the simple solution may just be to pay student-athletes directly as university employees. And that’s what some student advocates would like to see:
California Dreaming: Most onlookers look to two separate movements as the most likely to radically reshape athlete compensation once again.
The first is an antitrust lawsuit brought by three former NCAA Division I student-athletes, House v. NCAA, that aims to use the NIL ruling against the NCAA. Essentially, the plaintiffs argue that the games themselves are the most essential uses of players’ name, image, and likeness — opening the door to a more direct revenue-sharing model, where players would likely be classified as employees of their universities.
“What we’re going to be asking the court to do for the class is to strike down all current prohibitions on NIL. And so the most significant is the rule that prohibits conferences from paying students for NIL,” said Steve Berman, one of the lead plaintiffs’ attorneys.
The second is California’s College Athlete Protection Act, which passed the state assembly and would require its state universities to create a revenue-sharing system with student athletes. The law would establish a system in which schools would share with athletes revenue that exceeds its total revenue from the 2021-2022 school year.
In 2019, California signed the nation’s first legislation allowing athletes to sign NIL deals — despite threats from the NCAA that its schools would be excluded from competition if the legislation passed. Instead, other states drafted similar NIL bills, kicking off a chain of events that culminated in the 2021 Supreme Court ruling. If passed, California’s revenue-sharing model could similarly inspire a wave of imitators, ultimately leading to system-wide change.
Many athletic departments are already penciling in major changes, Casey Schwab, chief executive of college sports advisory firm Altius Sports Partners, told The Wall Street Journal. “This moment in time right now feels like the fall of 2020, nine months before NIL went live,” Schwab said. “We’re nine to 12 months away from that next moment of panic in college sports.”
|