N.C.A.A. Proposes Uncapping Compensation for Athletes

A plan by the N.C.A.A. for a series of reforms that includes uncapped compensation for athletes could help address the growing inequities of a system in which sports like football and men’s basketball generate billions in television and other revenue yet share a minuscule amount directly with the athletes.

In a sharp break from his organization’s past, the N.C.A.A. president, Charlie Baker, on Tuesday called for a series of changes paving the way for the top moneymaking schools to break away and form a division that would more closely resemble professional sports.

Baker’s proposal, in a letter to the 362 Division I member schools, also called for reform of so-called name, image and license payments so that women athletes could reap greater benefits, and he wrote that the overhaul would help the N.C.A.A. seek shelter from antitrust lawsuits.

Baker’s plan, while far from an edict, serves as a directive for college presidents and athletic administrators who make up the N.C.A.A. governing boards that write rules and present them to the member schools for approval, a process that requires nearly a year to approve even the most picayune changes.

The National Labor Relations Board is hearing two cases in which athletes are asking to be classified as employees, and there are several cases winding their way through the courts that charge the N.C.A.A. with violating antitrust laws. A bill in the California legislature would make revenue sharing with athletes compulsory.

Baker, the former governor of Massachusetts who became the president of college sports’ governing body in March, proposed that schools set aside educational trust funds of at least $30,000 per year for at least half of their athletes, but added that they would have to comply with Title IX laws, which dictate that there must be equal opportunities for men and women.

“I think it’s historic that until today, the N.C.A.A. has never advocated for unlimited amounts of money to be paid to players,” said Ramogi Huma, the president of the College Athletes Players Association, who has fought for more than a decade for players’ rights. “They’ve always said that doing so would ruin college sports. This is an admission that doing so is practical.”

In his letter, Baker framed his proposal as a new starting point of a discussion that has befuddled leaders of an organization with agendas that are as disparate as their budget lines. (Ohio State, for example, reported $252 million in revenue last year, while it’s neighbor, Ohio University, competed for the same N.C.A.A. championships on just over $29 million in revenue.)

“Now the hard work begins,” said Dan Radakovich, the athletic director at the University of Miami.

Over the past decade, the N.C.A.A. has been compelled to loosen its once ironclad amateurism strictures. It removed restrictions on how much athletes could be fed after Shabazz Napier, a basketball player at the University of Connecticut, told reporters at the 2014 Final Four that he went to bed hungry sometimes. It had no choice but to allow education-related payments to athletes after an emphatic Supreme Court defeat in the Alston case, which challenged N.C.A.A. restrictions on noncash compensation. That defeat also compelled the N.C.A.A. to stand down from contesting state laws that challenged its authority to prevent athletes from making money from endorsements. In the past few years since Alston, there have been 10 congressional hearings related to the future of college sports.

More recently, the $75 million buyout that Texas A&M is paying its fired football coach, Jimbo Fisher, has further underlined questions about why some of the money that goes to exorbitant salaries, bloated staffs and opulent facilities isn’t shared with the players.

“I would take less money for the players to have a share,” Jim Harbaugh, the Michigan coach, who with incentives could earn close to $11 million this season, said recently. “I hope other coaches would use their voice to express the same thing.”

Baker’s proposal might not be classified as standard revenue sharing, but since he is not proposing any restrictions on how the athletes can use the money in the trust fund, it may essentially be the same.

“Revenue sharing is semantics,” Huma said. “If a school has full discretion of paying players however much they want, what does it matter? I didn’t see any restrictions on the source of the revenue. It can come from donors or TV revenues.”

Some athletes now make six-figures through endorsement deals. But since the rules went into effect in July 2021 allowing for N.I.L. payments in the wake of the Alston case, there have been few rules governing these deals — only that the schools could not directly be involved in procuring them.

The result has been a chaotic, unregulated industry that, in conjunction with loosening transfer restrictions, has created an environment where athletes hopscotch from school to school based largely on where they will be paid the most endorsement money. (Not coincidentally, the three leading Heisman Trophy candidates are transfer quarterbacks.)

An unintended consequence has been that a vast majority of the money has gone to football and men’s basketball players. Baker is proposing bringing N.I.L. deals in-house, which would place Title IX requirements on them.

College athletes have not been the only ones on the move. So, too, have university athletic programs, with schools bolting conferences, lured by the riches of television contracts for football. The Pac-12 Conference will be down to two schools next year, Oregon State and Washington State, with the remaining West Coast schools joining the Big Ten and the Atlantic Coast, leaving their athletes to make repeated cross-country trips to play conference games.

Baker’s proposal seemed to open the door for schools to reconsider their place in the athletic hierarchy. Purdue, for example, has 608 athletes. Paying at least half of them $30,000 would require the school to set aside $9.1 million a year to go into educational trust funds. But there may be little preventing Michigan, for example, from paying all its athletes double what Purdue might pay. Michigan generated $95 million more in revenue last year than its Big Ten neighbor.

Still, despite the resource gaps, administrators with smaller schools expressed reticence about not being in the top level. “Subdivision is a trigger word,” Gloria Nevarez, the commissioner of the Mountain West Conference, said at a Sports Business Journal conference on college sports in Las Vegas. “What does it mean?”

Baker wrote that his proposal “kick-starts a long-overdue conversation among the membership that focuses on the differences that exist between schools, conferences and divisions and how to create more permissive and flexible rules across the N.C.A.A.”