Money, Ethics, and College Sports

College sports are an important fragment of most universities. Athletics create a sense of community and pride for the schools and can ultimately lead to more applications and alumni donations if a specific sport performs well. Those sports in particular are male football and basketball teams. Many universities receive millions of dollars in revenue from television broadcast deals and merchandise sales for college football, and to an extent, men’s basketball. It is no wonder why the question of “should college athletes get paid?” is in discussion as well as currently being discussed in court.

One man who stepped up and voiced an opinion is former UCLA basketball star and NBA player, Ed O’Bannon. In July of 2009, O’Bannon filed a lawsuit against the National College Athletic Association pleading the department violates antitrust laws by using former and current players images, names, and likenesses for commercial purposes. What sparked O’Bannon’s reason to be a lead plaintiff was seeing his image in an NCAA video game that he was not compensated for. The O’Bannon v. NCAA case is fighting against the college organization and believes players should be compensated a fraction of the billions of dollars generated by college athletics from its huge television contracts. After six years the case has caused much controversy for the NCAA and universities. But just recently, some court decisions have impacted the case.

The NCAA has created multiple laws to keep college athletics as amateurism sports. This includes that all athletes cannot be compensated for the use of their name, image, and likeness while attending the university. If such actions are performed, punishments can be anywhere from losing playing time to being kicked of the team. For instance, during the 2014 football season, former Georgia player Todd Gurley was suspended from the team for four games because he made money off his own autograph. It even goes to as far as former players, like Ed O’Bannon, not compensated for their image used in video games authorized by the NCAA.

The NCAA is fighting for college athletes to receive no compensation beyond their scholarship because it would ruin amateurism status of athletes and goes against “eligibility” rules. Others argue paying players would destroy the moral purpose of college athletics and drive spectators away. But let’s not leave out a big factor here, money. It has been debated whether or not universities could generate enough money to pay athletes while also supporting them and contribute to other less popular sports. However, these concerns still leave out the main point. People are arguing that it is the athlete’s own name, and ethically he/she should be able to make money from it. Several college players have testified that the sport they play in college is their occupation and the many hours they devote to the game makes it difficult to function as a regular college student. An article from the Business Insider discussed one of the O’Bannon v NCAA trials over a year ago and how O’Bannon viewed his student-athletic career. “I was an athlete masquerading as a student,” O’Bannon said at trial. “I was there strictly to play basketball. I did basically the minimum to make sure I kept my eligibility academically so I could continue to play” (Dahlberg). This statement from the article demonstrates the commitment student-athletes have and why many are arguing for players to receive payment.

Recently some major decisions have been ruled in the O’Bannon v NCAA case. In June of 2014, a federal judge ruled that the NCAA cannot stop players from selling the rights to their names, images, and likenesses. This conclusion hit hard on the NCAA regulations which prohibit student-athletes from receiving anything more than a scholarship. The court suggested an idea that money generated from television contracts be put into a trust fund that college football and basketball athletes would receive after eligibility. The cap for the money would be up to $5,000 a year, and the most a player could make is $20,000 after four years. The NCAA of course disagreed with this statement and fought against it.

On September 30th, 2015 The Ninth Circuit of Appeals confirmed the districts court decision that the NCAA amateurism rules violated antitrust laws. This of course was a big gain for O’Bannon but was not a complete victory. The court went against the injunction that would have forced universities to pay athletes up to $5,000 dollars a year. However, schools now must cover full cost of attendance, which is food, rent, books, etc., on top of scholarship. An article from Sports Illustrated claimed that Judge Jay Bybee, one of three judges out of the panel, expressed concerns that cash sums past educational expenses would transform NCAA sports into “Minor League” status. However, many still believe the cost of attendance is not enough for college athletes whose universities negotiate billion-dollar TV contracts.

The situation does not end there. Even though O’Bannon did not win the trust fund debate, the Lawsuit is far from over and he is not the only one striking down on the NCAA. Shawne Alston, Martin Jenkins, and two dozen other former and current players argue that the cap of athletic scholarships and cost of attendance are not enough and violate antitrust laws. If the cap was demolished, Universities may be forced to pay student-athletes market price scholarships, which can extend up to seven figures. This litigation will be heard in the U.S. District Court for the Northern District of California soon. That being said, let’s look at the possible financial decisions college athletics and universities would consider if athletes were required to receive money.

To help understand the situation better, I sat down with USC Sports Information Director Jeremy Wu and discussed the conditions that have athletic departments in dismay.

According to Jeremy, the new ruling that declares that Universities must pay full cost of attendance, food, rent, books, and more, is the first strain on schools financially. Some schools already proved this for football, such as USC, but now are required for all sports. Other major and smaller universities are in the process of making this transition.

The money for funding full attendance does come from the ‘billions of dollars’ schools receive from television contracts. But what a lot of people have a hard time understanding is the money received from these contracts are not just supporting football, but an entire athletic program. “A lot of schools even with TV contracts don’t make more money than they lose” Jeremy said, “Even though contracts are huge, such as millions of dollars, funding a full athletic department is a lot and it is covering more than just football, but all the sports”. Jeremy also continued to mention the money generated from TV contracts pays coaching staffs for all teams and buys necessities for the sports.

Before we dig in deeper, here are some interesting facts from the article, Cracking The Cartel, that talks about where the money for athletics is going:

  • $156,647 is the median amount a division one school spends on a scholarship football player as of 2013
  • $14,979 on a full time non student-athlete
  • In 40 States, Football and Basketball head coaches are the highest-paid public employees

football

The facts above demonstrate the expenses universities spend not only on athletes, but college coaches. If athletes were to receive payments, the money spent on coaches most likely will decrease.

In order for the majority of universities to provide payment for athletes they would have to make some changes that would create a scale-back. The process would start with cutting smaller sports from athletic programs, such as golf or tennis. This leads to job loss not only for the people who coach the sport, but maybe a couple strength coaches, a nutritionist, and perhaps academic advisers.

From the article, Cracking the Cartel, it claimed one reduction in programs would be a drop off in athletic scholarships. Universities provide 85 athletic scholarships for football and that could shrink to 45, just like an NFL team.

Colleges could decide not to try and cut athletic programs all together. The programs who are most likely able to perform this financial event are the so-called Power Five conferences (the ACC, Big Ten, Big 12, Pac-12, and SEC), but even some say it may be too much and schools slowly would drop down to Division II. Jeremy discussed how small schools like South Dakota State, who don’t generate enough money off their athletic programs, would have no choice but give up its sports teams.

Even Title IX plays a heavy role and universities must still obey the rules that are enforced by it. If one women’s sports team is cut, then three men’s teams are cut as well. Title IX provides a unique experience for young female adults to receive an education and achieve an athletic career. Financial struggle to pay athletes would not only take this opportunity away from women, but men as well.

As a student-athlete myself, this situation definitely has me concerned. Though it is apparent that the NCAA needs to make some rule changes, paying college athletes certainly would transform intercollegiate athletics. If universities were to act on the most dramatic possibilities from this event, college athletics as we know it, would cease to exist.

Leave a Reply