A Bite To Eat: Compensation for Student-Athletes

Last Monday, University of Connecticut Huskies defeated the Kentucky Wildcats 60-54 in the NCAA Tournament Championship to bring UConn their second title in four years.

Leading the charge was Senior Guard Shabazz Napier. Being a four-year college athlete, and an old man by NBA standards at 23 years-old, doesn’t help his draft stock. But something says he wasn’t ready to leave the collegiate level just yet when he was interviewed by reporters after the game.

After winning the championship and the tournament’s Most Outstanding Player award, Napier used his fifteen minutes to address something he feels very strongly about: compensating college student-athletes.

Compensating the so-called “student-athletes” has become an oft-debated topic because there appears to be no straight-forward solution. From the biting satire of Jon Stewart to the thoughtful, analytical perspective of Pablo S. Torre, it’s an issue that’s gaining traction.

I used to be against compensation.

I was against it mainly because, as a high school senior, I am looking ahead at college and seeing a mountain of debt payments and financial obligation. If you give money to the athletes through a stipend – no matter how small – it affects Mr. Regular American and their ability to get a better education. For every $2000 (the most common suggested figure) that a University gives out to an athlete, it’s taking away $2000 or more from a potential student.

An average school in college’s Big Ten Conference awards more than 280 scholarships annually, ESPN found. Essentially, for an average Big Ten school, they now have $560,000 less in financial aid if they pay the stipend. Committing that money elsewhere other than to their students who can’t run quickly or throw a long bomb is irresponsible. It decreases the credibility of that University because it puts athletics over academics in our society which already has enough problems doing that. $2000 per year is a lot of money – it could decide a child’s future in college – and to take that from a regular student to give to an athlete is absurd.

I used to be of the opinion that since student-athletes were getting incredible educational opportunities for free through their scholarships and that was enough.

But, getting a great education isn’t always the case. Take the University of North Carolina at Chapel Hill. Consistently rated as a top-five public school in the nation by US News and World Reports as well as Forbes, athletes that attend UNC should feel blessed to do so. I used to think, “With that scholarship, they get to go there for free, get an amazing education, and play football.” I justified football as an ultra-intense, yet financially rewarding work study. A work study that paid for your whole education.

UNC created fake classes for athletes, termed “paper classes,” which required no attendance and a mere 10-sentence paper at the end of the semester. This one received an A-. This wouldn’t pass a high school Freshman English class.

If the students received a good education – IF – then I would have no problem with scholarships being their only financial aid, but UNC helps us know the education argument is bogus. The University cares about its students so little that they created fake classes so no one would know that they were fully taking advantage of these kids. They exploited them to make money by packing the stands for Saturday afternoon football. A scholarship is an agreement advantageous to both sides, and one of the sides was betraying the deal.

Schools are at fault here. ESPN only carries profit/revenue charts from 2008, but look at 29th-ranked North Carolina’s profits. $66,148,186. $66 million of revenue and they provided their students with paper classes. Student-athletes bring in every penny of that $66+ million for their school – it’s all off athletics. Kemba Walker single-handedly carried the UConn Huskies to the 2011 Championship and received nothing for it. We don’t know about his education, but if the possibility for other schools to run a UNC-like gambit, then the system is broken.

If a University pays a player to attend a University (by giving them a scholarship), yet does not provide them with an education, does that not mean the scholarship is a salary? Isn’t a salary for an employee? Does that not mean that the college paying the player for producing revenue is just an employer-employee relationship?

Earlier this month, the National Labor Relations board ruled that a group of Northwestern football players were employees of the university before they were students and therefore legalized the option to unionize. Working 50-60 hours per week on the football field, being forced to skip required classes because of their conflicts with football practice, and the revenue they bring to the university led to that decision.  That court decision has now set a precedent that many universities may now have to face.

The system of “student-athlete” is broken and it needs to be fixed.

Asking colleges to take money from their internal funds is wrong because it hurts regular students. Asking athlete’s to take a pay-cut is wrong because they may not be able to attend the college without a scholarship.

Initially my thought was to take the money from the 14-year, $10.8 billion deal between the NCAA and CBS and Turner Sports to broadcast the Men’s Hoops tournament. But, the NCAA expects more than $740 million to be distributed to its members annually through 2024. That money that the NCAA gives to the schools essentially goes toward the scholarships that the school can provide.

That same tournament that makes so much money for the NCAA helps the schools as well. TIME Magazine reports, “$639 million: Estimated value of the publicity and exposure Butler University received during the Indianapolis school’s run to the 2010 tournament final; after making it to the championship game [in 2010], applications to Butler increased 41%.”

So the schools are helped, the NCAA is helped…who helps the athlete who makes all this possible?

Even if we wanted to pay the players, how?

In 2011, ESPN’s Mark Schlabachfollowed the money from the turnstiles back to the universities in a comprehensive look at how a non-profit divvies up the money. Most of the wealth is put back into the colleges. Even as an organization, the NCAA takes only 4% – or $30.6 million – for all staff budgets and salaries. (“Only” being a loose term here.) The NCAA and the NFL are both 501 (c)(6) non-profit organizations so their money must be funneled back into the system. It would seem the money is being funneled.It would seem as if there’s no money left anywhere.

But wait. Maybe there is.

USA Today reports that the NCAA had nearly $872 million in total revenue in fiscal 2012, according to the financial statement, and nearly $801 million in total expenses. In 2011, it had nearly $846 million in revenue and $778 million in expenses.

The NCAA had nearly $72 million in surplus in 2012.

There’s the money! Why can’t we take the surplus and spread it to the programs in the NCAA – of which there are 1,281 – by giving them the surplus that they earned? The NCAA can even institute a weighted payment plan that rewards universities for their performance in the previous year’s season.

As of now, those surplus funds go towards, “the endowment fund. [It] has been designated as a quasi-endowment, which means the money is intended to be retained and invested, but unlike a permanent endowment, its principal can be spent. It was established in 2004 by the NCAA Executive Committee, a group of college presidents that oversees association-wide matters, primarily to protect against an event that could impact what is overwhelmingly the NCAA’s greatest revenue source: the Division I men’s basketball tournament” reports Steve Berkowitz.

The money is being placed into a program that insures the NCAA Men’s Basketball tournament won’t fail? What type of “event” could make it fail? 176 million people tuned into the 2012 tournament and the number is growing every year. That tourney was followed by 2013’s which averaged 10.7 million viewers throughout March and April, up 11 percent from 2012, and marking the most-watched NCAA Tourney since 1994. 2014 was even bigger. They do not need this pile of cash sitting around in a “quasi”-trust.

Putting the money into a quasi-trust is essentially taking the money away from the players for no good reason.

That is why giving the kid’s the surplus is the best option. It takes away from no one, it hinders no one’s bottom-line except positively for the kids! It’s a surplus for a reason! It gives the kids incentive: play well and there’ll be more revenue – more compensation – because of a larger surplus. It’s simple economics that everyday businesses use and the NCAA is a business!

How is it a business? They used to produce video games that clearly played on real teams with real players. When Pat White played for West Virginia University, he was an exciting, fast, triple-option oriented Quarterback. When I went to a friend’s house, I always used WVU and “Pat White” or – as the game dubbed him – QB #5. QB #5 had an eerily resemblance to White: left-handed, fast, the number…

"QB #5" and Pat White

“QB #5” and Pat White

That brings the Ed O’Bannon case in, where the NCAA took in even more profits than those surpluses and even more from the school in tee-shirt sales and video game production. There are no records available which give specific dollar amounts, but the fact that players whose likenesses were being used and players who helped contribute to the tournament received nothing.

As of May 8, 2012, men’s college basketball accounted for 78% of the NCAA revenue, according to Statistic Brain. No payment from any surplus is an egregious wrong that the NCAA is doing to its athletes.

UConn Huskie Shabazz Napier spoke to that in his interview.

“We do have hungry nights that we don’t have enough money to get food in,” Napier said in the interview. “Sometimes money is needed.” That is the struggle every college student must deal with. We shouldn’t dote on them just because they’re athletes, but we shouldn’t provide them a poor education and demand 50-60 hours per week without compensation either. College kids all have debt, all need food and a job and a car whether they play basketball or not.

Napier admits he doesn’t think it should be a large sum. “I don’t think you should stretch it out to hundreds of thousands of dollars for playing, because a lot of times guys don’t know how to handle themselves with money.” With that being said, the surplus of $72 million, spread among the 420,000 NCAA athletes would mean a small stipend on the table for these athletes, it makes sense. It takes away from no one and gives back to the athletes who make the sports spectacles possible. The one’s that we love so much and the one’s we spend hours watching.

If you don’t like the surplus option, there is another choice. What about allowing athletes to sign advertising deals and allow companies to sponsor them? It allows a kid to make revenue while costing an educational system nothing and using only his own name. Isn’t it an American principle that one should be able to make money off their actions and their name?

That would make the Johnny Manziel scandal of selling autographs or Terrelle Pryor’s bit about trading autographs for tattoos, obsolete. As it should be. Manziel made money off his own name and doing his own business with a private, third-party company. Why does the NCAA have to regulate that?

Uber-touted Freshmen Joel Embiid or Andrew Wiggins or Jabari Parker could have signed endorsement deals and made money this year without disrupting the flow of cash from NCAA to universities. Where is the harm in a business taking a risk on a young entrepreneur when it comes to an investment? That’s another American principle: a free market.

Endorsements encourage young players to behave as well as they play, so their marketability goes up, and gives them the chance to make money as well as play basketball for an esteemed college, building skills that they need to succeed in their future endeavors. Sounds exactly like any other college student. Maybe even a regular student could make money off an internship in the summer. College basketball players can’t even do that.

Give them the opportunity to guide their own destinies. Allow them to make money for themselves away from the NCAA, the only place that still touts these kids as amateurs. Let them live the American dream.

I used to think that paying collegiate athletes was a sham. Now I realize the real sham of some university’s saying they give these kids a free “education” in exchange for their services playing sports.

If it’s done in the right way, with the right funds, paying collegiate athletes is the right thing to do.

So while the gluttonous NCAA sits at the table and refuses to toss even the athletes some scraps, the rules need changing.

The student-athlete needs a bite to eat.


3 thoughts on “A Bite To Eat: Compensation for Student-Athletes

  1. The other key thing to remember are the bonuses paid out by the NCAA to schools, coaches, and the AD’s. Coaches & AD’s get “bonuses” paid from the NCAA for winning conference tournaments, making a bowl, the NCAA tournament, etc… these are – at least in the power conferences – coaches who make million + contracts & AD’s who make 7 figures too. So a $100,000 bonus to a basketball coach making $3million annually… that’s $7,000 per player on a 14 player basketball team. Tell me the motivation to train harder, perform at your best, be coachable would not go up knowing you (the player) have the chance to net $7k for playing hard? Add on the AD bonus of $75K – and now that athlete could make $12k…

    • Absolutely fantastic point. 40/50 states have either the football or basketball coach as highest paid public employee, as well. They wouldn’t be hurting by losing their conference tournament bonuses. Great point.

  2. Pingback: 100 Weeks of “Purely For Sport” |

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