There has been some big news in college football over the past month which necessitate a closer look at one of the hottest topics in the world of collegiate athletics: Should college-athletes be paid for their services to the school?
This is a very touchy subject for obvious reasons and my wish in this post is not to argue in favor of, or against one position, but rather to lay down as many of the fundamental issues to allow you, the reader/fan, to formulate a well thought opinion. After all, ultimately neither you nor I will have any say in the matter, but being appraised of all the facts never hurt anybody.
The topic of compensation for athletes has exploded recently due to the revelation that big time football stars like Terrelle Pryor received gifts for autographs and memorabilia, either monetarily or with certain perks like cars, free tattoos, etc. Couple this with the highly explosive article published on Yahoo! Sports, indicating that former ponzi-scheme broker, Nevin Shapiro (who is serving time in federal prison) provided all kinds of benefits for students at the University of Miami, particularly football players, and you can see exactly why this topic is here and here to stay.
There are many respected, knowledgeable people in the sports world such as ESPN's Jay Bilas, who argue that athletes should be compensated for their services. This is a significant discussion point for football specifically as, much like in the 'real' world, football is king. As wildly popular as college basketball and the NCAA tournament are, football is the real revenue generator behind any successful DI program and most other sports depend on the health of the football program to provide for them. Football is the cornerstone species in the collegiate sport eco-system. Coincidentally, football is often the most difficult of the sports for a school to sustain, and it is almost impossible to do so without the help of various boosters and the funds they provide/set up. The most glaring problem in the NCAA today is that there is little to no equity. Some schools have very deep pockets, some schools have a little cash to throw around, but most schools have Athletic Departments in serious debt. In 2009, only 14 of the 120 Division I football programs were in the black, down from 25 in 2008, with most universities subsidizing (read: giving) an average of ten million dollars to their athletic programs to help keep them afloat.
So the next set of answers needs to address two fundamental questions: Where does the money come from, and where does it go? AD's get their money from three main sources. More than fifty percent of the total comes from a combination of ticket sales (~20 %), alumni/booster donations (~27%), and from revenue sharing (~15%). So basically, the money comes from fans, fans with lots of money, and TV. AD's spend their money mostly on two categories, which also account for over fifty percent of the total. Salaries and benefits (~32%) and scholarships (~25%). In order the alleviate the pressure on their AD's many schools have resorted to cutting less profitable sports, many of which are women's athletics.
For a little snapshot of what these numbers looked like in 2009 (2010 data not yet available) I've provided this little chart of aggregate revenue vs expenses in the ACC, broken down into a few sports.
ACC Revenues by Sport
Men's Women's Total
Basketball $133,479,911 $13,783,701 $147,263,612
Football $250,773,784 x $250,773,784
Lacrosse $2,819,862 $3,116,705 $5,936,567
Total (ALL) $420,234,244 $61,760,634 $481,994,878
ACC Expenditures by Sport
Men's Women's Total
Basketball $69,471,020 $31,673,597 $101,144,617
Football $178,200,816 x $178,200,816
Lacrosse $4,430,138 $4,848,133 $9,278,271
Total (ALL) $311,292,639 $113,798,555 $425,091,194
To further break these numbers down, let's take a look at my Alma-Mater, the University of Maryland.
Total Revenues by Sport
Men's Women's Total
Basketball $10,739,282 $861,059 $11,600,341
Football $11,540,368 x $11,540,368
All Sports* $2,185,847 $3,738,644 $5,924,491
Grand Total** $51,641,771
*= not including football and basketball
**= including total revenues for men's and women's teams plus competitive cheer, this total would become $52,007,095
Total Expenditures by Sport
Men's Women's Total
Basketball $5,160,381 $2,158,656 $7,319,037
Football $9,863,748 x $9,863,748
All Sports* $5,399,723 $7,502,775 $12,902,498
Grand Total** $51,418,347
*= not including football and basketball
**= including total expenses for men's and women's teams plus competitive cheer, this total would become $52,007,095
Depending on the baseline you use, the Terps AD made $0 or $223,424. Either way, not a whole lot of money. Compare this to the University of Texas, whose football team generated almost ninety-four million dollars. After subtracting football expenses and adding/subtracting all similar costs to Maryland (including their women's programs which lost the school eleven million dollars), the AD at Texas generated $29,603,034 in profit. Let that sink in for a bit.
So why were all those charts and numbers important? Simple. Based on the numbers, it's apparent that a Cam Newton or a Landry Jones are basically twenty-million dollar assets walking around campus. Your John Walls and Derrick Williams are somewhere in the 5-7 million dollar range. There's no denying that athletes in the two major sports are mega money producers for the school, yet they aren't allowed by the NCAA to profit from any of the revenue associated with them. If you take the average investment of an institution ($76,000) for an athlete, and an 85 man limit on football scholarships, one Landry Jones pays for three times the number of players on the team. The problem is, most schools don't have a Landry Jones. As noted earlier one of the fiercest proponents of the pay-for-play system is Jay Bilas. He has a very simple and fundamentally sound argument about why athletes should get paid. Bilas argues that the NCAA is artificially suppressing the market (which is true) and denies athletes the ability to capitalize on their talents the way schools allow other students to do (also true). A music student on full scholarship can go play at any event he or she wants and is allowed to keep any money they get as a result of their performance. A student on a merit-based full scholarship is allowed to reap the benefits of his or her talent in the everyday marketplace for whatever a company is willing to pay them as well.
The question now becomes, who pays them? As you can extrapolate from the data, it would be highly impractical for most AD's to pay their athletes. They simply don't have the money. The answer then becomes individuals. If a fan wants to pay John Brantley $2,000 for an autographed jersey, why should we stop that? If a local car dealership wants to hand the keys of a $50,000 automobile to Marcus Lattimore, have at it. Opponents of this notion point to a question of fairness. The star quarterback is going to make 20x more than an offensive lineman. The offensive lineman will make 100x more than the water-polo player. Proponents accurately note that fairness is subjective. The realization is that, quite frankly, the quarterback, intrinsically, is worth 'more' to the school than the water polo player, and it's because of the quarterback that water-polo even exists. They also note that the BCS system itself is skewed: In 2011, of the $174 million generated by five bowl games, almost 85% was split between six major conferences. As vociferous backer of this play-for-play system, Mike Wilbon, points out, "That's right. Football and men's basketball players get paid; lacrosse, field hockey, softball (etc.) players get nothing. You know what that's called? Capitalism. Not everything is equal, not everything is fair." Point taken. Mr. Wilbon also goes on to comment that the inability to distribute funds equally is "an excuse, a rather intellectually lazy one at that." While on the surface that may be true, Mr. Wilbon seems to have forgotten that what he deems 'intellectually lazy,' happens to fall right under the pesky clause of Title IX in the Civil Rights Act. Although you mainly hear Title IX applied in the context of women's sports, it is a guarantee that "no person shall be excluded from participation in...or subjected to discrimination under any education program or activity receiving Federal financial assistance." It is certainly conceivable that a rather substantial discrimination argument could be formed underneath the shield of Title IX and since every single state school receives at least one dollar in Federal assistance, and athletics fall under 'activities,' there is no conceivable way that a non-private school could shake a ruling in favor of Title IX.
Another argument for paying athletes is that, as most of them do undoubtedly come from low income areas, they need the extra money. Rather than depending on agents or other nefarious characters to supply them with money, this would legitimize them to take advantage of their skills and earn them extra money. The counter argument is, do they really need it? Proponents note that full scholarships pale in comparison to the amount of money star athletes make. But in reality, football players as a whole get way more value for their scholarships than a regular student. For example, most football players receive a combination Pell grants, clothing funds, etc for a value of $17,000 per year. Furthermore, according to reports published by SEC Commissioner, Mike Slive, while an in-state (non football) student at the University of Arkansas gets about $50,000 worth of scholarship over a five year span, an in-state football player would receive $135,000. For out of state students, that number increases to $193,000. Not equal to millions, but more than the average student.
The biggest objection to paying student athletes is equity among institutions. There is already a huge gap among the haves and have-nots in college football, and opening outside money influence will absolutely skew the funnel toward schools that have the financial backing. It's no secret that many of the best programs already have "un-sanctioned" methods for attracting top talent to their universities, all this does is take the stigma away from it. How are smaller teams like Maryland, Boise St., Northwestern, etc. supposed to compete with Texas, Fla St., and Ohio State? If a school can barely keep its AD afloat with a marginal football team, how is it supposed to compete if the best teams it competes against get that much better?
There is no doubt that the NCAA keeps its biggest revenue producers from getting a slice of the pie. The problem is if the pie is really worth the headache. You decide.
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