The NCAA (Cash Cows, of course): But should the herd share in the profits?

There have been, both past and present, debates over whether the NCAA should be sharing some of the revenue it makes off the back of its’ players.

The big question before the court of public opinion seems to be this;

Why the heck are NCAA athletes not permitted to make a single dollar from merchandise, attendance, TV rights or even self-negotiated endorsement deals (to the point of facing tough sanctions, up to outright expulsion) when the league so clearly profits, handsomely at that?

First, we need to know; does the NCAA actually make money, and, if so, how much?

There’s no question that the NCAA makes money off the faces and efforts of its’ student athletes; how much, exactly, is open to conjecture (especially since the league, never mind individual schools, seem extremely reticent to speak directly to an actual amount.) Let me give you the gist, and let you fill in the remaining blanks; with CBS and TBS paying ten-point-six billion dollars a year for the basketball tournament alone, the league is certainly not poor.

Some closer-to-the-ground numbers; Ohio State‘s football program (just football alone) brought in $51.8m.  The top 50 programs in the country brought in an average of $22.1 million, at a profit margin of roughly 56% (source : Orlando Sentinel). Want to freak out? Texas brought in nearly $121 million!

Hold on a minute, though; according to the NCAA, only 14 schools (out of more than 1100 institutions) actually made money; there is no question that there is an absolutely massive – and increasing – gap between top and average programs, so please – take those numbers with a large grain of salt (preferrably one of those big blue salt-lick cubes they leave out in the fields). It costs a LOT to run more than a thousand schools’ athletic programs, and the NCAA doesn’t keep most of that money. More on that in a minute.

Over 100,000 paying fans at Michigan Stadium to watch un-paid players, does that seem right?

So where’s the money go?

According to NCAA President Mark Emmert, 96 percent of the $700 million the NCAA will make from its new broadcast contract will go to “member athletic departments in support of athletes.” I’d like to know if Mr. Emmert means ninety-six percent of the contract or the NCAA’s profit – big difference – but you don’t get hired by places like the NCAA if you don’t know how to spin your words correctly, do you?

No matter, really; since any monies paid back to players would come from the league’s profit, let’s allow him off the hook for now.

All right, then; so what of the players? Without them, there is no March Madness, no Bowl system, no NCAA at all.

According to Ramongi Huma of the National College Players’ Association, “The players are way more valuable (to the NCAA) than what their scholarship is worth.” Huma goes on to postulate that the average Division 1 football player would be worth around $121,000 per year, and the average basketball player worth closer to $265,000 per. If you extended those numbers outward and started looking at large programs (let’s take Duke, for example) you could make strong arguments for each player being worth high six figures to nearly a million dollars apiece (per year) to their programs.

To simply hand those players the cost of an education seems, on the surface of it, to be a gross undervaluation, bordering on outright ripoff or robbery, especially when you consider that most scholarships barely cover the costs of tuition and books.

NCAA head guy Emmert has been clear; “Paying student athletes is in no way on the table.”

Official Syracuse online shop, selling basketball jerseys with the numbers of their star players

Let me be clear; the top ten percent, those who are going on to a professional career in the sport of their choice, don’t need our sympathies. We can debate the merits of what pros make, but that’s an argument for another day – and probably another writer. Their university careers directly led to professional careers that will pay them at least six figures yearly, so, without question, they get compensated for their “free” time in college.

We also know that school boosters give gifts to the best athletes. Shelve that. Again, we’re not talking about the top ten percent. They’re going on to wreck their bodies on NFL, NBA, NHL and MLB fields. They’re on their own, and they’re going to be just fine.

This column is to put forth the case for – or against – paying the average  NCAA athlete more than the scholarship pittances they get.

Wait, though…how much DO they get? (Go on, guess, before I put the numbers out there…)

Tangibly, with 44% of all full-time undergrads paying from $8,244 (in-state) to $12,526 for out-of-state, (source http://www.collegeboard.com), you could argue that the direct financial benefit to the athlete is negligible, compared to what the NCAA obviously takes in.

However, most Division 1-A schools charge closer to an average of $36,000 per year – again, average, so many charge even more – so that’s not peanuts.  Some, dismissive of the athletes’ claims of poverty, point to such available funds such as the Pell Grant (up to $5,500 for students with lower-income parents), a $500 clothing fund and up to $11,000 in room and board; generally speaking, these “above-board” grants total out to less than $17,000 per student.

Some NCAA players go on to make millions upon millions once drafted into pro leagues

So, let’s go with the 1-A average of $36k, with another $17k in expenses possible – $53,000 per year legally. Does that cover? One quote to settle this one; SEC Commissioner Mike Slive recently said, “”I have long thought that we should revisit the limitations on the current scholarship model and perhaps expand it to cover the full cost of attendance. I look forward to that discussion.”

Translation? Holy cow, the guy who DOES see the numbers realizes that scholarships don’t begin to even cover the expenses of going to school.

So, let’s summarize;

– Only fourteen out of more than a thousand schools made a profit.

– Division 1 athletes have been (credibly and well-researched) found to be worth a minimum of $121,000 per year to their schools.

– Even with all the legal “extras” permissible, those Division 1 athletes could “earn” (including tuition) $53,000 per year.

– That leaves a discrepancy of $68,000 per athlete per year.

THE WRAP-UP

The big question, once you boil down all the little questions and facts, then becomes this; Do we think that the NCAA, and, by association (pardon the pun), its’ member schools, bring in $68,000 profit per student – and can we justify paying them that much?

The last time I looked, nobody’s packing 60,000 people into a stadium to watch me work. These athletes have a skill that people want to see, and are willing to pay from $47 (ACC, Big 12, Big East, Big Ten, Pac-12 and SEC cheapest adult single-game ticket) for each home game up to more than $190 (average) to watch the Round of 32 (never mind Final Four. That’s the territory of insanity and would skew the numbers badly.)

So, their skills justify $68,000 extra per year – if the money’s there. For 14 schools, it’s there for sure.

Now it just comes down to morality – should a student-athlete earn a piece of that pie?

That one’s up to you guys. I can’t wait to read the comments.

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7 Responses to The NCAA (Cash Cows, of course): But should the herd share in the profits?

  1. Brad says:

    You can’t post an article like this without explaining Title IX.

  2. Joseph says:

    players do get paid. Scholarships. They are there to go to school. Some who are great, only stay 1 year so the NBA and NFL can snatch them up.

    Title IX is a joke. Womens sports (and I’m not sexist) are draining the money. It’s going to get worse when the Big East teams will have to fly across country for games.

    Womens sports need to be more regionalized (if thats a word). No reason to drive/fly 8+ hours when you have equal competition 2 hours away.

  3. Jason says:

    “players do get paid. Scholarships. They are there to go to school. Some who are great, only stay 1 year so the NBA and NFL can snatch them up.”

    Clearly Joseph, you didn’t read what the entire article said. As in “Holy cow, the guy who DOES see the numbers realizes that scholarships don’t begin to even cover the expenses of going to school.”

  4. Harrison says:

    It’s unfair to student-athletes when the NCAA and member schools earn incredible profits on their backs without monetary compensation. It would also be unfair to other students if schools were to pay student-athletes just for playing a game. The solution is to go back to the origins of sport in the university: eliminate national championships, ban player names on uniforms, make all university sporting events free to attend, and ban all television contracts. If the sports weren’t so incredibly blown out of proportion in perceived importance as they are now by the media and the NCAA itself, then the profits will dry up and we’ll be back to what college sport was intended to be – an extracurricular activity meant to build character and teach life lessons to students who choose to participate, so that they will be better prepared for the real world that 90% of them will enter after they graduate. Of course, the universities and the NCAA love money too much for this to happen.

  5. Mark says:

    If I’m going to speak to Title IX, then I must also speak to the Javits amendment. Right?

    I assume that nobody here is actually complaining about Title IX. In my extremely non-humble opinion, women are entitled to the exact same consideration as men, period, full stop.

    Equality means just that, and I’m only ashamed that we actually NEED something like the Mink Act to LEGISLATE something that should simply be common sense.

    When it comes to the distances women’s teams travel, that’s not a Title IX argument, that’s just bad logistics and an abject lack of common sense, something the academic world seems to have a pretty good handle on universally.

    In any case, what it comes down to, as Jason pointed out, is that even the top guys understand that scholarships just don’t cover the cost of education for the average student-athlete.

    I did make great pains to exclude those star athletes; thanks for noticing, Jason. When it comes to this scholarship issue, I’ve got no sympathy for those who go on to pro careers.

  6. RP Sports says:

    It’s a complicated issue. I’ve always looked at football and basketball at the “major” schools subsidizing all the other intercollegiate sports their university may offer. And with title IX, you have a lot of womens sports that must be offered as well. Are there any womens teams that bring in $??(maybe UCONN Basketball) Sure all the money that’s being made is on the backs of the football and basketball players, but it seems to me the NCAA and the member institutions would rather see the revenues generated by the athletes being plowed toward the swimming,tennis,soccer,gymnastics, and water polo teams rather than the athletes themselves. Which would be fine if the athletes were able to get a job like any other college student, but considering the fuss put up by the NCAA to OSU when Terelle Pryor sold his jersey for tatoos, it looks like the corrupt system is gonna stay corrupt. I’m sure it’ll change eventually (no corrupt system lasts forever) but it may take a long time.

  7. Brad says:

    Mark- you are selling half a story when you make it sound like that money just goes into a football or basketball vault with no other place to go, that is why I brought up title IX. You can’t pay the boys, without paying the girls.

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