The NCAA Paying Their Athletes Doesn’t Add Up

By Will Hardin
Reading Time: 5 minutes

One of the most fiercely debated topics in the modern sports world is whether or not college athletes should be paid. Playing sports at one of the highest levels in the world is very time consuming, and the debate continues on whether athletes should be compensated for their performance at this level. Athletes spend countless hours practicing, training, and watching film, all on top of the demands of being a student. While these student-athletes grind away without making a penny beyond what their scholarship offers, the schools they represent are making millions of dollars off of their services. How can a high school football player be required to go to college for a minimum of three years before profiting off of his abilities? Why do elite basketball talents have to spend one year in college and forgo the millions of dollars they could make in the one-year gap between high school and the NBA? Those are increasingly important questions to the future landscape of the NCAA, television networks investing billions of dollars into college sports, and college athletic departments across the country.

Despite all of that, here is the simple answer to this dilemma: when looking into the business behind college athletics, it is easy to realize that it is not fiscally possible to pay the student-athletes. While there is an incredible amount of money in college athletics, there is simply not enough to pay the student-athletes. If college athletes were to be paid, where would the money come from? In a world where college athletes get paid, the only sports that would be supported by universities across America would be Division I football and men’s basketball. In reality, “only a fraction of the programs are profitable while most operate at a cost to the institution” according to U.S. News. This means that the revenue from the major sports, such as football and men’s basketball, is used to fund other sports such as baseball, swimming, track and field, softball, and any other sports a university offers. As a result, non-revenue sports would be scrapped because there would be no way to pay for equipment, coaches, and trainers, not to mention the players. The only sports that would survive would be the ones that can support themselves.

When looking at the athletic department revenues of the 230 NCAA Division I Public Schools for the 2015-16 school year, it is apparent that the schools do not have the financial resources to pay everyone. Many schools make enormous amounts of money, but in order to create this revenue, their costs are also incredibly high. To conduct this study, net revenue was used, which was calculated by subtracting the total Expenses from the total revenue. The data also gives the total allocated, which is money allocated to athletics from student fees, institutional support, and state funding. The total allocated is already included in the total revenue, but it serves as an interesting category to see which schools receive no external funding. Of the 230 Division I public schools, 102 either recorded a loss or broke even. The remaining schools recorded positive net revenue, but only 19 schools had net revenue greater than five-million dollars. Texas A&M University had the largest net revenue, making an astounding $57,286,676. However, this number is an outlier. The next largest net revenue was recorded by the University of Oklahoma, which made $23,104,876. From there on, the numbers start to dwindle. The massive amount that Texas A&M made can be contributed to the renovations of Kyle Field, their football stadium. When the new stadium was completed in 2015, there was an influx of donations leading to an increase in ticket sales.

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If collegiate football players were to be paid, the players at Texas A&M would have received $545,587.39, assuming a 105-man roster. This number was calculated by dividing the net revenue by 105, which is the maximum number of players a team can roster before the first day of classes. This is a significant amount of money, but it doesn’t accurately represent what would be happening for the rest of the colleges in the NCAA. For example, football powerhouse Ohio State University recorded a net revenue of $3,978,747. If this was split between the players, each would receive $37,893.83. This also would do little to exhibit fairness as Ohio State has outpaced Texas A&M in the final AP rankings in every year since 2011.  Additionally, this number is before taxes. According to Chris Plonsky, the Women’s Athletics Director at the University of Texas, the compensation the players would receive for playing for a school would be taxable just as money from any other job. On top of that, Plonksy says it is likely that players would have to join a union, in which union fees must be paid every year. Under the current scholarship based system, scholarship money and stipends are tax free.

While some schools theoretically could pay players, what about the schools that recorded zero net revenue or took a loss? Some notable schools that broke-even include UCLA, the University of North Carolina, and the University of Maryland. Meanwhile, Virginia Tech, Cal Berkeley, the University of Arizona, and the University Washington were all in the red. Cal recorded the largest loss of any school at an overwhelming $21,728,746. When premier schools are recording losses or barely staying afloat, how will there be money to pay their student-athletes?

In the scenario that football players were to be paid only if their school made money, it would be disastrous for college football; it would eliminate all competition in addition to likely lessening the total amount of scholarships offered as colleges and universities would look to cut their losses. The teams that bring in the most revenue would be able to pay players, thus making their program more attractive. This would lead to recruiting essentially becoming a bidding war of which school can pay the student-athlete the most money. At the end of the day, there would be only a handful of teams that would win championships each year. In 2015, the top five most valuable football teams were the University of Texas, the University of Notre Dame, the University of Tennessee, LSU, and the University of Michigan. These teams would always be competing for championships and schools who don’t have as much revenue, like Clemson, would be predictably average every year. Even though Clemson was the runner-up in 2015 and champions in 2016, their 2015-16 net revenue was only $1,763,077. If they split this up between their football players, like the example with Texas A&M and Ohio State, each player would only receive $16,791.21.

Luckily for student-athletes, the NCAA has recently lightened regulations on what student-athletes may receive from their universities. As of August 1, 2015, “the average student-athlete will receive $2,000-$5,000 extra per school year,” according to CBS Sports. This is a result of the NCAA allowing schools to supplement what they call the cost of attendance, or the “difference between the traditional scholarship (room, board, books, tuition) and other living expenses (clothing, laundry, insurance, even a one-time computer expense).” However, this number varies between schools and can also vary athlete to athlete. Soon, student-athletes will learn how to take advantage of the system to receive the largest stipend possible. Stipends have come a long way since the 1970s, when student-athletes were only given a monthly stipend of $15 as “laundry money.” On top of these stipends, athletes are essentially outfitted with a new wardrobe each year consisting of clothes, shoes, hats, and backpacks. This minimizes the cost they would have to spend on clothing if they were not a student-athlete. Other than clothes, student-athletes have access to snacks and drinks whenever they choose. Locker rooms are filled with protein bars, Gatorade, water, and other snacks. All of this is in addition to the meal plan they have as part of their scholarship, which often times includes access to special athletic dining halls.

Paying college athletes is a sensitive topic. Whether it is fair or not, it is an unsustainable system because there is not enough money to pay everyone fully and fairly. Before worrying about the logistical hurdle of determining what compensation the student-athletes should receive, it has to be recognized that there isn’t enough money for most to receive anything. The NCAA needs to address problems that were highlighted by UConn’s Shabazz Napier, who claimed he would go to bed hungry, and Wisconsin’s Nigel Hayes, who showed up to College GameDay with a sign stating he is a “broke college athlete.” As an institution that has power and influence over so many young adults, it is important that the NCAA makes sure their student-athletes’ primary needs are taken care of by providing for them in a way that doesn’t involve payment.

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