The “pay for play” debate has temporarily quieted in the courts, but a new front has opened, as state legislators in California and Washington and a U.S. congressman have proposed legislation on this subject, while a senator has issued a report strongly favoring compensating players. Three of the four legislators have embraced the same solution — allowing endorsements and other third-party payments, but not salaries — while the senator is non-committal on the best remedy for now. These legislative actions are consistent with the tone of public commentary, which is increasingly favorable to allowing those generating huge revenue for the colleges to share in that revenue.
Given these pressures and risks, this would be an optimal time for the NCAA to look for a compromise, and it need look no further than the one proposed by the three legislators — allowing third-party payments to college athletes, but no salaries. Allowing third-party payments is that rare win-win solution (really!). It is better for the colleges than a salary structure, and fairer for the athletes who generate the revenue than any salary structure you can imagine being implemented.
For the colleges, letting other people pay your athletes is of course cheaper than paying them yourselves, but its advantages go far beyond that. Take my “athletic director of the future” challenge and you will be convinced. You are the AD of a Division I university, and salaries have been legalized. Create a salary structure for all of your athletes. (You don’t need to pay them all; zero is acceptable.) How much for an all-league quarterback? How much for a solid starter in football or basketball, or a benchwarmer? What about women? What about minor sports?
With a third-party system in place, Nike could pay athletes, and colleges are spared administrative and budgetary nightmares.getty images
When you are done, check whether you have adequately considered the following:
■ Will university officials approve your total salary budget?
■ Are you concerned about the optics of paying your quarterback more than the dean of engineering?
■ Will the basketball coach be comfortable paying his star far more than his fifth-best player? Or, if you choose otherwise, will the star be happy with the same pay as lesser starters?
■ Will there be Title IX complaints and a protest march because you spent far more on men than women?
■ After all the compromises you made, will the public think you are sharing revenue fairly with your biggest football or basketball star?
I think you will agree that this is a nightmare, but it only gets worse. What if Alabama outbids you for key football recruits and Kentucky does the same in basketball, causing your coaches to ask for a budget supplement? If you decline, you are left with an expensive but losing team, and alumni are unhappy. If you accede, more budget problems. And next year you have to do it again, with changing personnel and priorities.
With third-party payments, these problems disappear. The school not only spends zero but faces no hard decisions on total payroll, equity among teammates, genders and athletes in different sports. The market sets the prices, and Nike and the rest pay them. There are no unseemly bidding wars among colleges for recruits.
Legislation and other action
■ California Senate Bill 206, introduced Feb. 4 by Sen. Nancy Skinner, would require that state universities in California permit student athletes to profit from their names, images and likenesses.
■ Washington House Bill 1084, introduced Jan. 3 by Rep. Drew Stokesbary, would permit students at universities in the state of Washington (public or private) to receive payment for their names, images and likenesses, and retain their college eligibility for athletics.
■ U.S. House of Representatives Bill HR 1804, introduced on March 4 by Congressman Mark Walker (N.C.), would withdraw the NCAA’s tax exempt status if it did not permit student athletes to profit from their names, likenesses and images, and maintain their eligibility.
■ U.S. Sen. Chris Murphy (Conn.) issued a detailed report on various issues arising in college sports, among them the lack of compensation for student athletes beyond scholarships. He has promised additional reports on this subject.
As I said above, the athletes people are concerned about — stars who generate big revenue — should also be satisfied. Superstars such as Zion Williamson will get very large payouts from shoe companies and social media contracts; many of their competitors and teammates in revenue sports will get sizable compensation, and a few non-revenue sport stars will likely cash in, like UConn’s women’s basketball stars, Penn State’s top wrestlers, Johns Hopkins lacrosse superstars and the like. Average athletes in minor sports probably won’t. But 99 percent of athletes in minor sports generate no revenue to “share.”
A pleasant byproduct of legalizing third-party payments is that it may dry up the type of under-the-table payments that generated the current college basketball scandal. If nationally recruited high school basketball players knew that legitimate payments were around the corner, why would they risk their college eligibility by taking secret payments? (This assumes that any new NCAA regulations allowing third-party payments would prohibit linkage between those deals and the player’s choice of college, which they should; college shoe deals would need to be tweaked as well.)
Is this a pipe dream, or might the slow-moving NCAA do this? Consider that recent NCAA rulings permitted one athlete to get paid by “Dancing with the Stars,” and another to keep a $740,000 Olympic prize from his government. Condoleezza Rice, chair of the NCAA’s Basketball Commission, and Oliver Luck, ex-NCAA executive vice president, have spoken favorably of allowing third-party payments. Duke men’s basketball coach Mike Krzyzewski recently said that the NCAA’s definition of amateurism needed adjustment. Is this a trend?
This compromise solution is a no-cost opportunity for the NCAA to get on the right side of public opinion, minimize litigation risks, and avoid a dangerous new legislative battlefield. Let’s do it carefully and adjust as problems come up, before someone else does it for us, in circumstances we can’t control and with terms that will be difficult to tweak.
Len Simon is a lawyer and law professor in San Diego. He has taught at the law schools of Duke University, the University of San Diego and the University of Southern California, offering courses in Sports and the Law and Complex Civil Litigation.
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