Too big to fail?

10 Things To Know About The NCAA’s House Settlement

www.forbes.com/sites/kristidosh/2024/05/24/10-things-to-know-about-the-ncaas-house-settlement/


-Who is Paying the Money?

Reports have the NCAA paying $1.1 billion of the $2.8 billion for past damages, with approximately $1.65 billion being paid by the Power Five and the remaining 27 Division I conferences paying $990 million.

Reports have this being funded through both the NCAA withholding payments to universities (which is largely revenue from March Madness) and direct payments.

(my bottom line here is that if you don't pay your share, the NCAA will withhold payments to the university - so as long as you are a member of the NCAA, you will pay.)

-How Much Money Are Current and Future Athletes Getting?

Going forward, it’s estimated athletic departments will be able to pay athletes up to $21-22 million annually per school for future revenue sharing. That number will also increase over the 10-year period of the settlement based on 22% of the average Power 5 school’s revenues. The revenue categories being included are TV contracts, ticket sales and sponsorships, but not donations.

-Where Will The Money Come From?

This is a question every athletic department in the country is asking right now. Do they put facility upgrades on hold? Layoff staff? Cut sports? Lean on donors because it’s one of the sources of revenue that won’t increase the revenue sharing bill?

-What Else is in the Settlement?

According to a report on the settlement from Ross Dellenger, the settlement document also includes a reporting requirement for third-party NIL deals that might be tied to the athlete’s revenue-share payment and a definition of “True NIL,” which will be based on a to-be-developed calculation of fair market value.

One other interesting aspect of the settlement is that it eliminates NCAA scholarship caps and contemplates new roster limits, meaning in sports like baseball, where scholarships are often split into small amounts across the team, full scholarships can now be offered to everyone on the roster if they have the funding.


-Does Title IX Apply?

Speaking of Title IX, there’s already a debate going on across the legal industry about whether or not Title IX will apply to the revenue sharing contemplated under this settlement.

Attorney Mit Winter of Kennyhertz Perry argued on X that he believes Title IX wouldn't apply.

-Does This Solve the NCAA’s Legal Problems?

Although it might seem on the surface like this settlement sets up some protection and stability for the NCAA going forward, this agreement only settles three cases: House v. NCAA, Hubbard v. NCAA and Carter v. NCAA. Just yesterday, the judge in the Fontenot v. NCAA case declined to consolidate it with House, and there are multiple other cases across the college athletics landscape that pose future issues.

Athletes will also have the option to opt out of the settlement agreement in House, meaning they will preserve their legal right to appeal the settlement or bring a future case.