How to Save the NCAA From Itself

Tim Foley for The Chronicle

January 06, 2014

Big-time college football has changed significantly since I played decades ago. Millions of dollars rain down from ticket sales, luxury suites, media rights, corporate sponsorships, and sales of licensed apparel. Conferences are realigned to penetrate new target markets, and the Big Ten and the University of Texas have their own television networks. It is not uncommon for today's coaches in football and basketball to earn well over a million dollars a year, making them the best-paid public employees in just about every state in the country.

It is no surprise, then, that today's athletes, unlike the players in my generation, are asking why they do not receive a bigger share of the profits. This is especially true for athletes from economically disadvantaged backgrounds, who often arrive on the campus with little financial support from home and limited academic skills to survive the rigors of the classroom. Many of those athletes do not receive the education supposedly covered by tuition. Yet their athletic talents are exploited for the financial benefit of others.

The argument for paying players received a fortuitous assist in 1984, when the University of Georgia and the University of Oklahoma argued in the U.S. Supreme Court that the National Collegiate Athletic Association had violated the Sherman antitrust law by not allowing its members to sell their television rights to the highest bidder. The court sided with the plaintiffs, labeling the NCAA a "classic cartel" that restrains trade. The court ruling, referred to as the Regents Case, added a dictum denying athletes similar antitrust protection.

Justice Byron (Whizzer) White, who was a star halfback at the University of Colorado in the 1930s, wrote the dissenting opinion in the case. He argued that his fellow justices had erred by treating college athletics as a purely commercial venture in pursuit of profits. The court may have erred, but its characterization of college sports as just another business still stands. I have often asked myself how long it would take for college athletes to challenge on antitrust grounds NCAA rules that restrict their compensation.

Twenty-five years after the Regents Case, a former University of California at Los Angeles basketball star, Ed O'Bannon, filed an antitrust lawsuit against the NCAA, claiming that former players were entitled to a share of the millions of dollars the NCAA earns from video games and other products that use their names, images, and likenesses. This class-­action lawsuit has been expanded to include current players and a demand for a share of the revenue from broadcast rights.

A win for O'Bannon would accomplish for athletes what the Regents Case did for colleges. It would give athletes a cut of the revenue, thereby extending free enterprise to the workers in an activity that even the U.S. Supreme Court concedes is merely a commercial venture in pursuit of profits. What is not clear is how the O'Bannon model differs from the current system in terms of educating college athletes. Both appear to have put education on the sidelines. My organization, the Drake Group, believes the solution lies in creating a limited antitrust exemption for the NCAA.

The exemption would allow the NCAA to restrict commercial activities that undermine academic integrity, and do so without fear of being sued. An example would be control of the scheduling of athletic contests to limit classes missed during the week. In an antitrust lawsuit, institutions might maintain that not allowing competition to occur on all days of the week limits media exposure and revenue. An antitrust exemption would allow the NCAA to slow down the athletics arms race and defend academic integrity.

It should be noted, however, that the Drake Group proposal, called the College Athlete Protection Act (CAP Act), does not support a limited antitrust exemption for the NCAA as it currently exists. As a major condition for receiving an antitrust exemption, the NCAA Executive Committee must be radically restructured, with equal authority shared among Divisions I, II, and III, and be composed of former presidents, trustees, athletic directors, tenured faculty members, and former college athletes. At least 40 percent of the Executive Committee should be former college presidents.

The CAP Act would also allow the restructured NCAA to rein in multimillion-dollar coaches' salaries that divert revenue from a college's nonprofit mission. College athletes would be students, not employees, and their coaches would be educators whose salaries would not be primarily based on the revenue they generated. A limited antitrust exemption would allow the NCAA to make a better legal case for restricting excessive salaries than might have been the case in the past.

The CAP Act, which will be submitted as an amendment to legislation reauthorizing the Higher Education Act of 1965, would compensate college athletes with educational benefits rather than with cash. Many of the benefits would be paid by revenue from an NCAA National Football Championship that would be owned by the NCAA. Several other bills are being considered in Congress that deal with issues similar to those in the CAP Act. However, the CAP Act's focus on restructuring the NCAA and using a limited antitrust exemption in the battle for academic integrity sets it apart.

Some examples of CAP Act benefits for athletes are:

  • Multiyear scholarships (five-year maximum) that would extend to graduation and could not be reduced or canceled on the basis of performance, contribution to a team's success, illness, or injury.
  • An advocate who would provide free legal advice to college athletes.
  • Full cost of college attendance for athletes in the NCAA's most competitive division.
  • An academic trust fund for all NCAA athletes who wished to pursue a postgraduate degree or another undergraduate degree. Athletes could use the fund to return to college if they had not yet received their degree.
  • Medical benefits and injury insurance for all NCAA athletes, at no cost to parents; a catastrophic-injury insurance program, including a gap-claims fund to be adjusted based on athletes' needs; and neurological-baseline assessments and monitoring related to concussions.
  • The right of an athlete to engage in commercial activities (modeling, product endorsements, and similar enterprises) that reflect the athlete's public visibility as long as the athlete's college sport or institution were not identified.

Most important, the CAP Act would require education reforms to raise academic standards for athletes and give them an opportunity to realize their academic potential. The limited antitrust exemption would not apply to commercial activities in which the NCAA had engaged before the bill was passed. Thus it would not let the NCAA off the hook for its past exploitative practices. The Drake Group's proposal looks to the future, when college sports will not be just another business.

Allen Sack is a professor of sports management at the University of New Haven and president of the Drake Group. He played on the Notre Dame football team that won the 1966 national championship.