Unions coming to NCAA sports?

[peanut]

Last month the NLRB ruled that Dartmouth's basketball players qualified as school employees. Today, the Dartmouth basketball players voted to join a union.

The Dartmouth players reportedly want to create a conference-wide bargaining unit -- meaning, all Ivy basketball players would bargain together.

Dartmouth, I'm sure, is going to get this in courts. So I guess we'll just see how this goes.

Article here.

Edited March 5 by peanut

[BuckyBadger]

Maybe basketball can pull that off, even at Dartmouth. But wrestling?

How do you think most ADs will take to money losing wrestling programs making collective bargaining demands? 

[peanut]

15 minutes ago, BuckyBadger said:

Maybe basketball can pull that off, even at Dartmouth. But wrestling?

How do you think most ADs will take to money losing wrestling programs making collective bargaining demands? 

Right. I think for money-losing sports, collective bargaining demands would be met with "you guys lose money, so we're not in a position to throw even more money at you. We might even need to cut your sport."

But for the moneymaking football and basketball programs? The players could understandably want a bigger piece of the pie. Then the downstream effects would impact sports like wrestling.

[ionel]

3 minutes ago, peanut said:

Right. I think for money-losing sports, collective bargaining demands would be met with "you guys lose money, so we're not in a position to throw even more money at you. We might even need to cut your sport."

But for the moneymaking football and basketball programs? The players could understandably want a bigger piece of the pie. Then the downstream effects would impact sports like wrestling.

What universities are going to want to go through this for any sports?  No universities make money on D1 athletics.  There are universities with DIA's that maintain a positive cash flow but the university isn't making money off of it.  Maybe its time to revert to the Euro approach, keep some club sports and intermurals. 

[peanut]

1 minute ago, ionel said:

What universities are going to want to go through this for any sports?  No universities make money on D1 athletics.  There are universities with DIA's that maintain a positive cash flow but the university isn't making money off of it.  Maybe its time to revert to the Euro approach, keep some club sports and intermurals. 

No university wants to bargain with any athletic team. But some athletic bring a lot of money in.

Michigan's athletic department reported a surplus of $17.1 million in 2022, helped by $210 million in revenue. Assuming the football program makes the most money for Michigan, why wouldn't the football players ask for more? Why shouldn't they want to enjoy more of the fruits of their efforts?

[ionel]

1 minute ago, peanut said:

No university wants to bargain with any athletic team. But some athletic bring a lot of money in.

Michigan's athletic department reported a surplus of $17.1 million in 2022, helped by $210 million in revenue. Assuming the football program makes the most money for Michigan, why wouldn't the football players ask for more? Why shouldn't they want to enjoy more of the fruits of their efforts?

Exactly, an athletic department surplus not money for the University.  The University will be on the hook for the athletic "employees," insurance, bargaining, long term injury lawsuits, etc. 

[wrestle87]

Ladies and gentlemen, this will be the financial end of many many Universities around the country. 

You heard it here first.  This will be a very very interesting couple of pages in the history books that our grandchildren read.

[fishbane]

1 hour ago, ionel said:

What universities are going to want to go through this for any sports?  No universities make money on D1 athletics.  There are universities with DIA's that maintain a positive cash flow but the university isn't making money off of it.  Maybe its time to revert to the Euro approach, keep some club sports and intermurals. 

Top FBS football programs like the University of Alabama have football revenue in excess of $100 million.  I am sure they would prefer to not have to share a fair portion of that with the football players and that the ability of the football players to force them to share it would be increased if they were allowed to unionize and bargain as a unit.  

If a university such as Alabama isn't making money on D1 football it is because they are spending that $100MM on coaches salaries, administration, facilities, and other loss leading sports.  They certainly could pay the players some portion of that revenue and be profitable.  Coach's salaries would take a hit, facilities might take a backseat to players wages, non-revenue sports might have their budget reduced.  This is exactly how it should be.  Major professional sports leagues such as the NBA pay players about 50% of revenue.  What percent of the football revenue at Michigan, Alabama, Ohio State, Texas, ect is shared with the players?

[BuckyBadger]

58 minutes ago, wrestle87 said:

Ladies and gentlemen, this will be the financial end of many many Universities around the country. 

You heard it here first.  This will be a very very interesting couple of pages in the history books that our grandchildren read.

The financial end of universities as a whole or just university athletic departments?

[wrestle87]

Just now, BuckyBadger said:

The financial end of universities as a whole or just university athletic departments?

Another incomplete thought on my part, which has been a problem for me the past few days, my bad.  Athletics plays an integral role in the financial viability of many institutions.

Trouble with finance and athletics --> no more school

[ionel]

20 minutes ago, fishbane said:

Top FBS football programs like the University of Alabama have football revenue in excess of $100 million.  

That's revenue, how much do they spend?  Let's see the full budget, most spend all their money.  But let's say an Alabama actually has some excess, how many others?  If with changes 2/3 of SEC are losing money and drop athletics and 3/4 of B10, all of B12 and ACC, PAC already gone, Mountain west no way.  Then who is Alabama going to play and who is going to watch thus where is the future revenue? 

 

BTW:  the NFL should probably be a little bit concerned.  NBA could more easily work around the problem.  

Edited March 5 by ionel

[BuckyBadger]

23 minutes ago, wrestle87 said:

Another incomplete thought on my part, which has been a problem for me the past few days, my bad.  Athletics plays an integral role in the financial viability of many institutions.

Trouble with finance and athletics --> no more school

I can see how most athletic departments will disappear or be dramatically scaled down in the coming years, but why do you think what’s going on with athletics will lead to whole universities closing? 
Wouldn’t they just cut the fat instead (athletic departments, DEI offices, armies of administrators etc)?

Edited March 5 by BuckyBadger

[peanut]

1 hour ago, wrestle87 said:

Ladies and gentlemen, this will be the financial end of many many Universities around the country. 

You heard it here first.  This will be a very very interesting couple of pages in the history books that our grandchildren read.

Universities can survive without sports. According to PBS, athletic expenses surpass athletic revenue at the “overwhelming majority” of colleges. 

[wrestle87]

6 minutes ago, peanut said:

Universities can survive without sports. According to PBS, athletic expenses surpass athletic revenue at the “overwhelming majority” of colleges. 

That does the complexity of university finances a disservice.  Determining which departments have which revenues attributed to them is the dance that CFO's play all year every year, and it is charitable to describe university accounting practices as misleading. 

I've spent a few years reading and dissecting and analyzing the financial statements of colleges large and small around the country.  My computer currently has a few thousand audited financial statements in its download folder.  If you care to do any digging yourself, just google "[Name of school] 990" which will pull up the Propublica form for each school.  99% of schools also file audited financial reports (hah), that show year over year fund flows and, primarily, serve to account for the way they use their endowments and contributions to pay for the operations of the school.

Athletics is a major part of every school because, more often than not, even if the programs themselves don't do enough to get kids into the school, they do serve to cast a wider net to families who are interested in paying more for college.  The Athletic departments, in this case, bolster the tuition revenue of the school.  This is very common in small schools especially. 

The prospect of these schools in particular having to treat their athletes collectively as employees will break the back of most of them.  It is a multi-million dollar reversal of direction of flow of funds annually.  Considering that ~85% of schools ranked outside the top 30-40 nationally have run operating deficits since 2020, this trend will note reverse.

The University model became entirely investment income dependent in the 2010's, what with rates being at historic lows and all, but now with rates going up and asset prices going down considerably, the tap is being shut off on the seemingly bottomless dividends that endowments could kick out to cover whatever costs needed to be covered.  Endowment principal is now being used to cover the gap between tuition revenue and operating costs.  Of all the many hundreds of schools I have looked at, I can think of less than ten that operate such that tuition revenue covers operating costs.

Turning a significant source of revenue into an employment negotiation (making some assumptions here), will be very detrimental long term.  Most schools have less than 5 years of operating costs in endowment reserves.  Many have 3.  Some like Drexel University, have less than 1.  

Broad spectrum unionization of athletics will likely lead to the closing of 20% of universities within the next 10 years if rates don't return to below 2%.  

Not that people came here for a High Ed Economics Market Report...

[CHROMEBIRD]

Unionization isn't necessarily all about wages or scholarship money. NR sports/players unions could press institutions for better meal plans, access to facilities & equipment, better healthcare options, input into the training calendar, study hours, injury protocol, and so on. Didn't the whole "colleges should pay their players" thing first gain traction when athletes complained about going hungry because of limitations on their meal plan?

It's hard to imagine any D1 wrestling program unionize, but it could bring about favorable changes for athletes and fans.

[ionel]

7 minutes ago, CHROMEBIRD said:

Unionization isn't necessarily all about wages or scholarship money. NR sports/players unions could press institutions for better meal plans, access to facilities & equipment, better healthcare options, input into the training calendar, study hours, injury protocol, and so on. Didn't the whole "colleges should pay their players" thing first gain traction when athletes complained about going hungry because of limitations on their meal plan?

It's hard to imagine any D1 wrestling program unionize, but it could bring about favorable changes for athletes and fans.

They have free meals now.  Although if union maybe wrestlers (save hwt) can complain they don't get their fair share.  

Edited March 6 by ionel

[CHROMEBIRD]

5 minutes ago, ionel said:

They have free meals now.  Although if union maybe wrestlers (save hwt) can complain they don't get their fair share.  

Read the rest of the paragraph. Also I think a lot about how much ice cream Kyven Gadson must have eaten after Nationals, haha

[ionel]

5 minutes ago, CHROMEBIRD said:

Read the rest of the paragraph. Also I think a lot about how much ice cream Kyven Gadson must have eaten after Nationals, haha

Yeah I did, but I think the wrestlers are more focused on the food.  I can imagine the Penn State wrestlers demanding first access to the Creamery, even Wkn can understand this.   

[wrestle87]

It will be interesting to see if this evolves on a sport by sport basis, an institution by institution basis.  

Higher Ed has been gradually turning the levers on always taking as much as they can, without budging an inch, for ~3 decades now.  Them being put in their place and being forced to behave in a way that moderately resembles having to adhere to market forces will be interesting.

Also, more unionization --> less wiggle room for NCAA shenanigans.  Think about how much better this would have gone for the Iowa and ISU wrestlers if there were actually pre-arranged processes in place rather than just flip of a coin punishment. 

[CHROMEBIRD]

Exactly. An athletes' union could also have pushed for expediency with the investigation and decision-making.

I would love to see the NR sports unionize, either institutionally or at a conference level. It would be really difficult to pull off and I don't know if a one size fits all approach would fit across the different non-revenue sports, but a union like that could in theory give "small sport" athletes a seat at the table alongside football and basketball

[Idaho]

1. Football and basketball drop from the NCAA and form their own leagues

2. Because they are a union and now have their own leagues, they use their own money to lease back the stadiums and arenas from the schools, who also receive a percentage of revenue as well as part of the agreement.

3. Lease and revenue money goes to the school sponsored sports. 

4. Boosters connected to the school now use NIL money to support actual school sports rather than a semi-pro minor league football and basketball program no longer affiliated with the school. 

5. Football and basketball leagues go bankrupt leaving greedy kids with no place to go.

6. Well what do you know, here comes the union and the athletes wanting to be part of the school and NCAA again because without it they can't get paid. 

It's all part of my plan. 

[fishbane]

3 hours ago, ionel said:

That's revenue, how much do they spend?  Let's see the full budget, most spend all their money. 

They are non-profits they're supposed to spend what they take in.  It's a feature of the system.  There is no incentive to maximize the surplus (what would be profit) since there are no owners to reap the reward.

If the top 25 FBS football programs were forced to pay 50% of revenue to the players (like what the NBA does) the only reason it seems like it would cause them to go 50% into the red is because they are currently spending money like they don't have to pay the players anything.  This has inflated spending on facilities and the salaries of coaches and administrators.

Spending on facilities in many ways was a proxy for paying players.   You cannot attract a top recruit by paying them $$ so you spend the money on facilities and use that to attract them.  Compare the facilities at the FBS top 25 with AAA baseball, AHL Hockey, NBA G League, or the CFL.  Compare the salaries of the coaches at these institutions with minor league sports managers in these leagues...  Or compare them with top level pro managers.  Nick Saban's annual salary would be top in either MLB or NHL and top 5 in the NBA.  

3 hours ago, ionel said:

But let's say an Alabama actually has some excess, how many others?  If with changes 2/3 of SEC are losing money and drop athletics and 3/4 of B10, all of B12 and ACC, PAC already gone, Mountain west no way.  Then who is Alabama going to play and who is going to watch thus where is the future revenue? 

I mean this is far afield of the Dartmouth Basketball union which I don't think will be negotiating $$ in their first CBA since there is essentially is no revenue there to split.

But supposing the SEC or Big Ten football players unionized collectively bargaining with its member institutions. I imagine an initial CBA with an SEC players union would be far less than a 50/50 split because of contractual obligations for inflated coach/administrator salaries and capital expenditures being on the books.  A now realistic threat of the union not playing would probably result in an offer more than $0 with an annual ramp up throughout the term of the CBA.  This would allow the institutions to adjust from spending 100% of revenue to something less.

If teams in the conference falling into the red and not being able to compete is an issue that is largely a solved problem.  The NBA's revenue sharing system not only splits revenue 50/50 between players and owners it also features a revenue sharing component where the top 1/3 or so of teams in revenue share revenue with the others.  This ensures the rich big market teams have competitive opponents in smaller markets.   In the NBA this might be the Warriors, Lakers, Bulls, Heat, 76ers, Celtics ect paying into a fund that is distributed to the likes of the Bucks, OKC, New Orleans, ect.  In the SEC it would be Alabama. Georgia, Florida, Auburn, Texas A&M, paying to teams like Vanderbilt Arkansas, Mississippi State.

Professional leagues have been paying their players for decades and decades and figured all of this stuff out.

[fishbane]

2 hours ago, wrestle87 said:

Also, more unionization --> less wiggle room for NCAA shenanigans.  Think about how much better this would have gone for the Iowa and ISU wrestlers if there were actually pre-arranged processes in place rather than just flip of a coin punishment. 

This is true in general, but I don't think the gambling punishment qualifies as shenanigans.   I also don't think a union changes the punishments of the Iowa/ISU players in any substantive way. All major North American professional sports leagues (MLB, NFL, NBA, NHL, MLS) have unions and prohibitions on gambling.  There is often very little room for appeal when it comes to these kinds of violations. 

For example the NBA’s constitution and bylaws give broad authority to the league commissioner to punish any player who “directly or indirectly, wagers money or anything of value on the outcome of any game played by a team in the league operated by the Association.” After the accused has had a chance to answer the charges, “the decision of the Commissioner shall be final, binding and conclusive and unappealable.”

Edited March 6 by fishbane

[Red Blades]

Given that Dartmouth athletes do not receive any scholarships money for playing (as is the case with all Ivy League athletes), I'm not sure I understand how they can be considered employees - at least not any more so than any other students on campus.  As such, I wouldn't be surprised if this does not hold up in court.  But then again, it's a crazy world we live in, so I guess - wait and see!

[wrestle87]

52 minutes ago, Red Blades said:

Given that Dartmouth athletes do not receive any scholarships money for playing (as is the case with all Ivy League athletes), I'm not sure I understand how they can be considered employees - at least not any more so than any other students on campus.  As such, I wouldn't be surprised if this does not hold up in court.  But then again, it's a crazy world we live in, so I guess - wait and see!

This is a way that the Ivy gently sidesteps what they do.

Ivy League colleges do give out athletic scholarships...they just call them something else.  They can label them as academic or need-based scholarships, or they arrange tuition support from donors and alumni groups to be funneled in the direction of certain families rather than specifically naming funds athletic scholarships. 

The whole "no athletic scholarships" thing is meant to support the academic image of the ivy league, so they don't put it out there that they are "diluting" the academic abilities of their campuses with athletes.  Those kids absolutely get compensation, and it could be argued that they are engaged in a form of barter, offering their athletic services in exchange for access to the future prestige of being an Ivy Grad. 

Ivy's do a better job than most of hiding what they do, but it's still pretty cut and dry that it's an exchange of services.