House Settlement Hearing - April 7, 2025

[Wrestleknownothing]

10 minutes ago, BAC said:

Curiously, as soon as Livvy finished testifying and left, the packed crowd thinned out to just 4 or 5 court watchers. 

Yep, there were only ever 4 or 5 court watchers in the crowd.

[BAC]

On a serious note, I can't help but think that the direct payments are going to result in more program cuts.

I'm all for getting the NIL reporting under control, but as I understand it, the $20.5 million cap does NOT apply to third-party donors to NIL.  That means donors will continue to make their payments outside that $20.5 million, so as to maximize the college's overall buying power, and the schools themselves will need to come up with that $20.5 million.

But where will they get the money?  It's coming straight from their revenue stream -- the same revenue stream that funds the colleges' athletic departments.

I sort of doubt the administrators are going to take a 22% pay cut.  Maybe part will come in the form of increased tuition.  But surely at least part will come from AD cuts.  And I'd think they'd start with the non-revenue-generating sports.

And, if I'm understanding the settlement correctly, cutting non-revenue-generating sports has another benefit too:  the less they have to pay the athletes in non-revenue sports, the more they can pay athletes in revenue-generating sports.  So if you cut wrestling, you can apply the payments they would have received to make a more competitive offer to top recruits in revenue generating sports.

If there were some sort of mechanism that guaranteed equal treatment of sports, or at least pre-allocated what percentage of that $20.5 million each sport could receive, then there'd be a safeguard against it. But as best as I can tell, there isn't.  The 5% allocated to non-revenue sports is for past payments, not future.

Hopefully I'm wrong here, and I may well be as I haven't studied the settlement in detail.  But this whole thing is a mess.  Congress really should have stepped in here and legislated the moment the NCAA lost its mini-monopoly, but they didn't, so now everyone sort of muddles through.  

[ionel]

5 minutes ago, BAC said:

On a serious note, I can't help but think that the direct payments are going to result in more program cuts.

I'm all for getting the NIL reporting under control, but as I understand it, the $20.5 million cap does NOT apply to third-party donors to NIL.  That means donors will continue to make their payments outside that $20.5 million, so as to maximize the college's overall buying power, and the schools themselves will need to come up with that $20.5 million.

But where will they get the money?  It's coming straight from their revenue stream -- the same revenue stream that funds the colleges' athletic departments.

I sort of doubt the administrators are going to take a 22% pay cut.  Maybe part will come in the form of increased tuition.  But surely at least part will come from AD cuts.  And I'd think they'd start with the non-revenue-generating sports.

And, if I'm understanding the settlement correctly, cutting non-revenue-generating sports has another benefit too:  the less they have to pay the athletes in non-revenue sports, the more they can pay athletes in revenue-generating sports.  So if you cut wrestling, you can apply the payments they would have received to make a more competitive offer to top recruits in revenue generating sports.

If there were some sort of mechanism that guaranteed equal treatment of sports, or at least pre-allocated what percentage of that $20.5 million each sport could receive, then there'd be a safeguard against it. But as best as I can tell, there isn't.  The 5% allocated to non-revenue sports is for past payments, not future.

Hopefully I'm wrong here, and I may well be as I haven't studied the settlement in detail.  But this whole thing is a mess.  Congress really should have stepped in here and legislated the moment the NCAA lost its mini-monopoly, but they didn't, so now everyone sort of muddles through.  

Yes pretty sure it's fubar. 

[Wrestleknownothing]

33 minutes ago, BAC said:

On a serious note, I can't help but think that the direct payments are going to result in more program cuts.

I'm all for getting the NIL reporting under control, but as I understand it, the $20.5 million cap does NOT apply to third-party donors to NIL.  That means donors will continue to make their payments outside that $20.5 million, so as to maximize the college's overall buying power, and the schools themselves will need to come up with that $20.5 million.

But where will they get the money?  It's coming straight from their revenue stream -- the same revenue stream that funds the colleges' athletic departments.

I sort of doubt the administrators are going to take a 22% pay cut.  Maybe part will come in the form of increased tuition.  But surely at least part will come from AD cuts.  And I'd think they'd start with the non-revenue-generating sports.

And, if I'm understanding the settlement correctly, cutting non-revenue-generating sports has another benefit too:  the less they have to pay the athletes in non-revenue sports, the more they can pay athletes in revenue-generating sports.  So if you cut wrestling, you can apply the payments they would have received to make a more competitive offer to top recruits in revenue generating sports.

If there were some sort of mechanism that guaranteed equal treatment of sports, or at least pre-allocated what percentage of that $20.5 million each sport could receive, then there'd be a safeguard against it. But as best as I can tell, there isn't.  The 5% allocated to non-revenue sports is for past payments, not future.

Hopefully I'm wrong here, and I may well be as I haven't studied the settlement in detail.  But this whole thing is a mess.  Congress really should have stepped in here and legislated the moment the NCAA lost its mini-monopoly, but they didn't, so now everyone sort of muddles through.  

It is thought that schools will follow a similar formula for direct payments as for the restitution payments, so figure between 0% and 5% for Olympic and non-revenue sports. For these guys it really will still be only NIL. 

As for raising extra money to make direct payments, schools will experiment with all manner of creative solutions. Whatever works will be adopted by others. Tennessee is already adding a "talent fee" to ticket prices to raise money.

[CHROMEBIRD]

40 minutes ago, BAC said:

On a serious note, I can't help but think that the direct payments are going to result in more program cuts.

I'm all for getting the NIL reporting under control, but as I understand it, the $20.5 million cap does NOT apply to third-party donors to NIL.  That means donors will continue to make their payments outside that $20.5 million, so as to maximize the college's overall buying power, and the schools themselves will need to come up with that $20.5 million.

But where will they get the money?  It's coming straight from their revenue stream -- the same revenue stream that funds the colleges' athletic departments.

I sort of doubt the administrators are going to take a 22% pay cut.  Maybe part will come in the form of increased tuition.  But surely at least part will come from AD cuts.  And I'd think they'd start with the non-revenue-generating sports.

And, if I'm understanding the settlement correctly, cutting non-revenue-generating sports has another benefit too:  the less they have to pay the athletes in non-revenue sports, the more they can pay athletes in revenue-generating sports.  So if you cut wrestling, you can apply the payments they would have received to make a more competitive offer to top recruits in revenue generating sports.

If there were some sort of mechanism that guaranteed equal treatment of sports, or at least pre-allocated what percentage of that $20.5 million each sport could receive, then there'd be a safeguard against it. But as best as I can tell, there isn't.  The 5% allocated to non-revenue sports is for past payments, not future.

Hopefully I'm wrong here, and I may well be as I haven't studied the settlement in detail.  But this whole thing is a mess.  Congress really should have stepped in here and legislated the moment the NCAA lost its mini-monopoly, but they didn't, so now everyone sort of muddles through.  

NCAA has a 14 sport minimum for D1, but it's not difficult to imagine that rule going away. I also have a hard time seeing the numbers work out for anyone outside of the SEC and B1G, but that's probably why deals are being made with institutional investors. Those programs or conferences will get some money in the near-term but imo just slightly delays the demise of non-revenue sports.

[ionel]

1 hour ago, Wrestleknownothing said:

Whatever works will be adopted by others. Tennessee is already adding a "talent fee" to ticket prices to raise money.

... and how much of that will go to wrestling ... oh wait ... nevermind.

With university grant funding cuts which also help pay overhead, O&M etc across the campus where do we think this is going.  There's really no great sustaining value in IL for non revenue sports except for a money train for programs that just happen to have a billionaire who likes that sport.  You can only squeeze a turnip so many times.  

[Wrestleknownothing]

The hearing recessed for the day. The judge has open questions.

How will existing rostered athletes be treated if cap is in place? Cuts? Or grandfathered in?

What are the rights of future athletes? Can you make the settlement binding on someone not born yet?

How does the settlement interact with existing state laws?

And others?

The two sides are in agreement and have a week to respond to questions.

So no settlement today.

Edited April 8 by Wrestleknownothing

[Idaho]

Any new information on this settlement? 

In related news, Josh Pate (College Football Show) reported that players threatened to hold out of the CFB playoffs if they didn't get a new NIL deal. Nico Iamaleava was one of the players who threatened to sit out the Vols first round game in the playoffs.  Will this type of behavior creep into other sports as well if not dealt with?

[Wrestleknownothing]

4 hours ago, Idaho said:

Any new information on this settlement? 

In related news, Josh Pate (College Football Show) reported that players threatened to hold out of the CFB playoffs if they didn't get a new NIL deal. Nico Iamaleava was one of the players who threatened to sit out the Vols first round game in the playoffs.  Will this type of behavior creep into other sports as well if not dealt with?

The Athletic was able to review new NIL contracts being used or proposed if the House settlement goes through.

"

While there is no such thing as a standardized NIL contract, all contained language intended to deter the player from entering the portal.

“You’re seeing some stuff similar to coaching contracts with the buyout language in there,” said agent Joe Hernandez of Just Win Management Group. “Which is something that you wouldn’t really see in an NFL player-team contract.”

One Big 12 school required the athlete to pay a buyout equal to 50 percent of his remaining compensation if he transferred before the end of the deal’s term. An ACC school required the athlete to pay back 100 percent of his earnings if he transferred before Jan. 31, 2026.

One Big Ten player’s contract, based on a suggested template the conference sent to all of its members, requires the athlete to pay liquidated damages in the event he transfers. Another defers two-thirds of the athlete’s payments for the coming season until the end of January — after the winter portal window closes."

[Voice of the Quakers]

18 hours ago, Idaho said:

Any new information on this settlement? 

In related news, Josh Pate (College Football Show) reported that players threatened to hold out of the CFB playoffs if they didn't get a new NIL deal. Nico Iamaleava was one of the players who threatened to sit out the Vols first round game in the playoffs.  Will this type of behavior creep into other sports as well if not dealt with?

NCAA and plaintiffs' attorneys are pushing back on the idea of exempting current athletes from roster caps. Teams have already budgeted for 2025-26, and many athletes in non-revenue sports have already made plans for new teams/schools for the new season. I'm guessing the judge goes along with the latest agreement between the attorneys.

https://www.espn.com/college-sports/story/_/id/44679918/roster-limit-changes-not-offered-latest-filing-ncaa-lawsuit-settlement

[Idaho]

48 minutes ago, Voice of the Quakers said:

NCAA and plaintiffs' attorneys are pushing back on the idea of exempting current athletes from roster caps. Teams have already budgeted for 2025-26, and many athletes in non-revenue sports have already made plans for new teams/schools for the new season. I'm guessing the judge goes along with the latest agreement between the attorneys.

https://www.espn.com/college-sports/story/_/id/44679918/roster-limit-changes-not-offered-latest-filing-ncaa-lawsuit-settlement

Thanks for the article.... some schools have already had those tough conversations with kids about the roster... so a lot of uncertainty.