The business side of college athletics has been evolving rapidly in recent years, and another big change could be on the way.
NCAA president Charlie Baker, according to the Associated Press, sent a letter to Division 1 schools expressing a desire to create a new tier.
Because of the impact of NIL and the implementation of the transfer portal, Baker pointed to the disparity between the wealthiest of the schools and other institutions at the D1 level.
Baker’s vision is that this new tier would allow schools that have the financial means to do so to enter into NIL partnerships with athletes and pay them directly, while also offering unlimited educational benefits.
Both NIL and the transfer portal have been polarizing issues already, and Baker’s proposal is sure to ramp up the discourse. Kings of the North’s Doug Lesmerises explained what the proposal means during an appearance Tuesday on Baskin & Phelps.
“The bottom line I think is that A, it’s going to give schools more control rather than outsourcing all this NIL stuff to outside collectives and boosters where they can’t be involved in the direct payment of players," Lesmerises said. "This is the new NCAA president saying the top, richest schools you can opt into this level and if you do, you will now be allowed to directly pay players, but there’s a requirement. The requirement is you must pay them at least $30 thousand a year, and you must pay at least half your athletes – not just your football players – half the athletes in your athletic department that $30 thousand.
“So for instance, a place like Ohio State that has a thousand athletes, if Ohio State would opt into this, they’d be on the hook for at least $15 million a year. … That’s a huge investment, but that’s why I don’t think a million schools would opt into this. But the biggest, richest athletic programs would now be in control of paying players rather than having collectives do it.”
Schools that would opt into such a tier would then have NIL rolled into their purview, Lesmerises explained.
“You’d still be allowed to do NIL, it sounds like NIL would be folded into the athletic department – which I always thought would happen. You can have companies and boosters and individual people want to donate money to pay players. … but the athletic department would cut those deals and pay the players, rather than these outside things. Athletic departments don’t want these outside collectives having so much power, but right now it’s the way it has to be. It would keep NIL but fold it in.”
The idea seems like it would be appealing to some, if not all Power Five schools. But even within those conferences there are financial differences among some institutions, which theoretically could create some complications.
“The thing that I don’t have a handle on yet is, OK, I would imagine probably everybody in the new Big 10 would opt into this," Lesmerises said. "But let’s say Purdue and Northwestern and Rutgers didn’t opt into it, does that mean they can’t be in the Big 10 anymore? Maybe you just have a different set of rules, but why couldn’t you still be in same conference?
"Obviously the MAC schools are not going to opt into this. Does that mean a MAC school can never play Ohio State in a non-conference game again? I don’t think it has to mean that it's such a harsh divide that those schools never see each other anymore. It’s just your way of doing business.
“Now, if you’re paying players, is your team going to be better? Sure. But Ohio State is already better than Purdue, and Ohio State is already better than the MAC teams – so what’s the difference really? We’re already divided, we’re already in tiers, this would just be allowing the top tier to finally pay players directly, which is where we have to get.”