What the historic $2.8 billion settlement to pay NCAA players means for college sports

Geoff Bennett:

In an historic first, the NCAA and nation's Power Five conferences have reached a deal to pay their athletes.

The ACC, Big Ten, Big 12, SEC and Pac-12 accepted the general terms of a settlement that will see the NCAA pay nearly $2.8 billion in damages over 10 years to nearly 14,000 athletes dating from 2016 to now. It also creates a new system that allows schools to use up to $21 million a year to pay student athletes in any sport starting in 2025.

The agreement was proposed to resolve a series of lawsuits challenging the NCAA, which may have had to pay billions more. It still needs to be accepted by a judge and many details need to be worked out, including how schools will pay athletes, whether payments will be equitable by gender, and what it means for different sports.

For more on this landmark deal, we're joined by Pat Forde, senior writer for "Sports Illustrated."

Pat, it's great to have you here.

So I think it's safe to say the days of the amateur student athlete, college athlete, those days are over. Help us understand how significant this moment is.

Pat Forde, Senior Writer, "Sports Illustrated": Yes, this is the death of amateurism, which has basically been on the books forever in college athletics.

So it is a significant milestone. The castle walls of amateurism had been eroding for years, most specifically starting three years ago, when name, image, and likeness payments were first approved, but this is a major acceleration from that.

This provides, as you noted, back damages to four years' worth of college athletes who are no longer in their sports, and then also a framework to pay for a decade going forward. So this is a lot of money being transferred from the traditional coffers of the athletic administration, coaches, athletic directors, facility usage into — directly into the hands of the players and it being done by the schools themselves.

That's the real change here.

Geoff Bennett:

How soon could we see these payments start going out to student athletes?

Pat Forde:

I think it's going to be about 14 months from now, 15 months, setting into the 2025-'26 academic year. That's kind of what the target is right now.

There's still a million loose ends to this, so there's a lot of work to be done on the details, but that's the target date for when you will start seeing major sums of money going directly from institutions to the athletes.

Geoff Bennett:

Yes.

How are schools thinking about compensating athletes in those sports that generate a lot of revenue versus those that don't, so, say, the star football player, the star basketball player versus the star pole vaulter?

Pat Forde:

Well, how this actually is going to be divided up is going to be one of the great sources of curiosity and ultimately controversy, I would imagine.

As it stands now, it seems like the preponderance of thought is to make this an institution-by-institution decision. This will not be like a nationally mandated pay scale. There will not probably be conferences dictating how much is going to go to which athletes or which sports. It'll be up to each school to decide whether they can afford a full $21, $22 million a year in revenue for the athletes or if they want to pay something less than that, and then that is divided up.

Obviously, the football players, the men's basketball player and probably increasingly women's basketball players will get the majority of this, but then, even within the team, what sort of parameters are put on in terms of performance or recruiting star power or experience as far as who gets what? That's all that's good going to be have to be sussed out at the institution level.

And it's going to be quite, I think, a process to get to those deliberations.

Geoff Bennett:

Yes.

To the point about women's sports, how does Title IX factor into the financial calculus here?

Pat Forde:

Well, that's going to be another fascinating element of this, because, obviously, Title IX has really changed the game in terms of allowing females equal opportunity or near-equal opportunity to play their sports in college to the men.

But is equal opportunity the same as equal compensation? So far, in the NIL era, it hasn't been, that most NIL dollars have gone to men's football — or men's basketball and football players. So does this ruling have an effect on that and say, no women have to be compensated in a similar manner in terms of the actual outlay of money or just maybe the number of female athletes has to be somewhat commensurate or proportional to the men?

And then you decide what the money is. But that's going to be, I think a great major flash point of this, and I think we're going to be hearing a lot about that in the next year-plus.

Geoff Bennett:

Yes, and one flash point is, how do these colleges and universities go about paying these student athletes without really classifying them as employees? How are they weighing that question?

Pat Forde:

That's an attempt to thread the needle here by the NCAA and by college athletics. Once again, they have been playing the thread needle game for time immemorial of these people probably are employees in a business setting, but they don't want to be classified as such and they don't want to have to face antitrust legislation along those grounds.

So what they are hoping is for the significant movement here to get the attention and the motivation of Congress to help come up with some antitrust exemption for college athletics to protect it from further lawsuits and to have a system where athletes are sharing in revenue, where they are being compensated, but they are not necessarily considered employees of the university.

Geoff Bennett:

Hmm.

And lastly, Pat, this doesn't replace the NIL, the name, image and likeness opportunities for those student athletes that are able to take advantage of them?

Pat Forde:

It doesn't. No, NIL is still going to be an ongoing fact of life. It'll be fascinating to see how much money is still in an NIL sort of pool versus what's now going into a strict, straight university reimbursement pool and if donors are necessarily less inclined to give NIL money now through a collective or otherwise, because they're already seeing athletes getting paid by the school itself.

But NIL will still be part of the dynamic and there will be schools that want to spend more than the $21, $22 million cap. And so they will turn to boosters or collectives and say, hey, can you help us out with this star quarterback over here? We'd like to give him some more money.

So the NIL era is changing, but it's not going away.

Geoff Bennett:

That is Pat Forde, senior writer for "Sports Illustrated."

Pat, thanks so much.

Pat Forde:

Thank you.