The NCAA is proposing to create a new subsection with direct compensation for athletes

In a groundbreaking move, NCAA President Charlie Baker on Tuesday proposed creating a new subdivision within Division I that would allow high-resource schools the ability to compensate athletes through trust funds and direct name, image and likeness (NIL) licensing deals. .

Proposal addressed to all Division I members in letter received by Athletic, recommended creating a new subsection of Title I that would allow institutions to pay athletes through an “enhanced education trust fund,” which would require an annual investment of $30,000 per athlete for at least half of the schools’ eligible athletes. Subdivision members must comply with Title IX, which provides equal monetary opportunities for female and male athletes. No taxes are attached to trust fund payments; Players can use the money however they want.

“This begins a long-overdue conversation among members focused on differences between schools, conferences and divisions, and how to create more permissive and flexible rules across the NCAA that put student-athletes first,” Baker wrote. Letter. “Colleges and universities need to be more flexible, and the NCAA needs to be more flexible.”

If the proposal passes, schools in the new subdivision could create their own rules separate from the rest of Division I. Members of the new sub-division can equip themselves with not only the ability to move quickly but also more means to solve problems. Policy in areas such as scholarship limits and roster sizes in various sports. Schools at the top of the collegiate athletic food chain often complain that they are held back by under-resourced schools that cannot implement the changes they want to adopt.

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In a letter to DI members, Baker called his proposal a “forward-looking framework” that “gives educational institutions more visibility, more financial resources, and the opportunity for larger brands to choose to operate with different rules that more accurately reflect their size and their operating model.”

Baker also proposed that any Division I school could enter into a NIL contract directly with its athletes, which is currently not allowed. He would also remove the current cap on education-related compensation for athletes. The thrust of Baker’s message is that the NCAA should further remove restrictions around schools’ abilities to directly compensate athletes, creating a permissive framework that allows those who can do more to do more.

Under the proposal, schools in both Division I divisions would compete against each other for NCAA championships, except for FBS football, which is hosted and governed by the College Football Playoff. Although Baker doesn’t spell it out, the most resource-rich schools he mentions throughout the letter are in the Power 4 leagues — the SEC, Big Ten, ACC and Big 12. The four conferences have commissioners. By lobbying with Congress and seeking help on issues such as the NIL, they will influence their constituencies in a very different way than their counterparts at the bottom of Division I.

Choosing a new chapter is a school-by-school decision, but a conference must involve all of its members. Presumably, it will most likely function as a subdivision within the FBS, similar to the oft-discussed power-conference split, in which some or all of the power leagues will move to operate entirely separately from the NCAA.

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Baker concluded his letter by asking Division I members for feedback. Many college athletics administrators said Tuesday they believe it’s an appropriate conversation-starter and an important step toward modernizing college athletics. The NCAA expects the Division I Board of Directors and the Division I Council to weigh in on the proposal, but it’s not yet clear who would vote to approve such a drastic rule change. It must be a full Division I member.

The NCAA faces significant legal challenges to its model as Baker’s recommendations mount pressure to allow schools to directly compensate athletes. Several lawsuits targeting the economic structure of college athletics are working their way through the courts, creating a legal environment that appears more supportive of athletes’ rights than ever before. The National Labor Relations Board pursued an unfair labor practice charge against USC, the Pac-12 and the NCAA. Meanwhile, the NCAA and its power conference schools face the most expensive antitrust lawsuit in college sports history, as the class-action suit House v. The defendants in the NCAA are seeking $3 billion in retroactive NIL and broadcast revenue payments.

Baker’s proposal is a significant step forward for the NCAA, which has spent the better part of the past 15 years in reaction mode. Baker’s predecessor, Mark Emmert, faced criticism toward the end of his tenure for lack of forethought and leadership regarding the NIL, which allowed state lawmakers to fill the void with their own laws and pushed the NCAA into the era of player compensation. Their publicity rights. Emmert failed in his efforts to get federal lawmakers on board and enact national legislation to regulate the NIL environment.

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Baker’s proposal is an attempt to demonstrate that the NCAA can reform some areas on its own, an attempt to address those within its jurisdiction by recognizing the wide disparities between those in Division I and those who are not. Federal lawmakers asked Baker and other colleges. By introducing federal legislation related to the NIL or by dictating whether or not athletes can be classified as employees, athletic leaders have shown that politicians themselves can adapt to the times when they jump into the fray. The NCAA has fought the concept of an employer-employee relationship at every opportunity in the legal arena.

Even if the proposal passes, the NCAA will continue to lobby on Capitol Hill and seek help from Congress in areas such as athlete employment status and NIL policies currently governed by state laws. It will continue its fight in court as the company tries to protect its long-standing and broad-based model in a battle against those who believe athletes deserve too much of a cut at the multibillion-dollar company.

(Photo: Kevin C. Cox / Getty Images)

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