operating revenue for 2023

[aubiefifty 18,113]

 

247sports.com

 

How NCAA legal settlement impacts Auburn athletics

Nathan King

6–7 minutes

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Thursday established another historic landmark in the modern history of college sports, as three antitrust lawsuits were settled against the NCAA and its power conferences.

The major class-action suit is House vs. NCAA, which contended that college athletes from the pre-NIL era should be retroactively compensated. Not only will approximately $2.8 billion be backpaid to former student-athletes, but the settlement has also set parameters for a new payment structure for college athletics moving forward. 

The bottom line is simple: Programs like Auburn and its athletic department — likely as soon as the fall of 2025 — will share revenue with its student athletes directly from the university's athletic funds. 

The NCAA is on the hook for 40 percent of the settlement payout — ranging back to student athletes who played from 2016-20 — while power conferences like the SEC will see their revenue distributions decrease over the 10 next years to combine for 24 percent of the damages (approximately $664 million).

Many of the finer details will continue to be ironed out, and the court approval process likely means revenue-sharing will not begin in college athletics until at least next year. Even then, variables like Title IX implications that could lead to additional sports could still be under construction by the NCAA.

Here are three ways the historic settlement will impact the future of Auburn athletics:

1. College salary caps arrive

The agreement signed by NCAA conferences states that schools can share up to 22 percent of their average revenue, which calculates to approximately $22 million for power-conference programs. No, that number doesn't include scholarships and related costs.

So while the bidding wars likely won't subside in major college sports, the spending cycle that's seemed to grow by the year since NIL was introduced could hit a physical ceiling. Whether programs have to allocate a specific percentage of revenue-sharing to smaller sports — i.e., not football and men's basketball — is still to be determined. Title IX implications loom large in that regard.

Auburn's operating revenue for its athletic department for 2023 was $195.3 million. So an NCAA-enforced salary cap of $22 million would be approximately 11.3 percent of Auburn's revenue last fiscal year. Those figures could increase, too, with the SEC and other major conferences entering into new television and media rights deals, but remember that the NCAA will be siphoning a percentage of Auburn's annual revenue for the next 10 years to pay for the settlement damages.

Of course, power-conference schools don't have to spend $22 million a year. But the hyper-competitive nature of recruiting at a high level in college sports, both at the high-school level and in the transfer portal, will likely demand programs push that salary cap to build rosters every offseason. However, at least coaches like Hugh Freeze will know how much they have left to work with — directly from their own athletic department — to address certain needs.

2. What happens to NIL collectives?

Coaches and other leaders in the college sphere have been pleading for stricter NIL laws, even after many have been implemented over the past four years. 

Documents from the NCAA's settlement contend the court will tighten up on NIL compensations regulations and punishments, "including the prohibition on booster payments if they are not true NIL." Simply put, one of the main goals of revenue-sharing is to take some pressure off donors.

In line with the impending lawsuit settlement, Freeze mentioned earlier this month that bringing player compensation in-house and sharing revenue would be a more practical avenue moving forward.

"NIL isn't going away," Freeze said on The Paul Finebaum Show. "Now, can it change and come in house to where we can take some of the TV revenue? Because we're not going to sustain raising money like we are right now, with the same people that are building that are building your facilities and your suites. That's going to get really old quick for 95 percent of us."

So Auburn's lead collective, On To Victory, isn't going anywhere. In fact, the new revenue-sharing model will include "economic incentives" from the NCAA to house NIL collectives with the university. The revenue-sharing model — essentially adding players to a school's payroll — will aim to shift collectives back toward their original intended purposes of helping student-athletes benefit from their likeness, rather than a source to bankroll roster costs.

3. Limited roster sizes 

The settlement aims to eliminate scholarship limits, while, in turn, leading to roster numbers being limited. That could mean football rosters dwindling back down to their intended limit of 85, rather than 125. Having to put every player on scholarship under a mandated roster cap could obviously eliminate walk-ons, but those details still aren't finalized, and many coaches have suggested creating a practice squad for players to contribute off-scholarship.

For sports other than football, though, maxing out rosters with scholarships can only be seen as a positive. Opportunities will now exist for, say, Auburn baseball coach Butch Thompson to offer scholarships to build depth and fill roster needs, seeing as the current NCAA limit for baseball is 11.7 scholarships spread over 32 players. 

Under Title IX, any additional scholarships for men's teams must be reflected in women's sports, too. There's a long way to go, and Title IX carries some of the largest looming implications in this settlement, but some schools may see new sports added because of the additional scholarships — that is, assuming funding can be sustained for non-revenue sports after universities will also be on the hook for directly paying all their student-athletes.

[aucom96 1,648]

I have never been less excited about Auburn football. This game is about to die and the "shared revenue" is about to be a lot of pieces of a rapidly shrinking pie. 

[autigeremt 7,131]

1 hour ago, aucom96 said:

I have never been less excited about Auburn football. This game is about to die and the "shared revenue" is about to be a lot of pieces of a rapidly shrinking pie. 

That is my “fear”….though losing sleep over it is a bit much. It was fun while it lasted. 

[aubiefifty 18,113]

Hopefully college ball will right the ship soon.