A potential multibillion-dollar settlement of an antitrust lawsuit eliminates the first step in the NCAA’s three-step approval process, with no changes to the pay structure that left the 27 conferences The university is not named in the lawsuit that accounts for the majority of the $1.6 billion. of damages.
The Division I Board of Regents’ Finance Committee on Monday night approved the proposed $2.77 billion settlement between the House and the NCAA for the entire board with a recommendation to comply with the original financial plan.
The NCAA, Big Ten, Big 12, Atlantic Coast Conference, Pac-12 and Southeast Conference are defendants in the House of Representatives lawsuit, a class action seeking to recover payments to college athletes who have been denied compensation name, image and likeness from 2016 The NCAA lifted its ban on athletes making money from sponsorship and endorsement deals in 2021.
The Big 12 became the first conference to pass a settlement agreement Tuesday, with its council of presidents and university presidents voting unanimously in favor, said a person with direct knowledge of the decision. told the Associated Press. The person spoke on condition of anonymity because the conferences are not making any public statements about the settlement at this time.
Going forward, the Big Ten, Big 12, ACC and SEC would shoulder the financial burden of the proposed revenue-sharing system, which would require each of its schools to commit to paying $20 million per year directly to athletes. mobilize. The overall commitment is expected to be approximately $300 million per school over 10 years.
The NCAA office was established to cover the damages of the incident over 10 years through reduced operating costs, insurance and reserve funds. Withheld distributions to 352 Division I member schools will cover the remainder. The NCAA allocates more than $700 million each year to its 1,100 member schools divided into three divisions.
The approved financial plan for the settlement calls for the NCAA to pay 41% of the $2.77 billion in damages, with the Power 5 conferences accounting for 24% and the other five major college football conferences – known as Group Five – includes 10 %.
Conferences competing in the second tier of Division I football, the Championship Subdivision, will pay 14% of the total payout and non-football DI conferences will account for 12%.
Conference commissioners from leagues that do not compete at the highest level of Division I football, the Bowl Subdivision, took issue with the $1.6 billion withheld distribution portion of the settlement. The 27 conferences not named in the lawsuit are expected to comprise 60% of the withheld distribution funds, with the remaining 40% coming from power conferences that currently include 69 schools.
Commissioners of the 22 non-FBS conferences sent a memorandum to NCAA leadership, proposing changes to the financial structure so that the power conference retains distributions representing 60% of the $1.6 billion .
Big Sky Commissioner Tom Wistrcill said Tuesday that non-FBS conferences are holding out hope for a reconsideration.
“We are fighting uphill,” he said.
The Big Sky is one of the most successful conferences in the Championship Subdivision, with schools such as Montana, Montana State, Eastern Washington, Idaho State and Weber State.
The settlement proposal still needs approval from the Division I Board of Governors, scheduled to meet next Tuesday, and the NCAA’s Board of Governors.
The presidiums of the four remaining powerful conferences, also known as the autonomous conferences, are also scheduled to meet separately this week to vote on the deal.
“We believe that more than 95% of the damages will go to A5 football and basketball players. For non-A5 conferences, paying for that is disproportionate. We are asking a more proportionate structure because our student-athletes won’t be looking at the money,” Wistrcill said,
Plaintiffs’ attorneys have given the NCAA and conferences until Thursday to respond to the settlement proposal, with parties on both sides appearing hopeful that it will be approved.
The conferences not named in the lawsuit did not learn details of the settlement until two weeks ago through media reports, Wistrcill said. He said they hope the settlement can pass, giving the NCAA’s funding plan a chance to be revised.
Wistrcill said the distribution deduction formula the NCAA is using, which is based on the percentage a conference received of the NCAA’s total distributions between 2016-2024, is expected to cost of Big Sky about $3 million per year for 10 years.
He said while power conferences will have larger total allocations retained on a per-school basis, that revenue is a much smaller portion of the athletic department budget that typically exceeds $100 million. annual dollars. Big Sky School’s sports budget is about 20 million USD annually.
“Money is flowing to their student-athletes even though (the settlement) is disproportionately penalizing our institutions,” Wistrcill said.
Associated Press reports.
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