NCAA proposal would allow direct compensation from schools to athletes

NCAA president Charlie Baker unveiled a proposal Tuesday that would allow some schools to directly compensate their athletes for the first time.

In a letter to NCAA member institutions, obtained by multiple media outlets, Baker said top NCAA schools should be allowed to operate under different rules.

“The growing financial gap between the highest-resourced colleges and universities and other schools in Division I has created a new series of challenges,” Baker wrote. “The challenges are competitive as well as financial and are complicated further by the intersection of name, image and likeness opportunities for student-athletes and the arrival of the Transfer Portal.”

The proposed changes would indicate a significant shift in the NCAA’s long-held business model that has denied schools the ability to provide any type of non-academic-based compensation to student athletes.

The proposed framework would create a new subdivision in which athletes would avoid being categorized as employees and would be allowed to license their NIL rights directly to their schools.

Which schools belong to the subdivision reportedly would be a decision made individually by each school, not by the NCAA. In addition to the ability to license NIL rights, each school will be required to invest a minimum of $30,000 per year per athlete into “an enhanced educational trust fund.” The school would be required to do this for at least half of the school’s athletes, and Title IX rules must be followed, meaning the funds would be allotted equally between male and female athletes.

“It kick-starts a long-overdue conversation among the membership that focuses on the differences that exist between schools, conferences and divisions and how to create more permissive and flexible rules across the NCAA that put student-athletes first,” Baker wrote. “Colleges and universities need to be more flexible, and the NCAA needs to be more flexible, too.”

Baker’s letter said the proposed framework “gives the educational institutions with the most visibility, the most financial resources and the biggest brands an opportunity to choose to operate with a different set of rules that more accurately reflect their scale and their operating model.”

The legal pressure to compensate student athletes has been growing in recent years, and since becoming NCAA president in March, Baker repeatedly has spoken of efforts to get help from Congress to create federal laws to govern college sports. So far, Congress has been reluctant to engage, with several lawmakers encouraging the NCAA to first try to work out the issues on its own. Baker, the former governor of Massachusetts, said these proposed changes can show Congress a potential model.

“(I)t is time for us — the NCAA — to offer our own forward-looking framework,” Baker said. “This framework must sustain the best elements of the student-athlete experience for all student-athletes, build on the financial and organizational investments that have positively changed the trajectory of women’s sports, and enhance the athletic and academic experience for student-athletes who attend the highest resourced colleges and universities.”

Any changes would have to be voted on by all NCAA schools, which gather next in January at their annual convention in Phoenix.