Everybody Gets Paid Except for the Hired Help
Every year at this time American sport fans look forward to the NCAA Men’s and Women’s Division I basketball Final 4s. Beginning Saturday millions will watch and listen to the games and millions will, legally and illegally, bet huge sums of money on the games.
Highly paid coaches will stride back and forth along the sidelines coaching their teams. Well-paid athletic department people will sit in the stands and cheer the teams on. Still other highly paid coaches will work with well-paid media persons to describe the events. NCAA officials will be everywhere basking in the spectacle of the games and glowing over the money from media contracts that the tournaments bring to the NCAA—an estimated $750 million just for this year’s men’s tournament.
The only group not directly benefiting economically from all of this money is the group that ultimately makes all of it possible—the players. There has been a lot of discussion over the past few days about just how much value a college basketball player gets from an athletic scholarship. A USA Today analysis concluded that a scholarship is worth up to $120,000 per year. Sports economist Andrew Zimbalist of Smith College in Massachusetts says that the true value is closer to $20,000 per year.
Even if the higher figure is accepted the amount going to players is not much relative to revenues. Rules allow each Division I school with men’s teams to have 13 players on scholarship each year. If you multiply 13 times $120,000 the total amount spent on players comes to some $1.56 million per year. The NCAA’s latest report on Division I men’s basketball revenues shows that the median net revenue (half of schools above figure and half below) was $2.9 million, after deducting payment for coaches. Coaches’ pay varies wildly within Division 1; but the median salary for head coaches is slightly under $1 million. Any way the figures are analyzed, players would only receive between 45-50% of net revenues. In both the NFL and NBA players under the most recent collective bargaining agreements receive 57% percent of almost all gross revenues.
If the figures of Dr. Zimbalist are closer to the truth then players receive only a fraction of the revenues they help generate. There are many who believe that this is an unfair and ultimately untenable system.
In fact, the NCAA is in federal court at this time fighting a lawsuit filed by 27 former “student-athletes” alleging that NCAA illegally uses their likenesses in marketing products without paying them licensing fees. Other lawsuits have been filed recently attacking financial limitations the NCAA places on players being treated as the professional athletes many believe them to be.
USA Today ran a piece on March 31 highlighting the salaries of the 68 coaches of NCAA Division I men’s basketball tournament teams. The pay ranges upward to the $7.5 million earned this year by Rick Pittino of Louisville, whose team lost in the second round. John Calipari of Kentucky earned $3.9 million this year and can earn another $650,000 in bonuses. Even Shaka Smart of little known (before the tournament) VCU is earning $424,000 with a possible $257,000 in bonuses. His potential pay would amount to over 25% of VCU’s total budget this year for men’s basketball.
More people within the system want to sit down and talk about these inequities; but many believe it will ultimately be court action not involving balls and sneakers that will ultimately bring change to the system.
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From time to time the Digest posts pieces on current topics of interest in the sports world. These topics encompass issues that anyone working in the field of sport administration or management will conceivably have to deal with. These are academic topics that can be studied in courses offered by the United States Sports Academy. For more information visit the Academy website at www.ussa.edu.