Name And Image Rights: Nine Points, No Cookies
With multiple states in various stages of passing "Pay to Play" laws to force the NCAA to respect the rights of athletes to earn money off of their name and image likenesses, this issue was always going to end up on the federal level. We're there. The top conferences have hired lobbyists who have been meeting with political aides, from whom I imagine the big schools are beginning to understand just much they are not getting the cookies.
Yesterday the AP's Rob Dauster said the Associated Press has obtained a document listing the NCAA's NIL guardrails. I saw a document like this too—a few weeks ago via a senior congressional aide. It's a single-page PDF produced for lobbying purposes that is meant to outline, in more direct terms, the talking points from the NCAA's working group, headed by Ohio State AD Gene Smith, that Brian discussed several weeks ago.
It's a public document, so I figured I might as well share it. The doc (PDF download):
I was also solicited for my thoughts on the nine points outlined, and will share those too. Thank you Richard Hoeg, who is one of our sponsors, for his very helpful input on these. Also to anyone put off by the deviation in tone from my normal style, understand that we are talking about federal legislation, affecting an industry worth billions, and the livelihoods of tens of thousands of current and future participants. This deserves at least a level of seriousness that lobbyists peddling the above put into it, which is to say the level of seriousness of Sesame Street characters performing in Les Miserables gifs.
[My responses to these points, with gifs, after THE JUMP]
Cookie Scores: How much of a cookie are they asking for? Point scale goes from 1 (may I have a healthy snack?) to 10 (I want a cookie the size of Saturn's rings).
One Land, One Law
1) Preclude Patchwork: To enact a single national standard to protect student-athletes on the issue of NIL licensing, eliminating divergent state-by-state rules that could disadvantage certain students and states
They are asking for a federal law to supersede the state laws, and this is perfectly reasonable. The state legislatures are serving their purpose to force action, but a patchwork of different state laws would make things needlessly complicated.
Cookie Score: I give it a 1. Good start, Power Five!
Just Call Them Agents
2) Protect Student-Athletes: To protect student-athletes from unscrupulous actors through implementation of appropriate standards and safeguards with respect to representation by NIL advisors
The concept of accredited agents in principle is fine; all of the pro leagues have them.
But they need to work on the language. More libertarian members of the legislature might suggest a private certification/accreditation body would be better than the federal government handling it, but in my experience (wife is a survivor of the EPPP) those just affix themselves to political bodies anyway, so might as well cut out the middle man. I imagine there's an agent model already in place for professional sports leagues, so it shouldn't be difficult to piggyback on state rules for agents.
Cookie Score: 2. Agents are fine. Just say agents.
Amateurism is Dead, Long Live Amateurism
3) Prohibit Pay-For-Play: To maintain the amateur nature of college sports by precluding colleges and universities from paying student-athletes to play sports, either directly, or indirectly, through NIL licenses entered into with their institutional sponsors and material athletic program boosters, not including academic program boosters.
They're asking for two things here, one of which is the moon, the other to say they shouldn't have to operate the spaceship. The moon is asking Congress to enshrine their amateurism business model/scam into national law, thus shielding the gobs and gobs of money they make from the athletes. I would guess they are asking because they want to preserve control over NIL rights for TV broadcasts of sporting events, which next to ticket sales is the largest revenue source in the industry, and by nature comes with image licensing implications.
The second is to not have the schools nor their big donors have anything to do with helping the players make money off of these new NIL rights. They like how it is now, when the conferences and members schools get to pocket all of the above-board money and the players get theirs under the table from the bagmen (and their position coaches).
To the first: No. We're here because amateurism is so over that a nation that can't even agree on Murder Hornets* agrees it's over. The goal and purpose of legislation should be to shepherd the transition because the states are doing it anyway.
To the second: No. The colleges and universities are the best, most profitable, and most likely avenue for young athletes, and removing that is non-tenable.
An important consideration here is whether they are asking for Congress to enshrine amateurism into law or asking them to carve out what the NCAA can do. Either way they are asking to ban or have the right to ban the fundamental economic mechanism of using money as an inducement for services.
Cookie Score: 10. You do not get a cookie.
* They are hornets the size of your thumb who decapitate entire bee colonies, but I'm willing to hear both sides.
But No Paying the Five-Stars
4) Promote Academics: To promote academics and minimize encroachment of NIL into the initial recruiting period by requiring one term of academic progress before collegians can agree to NIL licenses
This one is about not allowing recruits to get paid, which is silly because that's where the black market is happening. Also, if the regulations around avoiding “unscrupulousness” are sound this should be of minimal exposure. Given that it is self-evidently designed primarily to benefit the institutions at the expense of the athletes this should be a non-starter.
"Academics" here is a total red herring, and ludicrous. As I can attest from deep personal experience, the security of financial solvency does wonders for academics. This smacks of the schools most responsible for flaunting the NCAA's current amateurism rules trying to preserve the advantage gained by their lawlessness.
Cookie Score: 10, and frankly offensive.
"The Integrity of Recruiting"
5) Preserve Collegiate Recruiting: To protect the integrity of recruiting rules by prohibiting the use of NIL as an inducement to enroll or remain enrolled at a specific university or college
I believe the appropriate parliamentary term here is "Bruh."
The NCAA's byzantine recruiting rules are spiritually ignored by most institutions, impossible to enforce, and so widely reviled that they're one of the primary drivers behind the movement to secure NIL rights for young athletes. Bigger and more famous schools are going to have better NIL opportunities, and competitive balance is a nonstarter in a sport where 3% of league members have ever participated in its playoff.
Cookie Score: 10.
Exemption from Federal Antitrust Laws
6) Provide Safe Harbor: To provide safe harbor under federal law to implement and enforce NIL rules while maintaining the amateur nature inherent to the appeal of college athletics.
"Safe Harbor" is language doing some major work to express "exemption from anti-trust laws." The NCAA in recent years has been buried under lawsuits for exploiting athletes to various purposes, most famously in this blog's history being the Ed O'Bannon suit that drew in EA Sports and killed the best of all video games.
I can only imagine the response they're getting from this. No, NCAA, you aren't getting out of federal anti-trust laws, and you are not getting a pony either. As I started to say above, the concept of amateurism is not a "good" to be maintained. That point should be conceded.
If they want to keep some semblance of amateurism as a nod to the game's past, I recommend it apply to Ohio State only.
Cookie Score: 11.
Fine, But We Get to Choose Who Advertises
7) Preserve Standards: To permit universities to preserve their standards and policies by prohibiting NIL agreements with advertising categories inconsistent with higher education (e.g. tobacco, alcohol, gaming)
I get it, especially the gambling thing since they're involved in activities that get bet on. But I don't get why this is included. The purpose of this bill should be to work out how to secure the rights of a class of American citizens to sell their likeness as smoothly as possible, not to morally police everything.
At maximum, the federal government's interest should be NIL agreements must obey all laws, e.g. an under age person can't sell alcohol. The states have laws that govern these things on behalf of the children. If universities want to make their own rules here, they should.
Cookie Score: 6. Add the "NIL agreements must obey all laws, state and federal" language and call it a day.
But Title IX
8) Provide Opportunity: To implement NIL rules with a full appreciation and recognition of the diversity of our student-athletes and to ensure protection of gains made under Title IX
Well of course they would obfuscate some otherwise straightforward policymaking by drawing in the very complicated 1972 law guaranteeing equal access to institutionally organized athletics, and all the guidance built up around it. What they're saying here is when they get an ad from Budweiser they have to spend half of it on women's sports, so why shouldn't athletes?
The answer is go away: The rights of athletes to make individual transactions is at issue here, not ensuring an equitable distribution of NIL revenue. While laudable, the goal here should be to help facilitate the possibility of NIL for all athletes regardless of sport or gender, and to prevent the imposition of barriers that could prevent that from being realized.
By the way, while I'm certain that the top male athletes will make the most money from this, I caution our readers against the underestimation of the value of women's athletics. Personally, the first thing I'm buying if this law went into effect today is a Naz jersey for my daughter.
Cookie Score: 7. Nice thought.
Disclosure
9) Promote Compliance: To utilize transparency to help prevent corruption of the collegiate model.
- a) Public disclosure of NIL licenses
- b) Disclosure of representation to universities
They want the government to require athletes to disclose whom they're getting money from, and disclose their agents. Note they didn't say "public" disclosure. As worded this is so the schools will know who is getting what from whom, not so you and I will, which brings up the question of what the schools want this information for. Could it be just lead gen, or to gain a competitive advantage for marketing business from the same entities?
Again, this seems unnecessary to require by federal law. By their nature marketing rights should be pretty transparent. I understand this is likely about the schools identifying conflicts of interest as they're put into competitive situations with their own players, e.g. if a player gets his own shoe deal.
It might be better for all parties to ask the government to add contours for what information the schools may require their athletes to disclose. They might say disclosure only requires parties and length of the agreement, but nothing else. Also schools should need to implement security and other data protections to prevent misuses.
Cookie Score: 3.
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Final Crumbs
Note a few things the NCAA does not ask for. They do not specify whether the NCAA or the schools should have the ability to also sell the players' NILs. BiSB pointed out: "It's also interesting that they didn't ask, even indirectly, for schools (or the NCAA) to be able to limit player NIL rights to the extent they interfere with school or NCAA endorsements." Who gets to make the next Nike deal? Can a school force their players to use certain branded equipment?
Also note all the worm words in this document. Accrediting agents is "protect student-athletes." Preserving the recruiting black market is "promote academics" and my favorite line in the whole thing: "protect the integrity of recruiting rules." Phrases like "promote compliance" and "prevent corruption of the collegiate model" are thrown around like they think anyone of enough substance to be reading it won't see through it. It speaks to the attitude of the schools; the level of dishonesty is proportionate to the level of corruption they're asking for.
The most honest title is "Prohibit Pay-For-Play," or in other words "Ban Capitalism." They should concede that we are here because the states have deemed the so-called "collegiate model" incongruent with the rights and liberties of adult Americans to free conduct of trade.
You may think a lot things about the politicians in Washington, but in this at least there appears to be widespread agreement that the NCAA's major conferences are not getting an anti-trust exemption, nor having their corrupt business model rescued from the states who've deemed it a violation of their citizen-athletes' rights.
Ok but let’s circle back on banning capitalism
Hoeg is a fellow Hillsdale College grad like myself and I’m certainly no attorney so my point of this is not to argue, but on point 3 (pay for play with the university) couldn’t an issue be raised, at least in someway, a player entering into a agreement from compensation for a University would open up Pandora’s Box of Title IX lawsuits?
At one point in time in my college studies Athletic Administration was what I wanted to get involved with and our assistant AD which taught our class and us students belabored that point for hours it seemed.
It seems difficult (If not impossible) to propose a way for the University to compensate each athlete their individual value and adhere to Title IX.
I'm only familiar with the California law so I'm not sure how other states have tried to address this issue. The California law addresses it this way:
"A postsecondary educational institution, athletic association, conference or other group or organization with authority over intercollegiate athletics shall not provide a prospective student athlete with compensation in relation to the athlete's name, image, or likeness."
In plain language, the schools are prohibited from paying them. If the schools aren't paying them, there is no Title IX issue. Basically it's saying players can go out and negotiate a contract if they want to and the school is not to be involved. So if the local Ford dealership wants to pay the star QB money to come down and sign autographs on Sunday after the big game, the dealership calls the star QB and they make a deal. It has nothing to do with the school. Is the Ford dealership going to offer the same deal to a woman on the rowing team? Nope. And that doesn't implicate Title IX because it's not the school doing it.
I do wonder about the language that says "prospective student athlete". That could be interpreted to mean only players who are being recruited. I'd argue it means it's the athlete's choice whether or not he/she is going to play each and every time he/she steps on the field. So they are perpetually prospective student athletes even while attending college.
As a side note, the California law also addresses the issue of a player signing a Nike deal while playing for an adidas school. "A student athlete shall not enter into a contract providing compensation to the athlete for use of the athlete's name, image, or likeness if a provision of the contract is in conflict with a provision of the athlete's team contract."
I think we’re talking about two different things, because I agree with everything you said. Athletes entering into an agreement with Nike circumvents Title IX; an agreement with Michigan potentially does not.
What Seth wrote is: “3) Prohibit Pay-For-Play: To maintain the amateur nature of college sports by precluding colleges and universities from paying student-athletes to play sports, either directly, or indirectly, through NIL licenses entered into with their institutional sponsors and material athletic program boosters, not including academic program boosters.
They're asking for two things here, one of which is the moon, the other to say they shouldn't have to operate the spaceship. The moon is asking Congress to enshrine their amateurism business model/scam into national law, thus shielding the gobs and gobs of money they make from the athletes. I would guess they are asking because they want to preserve control over NIL rights for TV broadcasts of sporting events, which next to ticket sales is the largest revenue source in the industry, and by nature comes with image licensing implications.
*****
Seth seems to be indicating he’s against the proposal quoted, which involves precluding payment from universities to students for athletics. I think you and I agree this is either A) not feasible because of Title IX or B) not something universities are going to want to defend in court.
From those perspectives, I can’t say I disagree with the universities, as unpopular as it might be. But I realize too people would rather grumble about the NCAA then laws that were passed in 70’s that no one is going to overturn, so I get it.
I totally get what you're saying, and yes the California law, which was the first venture into state legislation, purposefully avoided Title IX for simplicity's sake.
The opponents and proponents of Title IX are still very much out there, and are a complicating factor here because any legislation involving college athletics is bound to be an opportunity to re-legislate a controversial law. But the lawmakers themselves are running the show here, and from a layman's perspective it does't seem that difficult to step around the issue by simply absolving the universities from Title IX obligations for paid employees.
You made a great point lower down regarding coach salaries, which I hope you don't mind if I consolidate our conversations. The 1994 USC ruling, if I'm not mistaken, sidestepped Title IX (because it refers to athletes) and was tried under the Equal Pay Act. You're probably correct that Title IX would be much harder to dodge in a similar case between, say, compensation for the starting point guard of the women's team in comparison to the compensation for the men's team's PG. So legislation will have to address it.
Ways they could address it include:
- Ending or weakening Title IX
- Reinforcing Title IX and requiring schools that compensate male athletes to compensate female athletes the same way, or
- Statutorily exempting direct athlete compensation (anything that's not room, board, facilities, coaching quality, or scholarships) from Title IX.
As I understood it, the Power 5 conference lobbyists are asking for #2, and doing so in bad faith because they know it would ignite the maximum political battle over Title IX and thus bury the simple and bipartisan Pay for Play legislation. I am sure some politicians will want to use this opportunity to try #1. And I think #3 neatly punts the complex issue so we can enact the simple one.
In practice, the schools have been skirting this for years already, paying players in the hundreds of thousands under the table through their assistant coaches' salaries, and also cooking the books to show more funds going to women's sports, e.g. when Michigan State pumped $20 million into upgrading a women's basketball facility called the Breslin Center, or when TCU built a giant, state-of-the-art indoor Women's Equestrian Center that the football team can borrow for its indoor training facility on the 360 days a year the gals (and their horses) aren't using it. In my opinion, laws that aren't being followed should be changed, and this is an opportunity to do so. But I don't want to interject my own politics too deeply into this when there's a fairly straightforward legislative opportunity on the table.
So circling back to #2, this would of course have some unintended effects. Namely, the insane building sprees that college programs have embarked upon to even out the books will end as athletic departments shift that money to direct compensation of their most sought-after athletes. Certainly a runaway effect, where all athletics suffer because the school is going all-in on a transfer quarterback, would be bad for athletics in general. Salary caps in the major sports, if I understand it, are exempted from anti-trust laws. I am guessing the endgame for college sports is they get a similar boon--not a blanket exemption but some of one. Also the way they do things now that results in palaces for field hockey won't survive this because things shouldn't have gotten to that point in the first place. The market isn't a solution for everything, but it can certainly do a lot of the heavy lifting.
Thanks for the great response, Seth. I couldn’t agree more with what you said. The easiest thing (to fix the problem) is Title IX reform, which is ironic for me to talk about because the college I went to is not bound by Title IX (which if the payment issue is on the table, maybe that’s something more colleges should look at), but that’s a topic for another day. If it’s feasible or not is the million dollar question .
You and me are probably different politically but we can probably both agree the optics of Title IX reform are going to be something politicians on both sides of the aisle are probably going to be very hesitant to get involved with. I wholeheartedly agree Title IX should have been reformed years ago when castles were built for Field Hockey to give the books the necessary ink to show funding was ‘balanced’. I never argue politics on here (and I certainly don’t want to now) but I’ve always thought Title IX reform will never happen because no matter the politician or party affiliation it will get spun as them being “against women’s rights” and that’s career-icide.
Keep up the good work on this!
I can't think of a more difficult road than actually reforming Title IX. The first crack at it would be to roll the clock back 150 years. These days the main argument against Title IX is that it's not needed anymore. Women's sports are everywhere these days, so what's the problem? This argument is aggressively pushed by ADs that have openly stated their intent to eviscerate women's athletics the day Title IX is repealed or even weakened with loopholes, and fans who loudly advocate such measures because even after all the billions poured into football and men's basketball, apparently it's still not enough so they cry poverty -- all while insisting it's about amateurism. The very people saying it's obsolete are walking proof that it's needed today, AS IS, more than ever.
FWIW, I think Title IX is terribly written legislation. In a perfect world, I'm totally on board the idea that it should be reformed. The problem is that everyone at the table is the total complete opposite of a trustworthy voice. College sports had a full century to grow the hell up and steadfastly declined to do so, at every single opportunity. At no point EVER were they on board until they were literally obligated to comply with federal law. They're still not on board. To this day they're doing whatever they can to get around Title IX, or politically attack it, but sure, Title IX is the problem.
In that context, my reply to all those who hate it is -- tough. If they didn't want it, they should've fixed the problem before Congress got involved. They could've implemented anything; they chose to implement nothing. And sports is still so fucked up that Congress is getting involved again. Title IX is terrible, but literally every single voice in the debate against is has consistently shown to be a million times worse in every possible way. So we all get to suck it up and continue to deal with Title IX because curfews are annoying but sometimes they're needed if Tommy isn't merely a delinquent but has been torturing animals and dealing hard drugs to schoolchildren.
Again, I want Title IX to be reformed. . . by reasonable people with the competence and maturity to do a decent job. I can say without a shred of doubt that those circumstances will not exist in my lifetime. By all means, someone make the case that the NCAA is better qualified to manage collegiate athletics than Congress -- in a thread about Congress fixing the corruption of the NCAA.
The thing about Title IX is in 1972 they never thought to ask the question "What happens if the schools make too much money?" because even with TV taking off they couldn't fathom such a thing. At this point in history Bo Schembechler and Woody Hayes, the two lowest-paid coaches in the Big Ten, made less than the average American.
The intent of the law, with regard to athletics specifically, is to force universities to put equal resources into men's and women's sports, because if they didn't the schools would blow everything on football and be biased towards men's sports for the rest. The unfairness of a law that enforces equality in athletics was baked into it from the start as an acknowledgement of the unfairness of sexism in athletics. And it's done its job. American women's soccer dominates the world. Women's basketball is a viable moneymaker on the collegiate and pro levels. Softball fills its stands every summer. These are things that happened because of Title IX then discovered their fanbases. Somebody pointed out recently that schools create massive women's rowing teams to offset their football numbers, and then recruit 100 girls from the student body. My response is why is this a bad thing? That sounds like it's doing a major service to a sector of students who wouldn't have been steered towards athletics nor had the opportunity otherwise.
From a legal standpoint, Title IX, especially in recent years, became the vehicle for federal oversight of how universities treat women. This is where it's been most controversial lately, because it's done inarguable good in addressing the rampant problem of rape on American college campuses, but also inarguably has a worse record than the court system of punishing the innocent, not to mention that it's questionable legal ground to operate a secondary court system mostly for sexual misconduct under a law that is intended to ensure equal access to educational programs (it was not intended just for sports!)
So yeah, the reason you can't touch Title IX is there's a lot else built on top of it, and too much riding on it. But if you can push all of that aside to find reform opportunities you can build a consensus around, one of them is surely that providing athletic programs is part of a school's overall academic mission, and running multi-million dollar sports franchises is not. Start with that, and let's see what we can do.
They want the government to require athletes to disclose whom they're getting money from [...] Again, this seems unnecessary to require by federal law.
I took that mean taxes. IRS wants to know where one is getting money from becuase they want their piece of the action.
Perhaps they have to be explicit in the language because kids aren't reporting the money they get now when they file so Federal NIL laws are going to be a big change for some of them.
Or the NCAA/Federal gov't wants the kids to be in control of their destiny instead of funneling stuff through Cam Newton's dad or Reggie Bush's mom for example to avoid oversight.
I take it as a given the IRS will require imcome to be reported.
I think this is the biggest reason to make this Federal law. The underground recruiting payments now also become the enforcement rights of the IRS.
Players beware ... report all your income (above-board NIL income or bagman money) and pay your taxes or risk becoming a felon with serious fines and potential jail time. Recruits and their families can now become targets of an IRS audit of their football income. All of those photos of 'Bama players in a brand new car become evidence for tax evasion ... much easier to catch a kid taking illicit money than it is to wire tap an assistant coach and prove fraud.
Those bagmen payments have become big money and the NIL income will make it all the jurisdiction of the IRS. Bagmen will disappear over time as certain players get caught under-reporting income and they blow the whistle on those bagmen to cop a plea bargain. It will take time for the first scandal to emerge, but you know its is coming. But now the player and his family are also at direct risk.
Many of the financiers of bagmen are people who are already committing tax fraud, operating cash operations that they don't want to report. At Georgia for example there's a group of building contractors who take the winter off and do cash jobs. This leaves them with a ton of liquid assets they're not supposed to have, and which they're all too happy to use to buy more players for Kirby Smart. They'll often have 3rd or 4th parties buy prepaid credit cards from pooled assets. Hard to trace, especially in the South, where local churches are often those 3rd parties.
No, the IRS doesn't chase this money. They know it's a lot of work with a million dead ends, and unpopular as hell. They'll end up taxing or indicting the most popular people in their states. Woe be to the Alabama senator who launches an investigation into Saban. Or who starts issuing subpoenas to preachers for buying prepaid credit cards from private donations.
Note if you give a substantial gift (over $10k I think it is), it's you, not the recipient, who is responsible for the taxes on it. In most bagman cases the bagmen owe the money to the government, not the players. Those bagmen are shielded by multiple layers of money laundering. And because they're already committing tax fraud, they're not going to suddenly convert their operations to legitimacy. I think the IRS should go after them, especially once there are legitimate means of compensating athletes. But the low risk to athletes here makes me doubt it's going to stop.
I took a quick look and could not find an answer on this related to gifts. Would the IRS consider money from a bagman a gift? Seem like you could argue that the money was provided as compensation for playing football. The player did not get the money because the bagman is a nice guy, they gave it specifically because they play for a team the bagman supports. If that is the case the tax liability would be with the player. Anyone know how the IRS views this?
I'm not an attorney but I would imagine the fact that so many players receive money to go to one school and then choose another, or get cash after great performances, could be used to show these were gifts, not compensation. It's not like there are any contracts.
Good point. Beyond it being a small amount of tax revenue, it could also be another reason the IRS does not focus on this. The bagmen could claim its not a gift and the athlete owes tax while the athlete could claim the opposite. From the IRS’s perspective you have the difficulty of chasing down the money followed by a bunch of legal issues which would eventually necessitate rule making around how to tax money that a rather large organization (the NCAA) says should not be changing hands anyway. Probably best to spend your time hunting shady tax shelters and off shore bank accounts.
I read a frightening article--saved on my phone that my kid's playing a game on this moment--about the IRS trying to go after the biggest tax shelters and off shore bank accounts. They had an expert who knew all of their dealings, caught them red-handed, and was willing to go all the way. They still managed to beat it.
I think the NIL changes the status of the bagman and the player. The player would need to report all proceeds of cash or property received as income or risk audit. To me, NIL as a Federal law allows the IRS to avoid the dead-ends of bagman money laundering and go directly at the player. Tracing money at the player and family level is relatively easy - just need to trace bank records and purchases of goods. The implication of player tax fraud would surface the bagman through player whistle blowing to plea bargain down the charges to avoid a felony.
And a Federal agency like the IRS, doesn't really care about Saban and Alabama versus any other coach, school or State. Their enforcement division isn't very nice or political. A criminal is a criminal in the eyes of the IRS. If the money is big enough, they will audit.
If the money is big enough, they will audit.
And in my experience, if the money is small enough too...
I once got audited on a 1040 EZ return. Taxes and penalties ended up being $3,900. Which was a shit ton of money when I was an undergrad and working multiple jobs trying to make my way.
Wouldn’t underground recruiting payments already be enforceable by the IRS? Dependents must report and file if any of the following apply to them:
1. Your unearned income was more than $1,100.
2. Your earned income was more than $12,200.
3. Your gross income was more than the larger of— a. $1,100, or b. Your earned income (up to $11,850) plus $350.
I don’t think the IRS cares if this income is in violation of NCAA rules and would be under no obligation to report it to the NCAA. If you get more than $12,200 from the bagman (I think that’s earned income), or your summer job plus bagman is greater than $12,200 you need to file. Not a tax accountant so they would need to confirm but that is how I would read it.
The only reason a bunch of athletes have not been caught up in this is the IRS is not focused on enforcing it. This is probably due to a. most athletes are getting less than 12k and b. in the big picture unreported recruiting cash is small potatoes compared to the overall amount of tax cheating going on in the US economy.
Agree with Seth the bagman can currently hide his involvement and the players report nothing to the tax authorities, so the IRS has nothing really to audit. The MBB sting was an FBI-led bribery investigation where they had wire-taps, etc. The IRS doesn't have that kind of authority.
But once a player files a tax return ? All of the IRS tools are fair game and an IRS audit can be like a colonoscopy if they smell cheating. Sweep of bank accounts, social media postings, cell phone and text messages, credit card usage, cash purchases of $10k or greater, etc. etc.
NIL earnings could be decent money ($500k+) and provide an avenue to audit the trail of illicit bagman money.
I'm not sure what I have less faith in these days - the NCAA to do something logical that doesn't just benefit the old rich guys in the AD or the federal government to do something logical that actually considers the impact to their constituents rather than whatever unethical behavior helps get them elected again.
About the only reason I have optimism that the government will see through this sham of a document is because sports are one of the few non-partisan topics we have left (clearly science and facts are no longer on that list). Far right and far left fans of power-five teams probably all agree that the NCAA is a sham. Whether that's enough to overcome rich guys from the NCAA lobbying rich guys in Congress I just don't know....
You should have some cause for optimism considering at least one Congressional aide running point on this issue decided to solicit the opinion of MGoBlog.
I'm not 100 percent sure if I should be impressed or frightened by this. I think I'll go with both.
Headed by Gene Smith, no wonder OSUREJECTS.COM goes to an extremely useful site for such matters, probably where Seth got these GIFs.
No gaming sponsors? Tf
Two fold problem: Because of Title IX, EA sports can’t funnel money for the players through the university for a licensing fee, so that method is out (see my discussion above about point 3).
That leaves you with EA sports having to enter into an individual agreement with every...single...player...in...D1 FBS football. Trying to orchestrate that sounds like a circus.
Again, capitalism has a very simple and common solution for this: collective bargaining. The players are almost certain to unify under some kind of collective entity to negotiate on their behalf.
The problem with gaming sponsors is the same problem with players gambling: it creates a conflict of interest. Professionalism is a two-way street: the players are being compensated for their athletic performance, and the integrity of that performance would be jeopardized if they have a vested interest in sports gambling businesses. The NCAA would be well within its rights I think to ban players from such agreements. In fact the NCAA is probably within its rights to ask for all kinds of concessions from the players w/r/t industries they shouldn't promote because it would reflect ill upon the the league and the institutions they represent. And again, the contours of those concessions could be decided through collective bargaining.
Right, that’s option 3, but how do you have collective bargaining without employment? And again, I’ve yet to hear a compelling argument how an athlete can enter into an employment agreement with their university for fair market value and not trigger 4,654 Title IX lawsuits.
The same way they enter into non-disposable contracts to pay the football coach $25 million over 5 years.
Stanley vs. USC ( US Appeals Court, 9th circuit, 1994) upheld the coaches salary in the case was not a violation of Title IX, Title VII or other federal discriminatory labor laws.
No one knows how a possible lawsuit about athlete compensation (from the university to a student) would go because there’s no historical basis to go off. It could go in the male student’s favor, it may not. That said, it’s easy to see why universities are going to be hesitant to venture down the path: there’s no good solution. If you stick with the amateur model, you’re a dick. If you pay all athletes the same amount, you’re violating every principal of capitalism and disallowing athletes to get their fair market value. If you decide to set salaries based upon market value, you’re going to end up in court facing Title IX lawsuits.
I know everyone loves to trash the universities about this, but either way they’re screwed to some extent.
There's no doubt that if a school paid a student directly for their services, it would count as "financial assistance" under the Title IX regulations, and therefore be considered as part of the three-part test for analyzing compliance with Title IX. In the financial assistance realm, that test is unbending: the amount of financial assistance given to males v. females must be within 1%, or you're out of compliance. Now, Congress or the Department of Education could exclude cash payments for services from the current framework for analyzing Title IX, but that would turn the entire body of law underpinning equal assistance on its face.
To the extent that money received from NIL rights had some connection to the University--funded by the University, arranged by the University, etc.--that likely would be considered financial assistance as well. I suspect that's part of the reason for the current framework.
Though tangential, scholarships have long been ignored by the IRS as "income", even though there's good reason that they should be considered as much. If student-athletes start making money off their likeness, I suspect that there may be some push--not sure how much or whether it would get traction--to tax the $80k scholarships. At even a 20% rate, that's $16k a year that students would have to come up with.
Gene Smith is leading an effort to 4) Promote academics ? LOL
Maybe the Power 5 go to an CHL like draft system to make it truly a pre-professional minor league like the CHL.
A thought on point 8: this shows that NIL can solve even more problems than just those of "revenue" sports. Athletes in Olympic sports currently have to choose between a college scholarship and four years (and maybe their only opportunity) of cashing in with a professional career. Unsurprisingly, a few (cough Michael Phelps cough) take the money. This is particularly a problem for female athletes. NIL can let them do both. Win for everyone.
Seth, did your source say anything about how the players are lobbying / who is lobbying on their behalf? I know my (non-M, grad school) alma mater is very juiced up with both a federal lobbying operation (primarily involving large research contracts, to my understanding) and excellent relationships with state Congresspeople; I have to assume that the NCAA will leverage all of those relationships.
While I love the staffers I know, who are hardworking people with real integrity, I wonder if 1.) the combined lobbying power of the NCAA member schools, 2.) a conservative ideology that hates player empowerment stuff generally, 3.) personal interests in keeping the school successful (nobody wants to be the Congressman who voted to shut down Alabama football in Alabama!) / not opposing wildly popular coaches (if Saban says the bill is bad and you vote for it, how will you do in Alabama?), and 4.) a lack of lobbying / allies for players means that things will go poorly for the good guys because of politics.
They (I know one on each side now) did not mention any lobbying efforts on behalf of players. I don't know if there is one. I don't know if it matters, since the states have been passing these without lobbying efforts. I mean important swing states like Michigan, Florida, and Wisconsin. These are popular, bipartisan measures. Who would want to swim against that?
One did say the people they've met with have all been representatives of programs and conferences widely understood to be the most egregious cheaters. The alignment on this issue so far seems to be the NCAA has a few allies, who do all happen to be Republicans, but that doesn't actually mean there's a partisan split forming so much as the districts with the most constituents who are fans of the biggest football cheaters--South Carolina, Georgia, Alabama, Ohio, Mississippi, and Tennessee--also elect politically conservative representatives. On the other side you have the Congressional Black Caucus, which is currently more powerful than the cheatin-ass caucus, and is absolutely going to play a lead role in drafting this legislation.
I know what you're asking because yes, it is a concern that the pro-cheatin' lobby has yet to play its bower. But we're the dealer, it's our partner's turn to act, and so far the other side just asked for farmers or poker-for-a-point, then led with a nine off-suit, so I think we're in good shape.
I know what you're asking because yes, it is a concern that the pro-cheatin' lobby has yet to play its bower. But we're the dealer, it's our partner's turn to act, and so far the other side just asked for farmers or poker-for-a-point, then led with a nine off-suit, so I think we're in good shape.
I. . . huh? This doesn't make any sense to me. I've been away too long to remember my Euchre. Let me rephrase this into an example regular folks can understand.
The DM's had us roll for initiative and the NCAA is in so much of a hurry to deal damage that they engaged from long range and thus have disadvantage on their attack roll, so as long as we're smart with our double moves we should be able to attack next round and avoid a TPK?
. . . know what? Forget it.
More like the NCAA has been playing for so long without encumberance, and gotten away with so many increasingly ludicrous rolls in the process that they thought they could just take on a dragon, and thus find themselves facing a dexterity check against a fireball spell that is +10 to hit and begging the DM to hand them a set of fire immunity belts.
How am I doing? Also can we play more?
I know little of D&D nor Euchre but I enjoyed the last 40 seconds of reading...please keep playing!
Now I'm going to waste time explaining just to see if I can.
Euchre is a four-player game with teams of two versus two, with the teammates split up in the order (your teammate is across from you).
"Has yet to play its bower"
In every hand of euchre (consisting of five tricks) one suit is declared trump. The highest card for the duration of the hand is the Jack of the trump suit, which is also called the "Bower" or the "Right Bower" So for example if hearts are trump, the Jack of Hearts is the Right Bower, which will automatically win whichever trick it's played. So in this scenario I'm suggesting the other team--either the player sitting to my left or right--will win at least 1/5 tricks this hand.
But we're the dealer
You trade off who's dealer each hand. The dealer has certain advantages.
It's our partner's turn to act
i.e. our teammate sitting across from us
and so far the other side just asked for farmers
A homebrew rule where if you drew a hand of all 9's and 10's (the two lowest cards in the game since Euchre is played with only half a deck) you can ask for a re-deal. Most Michiganders don't play with farmers, but you often meet an Ohioan who can't possibly fathom living through a hand with a bad draw and asks if we're playing with farmers, at which point he is laughed at for disclosing he sucks.
or poker-for-a-point
An even more homebrew rule. Once all parties have received their cards someone may ask to play "poker for a point" and if all (or just one on each side) agree, the hands become poker hands and the best poker hand wins a point for their team. Again, this rule is there mostly so the person asking can be told "no" and since they've asked for farmer's already you can further deduce they have four nine's or tens, or a full house between them, IE a really shitty euchre hand.
then led with a nine off-suit
They have begun the first trick of the hand with with an extremely low card that has no chance of winning the trick. Another sign their hand blows.
No opinion on any of the legal reasoning, but agree with the general thrust, and A+ use of muppets.
The thing about federal anti-trust exemptions is that Congress has been happy to hand them out to big rich people who ask for it.
There's so much precedent (not least the MLB's, which has withstood challenges in the Supreme Court) that it's not unreasonable, in the sense that there's a very good chance they'd be given it -- especially in today's political climate.
We should do away with the myth that college football has anything to do with amateurism, but the idea that professional sports is Smith-style capitalism is equally rainbow-farting unicorns. The NCAA is happy to run football with all the lawlessness of a frontier town with a crooked sheriff, but throw Feds into the mix and it's fair odds you're just handing the whole thing over to the Mafia.
Tell Mitch McConnell that college football is (*gasp!*) financially corrupt and the guy might need some private time for a few minutes to recover from the excitement.
Regarding the “patchwork” question, I think there are probably good arguments that the federal government can’t preempt state laws like California’s that apply only to state schools. State schools are created by the state, so if the state wants to say that those schools can’t have a football program without giving certain rights to players it would likely have anti-commandeering, 11th Amendment and other federalism implications for the federal government to try to prohibit the state from imposing those rules.
This is where I get completely out of my depth. Won't the government yell "Commerce Clause!" like they do with everything else?
The Commerce Clause would be used as the justification for why the law could be enacted by Congress under its constitutionally enumerated powers, but there are other negative restrictions on Congress’s ability to act (obviously there are individual rights under the Constitution, for example, that Congress can’t violate even if it’s acting under an enumerated power). Non-commandeering is a constitutional doctrine that the federal government can’t force state government to take any action, which I suspect might come into play if Congress tried to say “you can’t condition your own state organs’ ability to play football on their doing X, Y, and Z”. There are counter arguments to be made, I think, but I would imagine Congress would be more reluctant to attempt to override state laws if it’s getting close to the line.
Thank you. I'm honored to have been able to submit my thoughts to people in a position to draft public policy on this issue, but also humbled as I realize there's a very good reason professional lawmakers and not bloggers are the ones doing so.
I've been exceedingly outspoken against NIL and the dream it somehow levels some imaginary divide between the elite 6 playoff teams and the rest of the NCAA in the name of STUDENT athlete sacrifice...
It's obvious it's moving forward. Here's where I can get on board with it. They seem to be setting up some vague ground rules for what constitutes NIL, how it's managed, and how Universities, entities, and athletes all benefit...here's an opportunity to strictly enforce it, and stand behind it...fine, athletes can receive payment for NIL, it must be reported, it must be documented and follow specific guidelines...you get caught outside those boundaries...you lose NIL and serve a real death penalty instead of punishing Allegany State U. for bagmen at Rutgers...yeah sarcasm intended...
It is impossible to make a system that achieves these two goals:
1. Players can get paid for NIL.
2. The payment must not have anything to do with which school the player is at.
When this is over, and everything goes back to normal, I hope that it will have become standard practice to punctuate legal analysis with Muppet GIFs, and we'll keep that.
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