The prospect of college athletes becoming paid employees of their schools poses a grave threat to the survival of all but a select few university athletic programs, NCAA president and former Massachusetts governor Charlie Baker said Tuesday in testimony before the Senate Judiciary Committee in Washington.
“I think it’s pretty clear that Division 2 and Division 3 schools would get out of the interscholastic collegiate sports business and turn themselves into club sports,” said Baker, one of six witnesses called before one of the Senate committees exploring how and if Congress should regulate name-image-likeness concerns.
“The typical Division 2 school has an athletic budget of $5 million or $6 million. Division 3 is more or less the same. Ninety-five percent of schools lose money on sports. Five percent of them have serious budgets with serious revenue and a concern about employment, but a willingness to do a lot more around what they believe they should be doing for student-athletes.”
That 5 percent refers to the Division 1 schools from the Power Five conferences — the Atlantic Coast, Big Ten, Big 12, Pac-12, and Southeastern — in both football and men’s basketball, which drive the vast majority of the $16 billion college sports industry.
A unanimous Supreme Court ruling in 2020 fast-tracked NIL deals on college campuses. While a vast majority are small-scale, a few million-dollar ones have helped spark what senators refer to as the “wild, wild West,” with collectives intended to facilitate NIL deals instead serving essentially as “pay to play” organizations. That has helped lead to student-athletes entering the transfer portal more often, while the top schools pay top dollar for head coaches and facilities, and conferences cut lucrative TV deals.
With a patchwork of states tackling NIL regulatory concerns complicating oversight and the NCAA facing court battles on assorted fronts, Baker has led efforts in Washington to lobby for a federal bill and a unified framework that includes standard contracts, an NIL clearinghouse on deals, and agent registration.
This was his first appearance before a Congressional committee since becoming president of the NCAA in March.
“We want to partner with Congress to go further and curtail inducements, and prevent collectives and other third parties from tampering with students,” said Baker in his opening remarks. “We support codifying current regulatory guidance into law by granting student-athletes special status that would affirm they are not employees.”
Senator Lindsey Graham urged bipartisan support for a federal bill, of which six versions have been filed.
“If this committee or the Commerce Committee doesn’t act in about a year, this thing is going to be an absolute mess, and you’re going to destroy college athletics as we know it,” said Graham.
Sen. John Kennedy cautioned that Baker and the NCAA should be careful what they wish for.
“I would strongly encourage you and your colleagues to try to get together and come up with a new system for us to consider that looks like somebody designed it on purpose,” Kennedy said. “You may regret asking Congress to intervene here. All of a sudden you’re going to be micromanaged.”
Baker mentioned a few features he would like to see in a federal bill, including “one set of rules for all athletes across all sports and all schools” and national standards for health and safety. Matters such as minimum academic standards, as well as employment for the 5 or 95 percent of schools, might be tricky to include, Baker indicated.
He pushed for greater transparency on collectives, turning to fellow witness Walker Jones, head of the Grove Collective supporting the University of Mississippi.
“With all due respect to you, Walker, nobody knows what’s going on, everything is sort of a guess and a rumor,” Baker said. “When people say we’re doing much better when it comes to women student-athletes and NIL, I don’t know if that’s true or not. Neither does anybody else.
“We need to give the student-athletes, frankly, a lot more visibility into what the price signals are so that they can make the best decision for them and their families. Under the current system, they’re in a ‘trust us’ game with practically everybody.”
Baker sounded an optimistic note that the tangle of NIL laws will improve.
“The NCAA is moving NIL bylaws forward to improve outcomes for student-athletes,” he said. “We share your concern there because they deserve to profit from NIL free from manipulation. These changes are long overdue, and they’re happening now thanks in part to our calls for action from members of this committee and from the student-athletes themselves.”
Multiple Republican senators veered to question Baker on his position on changing rooms for trans athletes.
“The policies with respect to the safety and security of student-athletes participating in our championships are pretty explicit about making it clear that student-athletes should not be forced into uncomfortable situations,” said Baker.
Michael Silverman can be reached at firstname.lastname@example.org.