Balancing the Budget: Paying College Athletes for Generating Revenue

In a Sports Illustrated feature story “Confessions of an agent,” which will appear in the October 18, 2010 issue, former sports agent Josh Luchs shines a colossal spotlight on an equally colossal giant—paying players in the most lucrative sport in amateur athletics.

It is no news that college football is a multibillion-dollar industry, generating revenue that gets dumped back into the respective universities, coaches, sportswear and equipment suppliers, media giants and the individual conferences. All of this money is distributed to different university departments and sports industry segments, but ultimately leaves no yield for the game’s primary constituents: the players.

It is time to start balance the game. Pay the players.

College Football is a Business

The top five revenue generating programs brought in $330.94 million* in the 2007-2008 fiscal year, with the next five bringing in $280.94 million*. Who gets in on that money? The university, media outlets and organizations, sports apparel and equipment giants. Keep in mind that the top college programs pay some pretty pennies for the services of the top coaches in the sport. College football is a business, and business is winning.

The Recipients Are Not the Constituents

Who are grinding out the wins, securing postseason appearances and ultimately determining the welfare of the program? It is not the university. On some levels the coaches have an impact. But in the end, the players carry the weight of a nationally recognized program. Texas was king of college football revenue in the ’07-’08 fiscal year, bringing in nearly $73 million with Georgia falling in second with $67 million. An 85-man roster, some just four years removed from high school and others less, were mostly responsible for those monetary statistics. Sure, the scholarship benefits draw the line between a student-athlete and a student, but those tuition bills hardly amount to a significant percentage of that incoming revenue.

Even with the remaining giants of college athletics, the basketball and baseball prodigies see no checks until they declare professional status.

A Majority of Players Seek the Next Level

So many college football players leave school early for the NFL, NBA or MLB Drafts for the lucrative contracts because they need the money, and it is not our place to judge their intentions. But if money is the option, monetary reparations while in school could build a two-way street and increase the graduation rates at the same time—a relative win-win in the collegiate realm. Of course it would not stop everyone, but aligning graduation and a more rewarding stipend for a four or five year effort surely will change some tunes.

Regulate to Compensate

Obviously the most prestigious schools with the deepest wallets can dish out the cash to reel in the top talent, but the NCAA will still have to play its role in regulating this new landscape of college football. This proposal does not mean multimillion-dollar checks for the Terrelle Pryors, John Walls and Mark Ingrams, rather a structured and well-regulated system for player compensation. Undoubtedly it is a slippery slope, but the sport and its components already are tip-toeing along the sidelines. Any new or modified focus will have its weak spots.

No longer is college football, or any other revenue-generating collegiate sport, fun. It is just as much a business as big brothers—the NFL, MLB and NBA—and cannot and should not be denied. For the players, college football is a gateway to success on multiple levels.

And for everyone, winning is paramount, as seen by coaches’ sky-rocketing salaries in recent years. If a coach does not win, he is primed for a change in scenery. The pressure is on the coaches, but the players may define a coach's tenure.

Here we are scratching, clawing and vilifying the sports agent when he simply sees the industry through the right light: college football is to the NFL what the NBA D-League is to the NBA. The structure is hardly the same, but while the influence and concept is spot-on, there is no denying that it is the money-making war daddy of collegiate sports.

The answer is this. Change the regulations of the game—though the NCAA will hardly budge—and start compensating the players for bringing home some serious bacon.

*From the Street & Smith Sports Business Journal