The University of Utah campus, with Rice-Eccles Stadium in the foreground, in Salt Lake City on Monday, Sept. 19, 2022. | Ben B. Braun, Deseret News
On Thursday, a huge step was taken to soon make college sports as we know them changed forever.
The NCAA settled three lawsuits, including House vs. NCAA, and agreed to pay a nearly $2.8 billion settlement to athletes from 2016 to 2021 that covers back damages for the athletes who were unable to earn money from their name, image and likeness.
The five power conferences, including the Big 12 and Pac-12, agreed to terms of the settlement on Thursday. Yahoo Sports’ Ross Dellenger reported that if the NCAA lost the case, damages would have been $20 billion, which would have likely led to the NCAA filing bankruptcy, so the conferences felt it was in their best interest to settle and avoid catastrophe.
According to a letter from NCAA president Charlie Baker to member schools, obtained by Dellenger, to pay the $2.776 billion settlement over 10 years, the NCAA will use 42% of its own funds, while 58% will come from a reduction in distribution to its schools.
Power conferences will have about $664 million of distributions withheld over 10 years, per Dellenger.
While the loss of that NCAA distribution — which could work out to a reduction of 0.61% of the average Power Five school’s budget, according to Dellenger — will have some bearing on Utah’s athletic department budget, the real impact will be felt in the new proposed revenue-sharing model that is part of the settlement.
Under the settlement, schools can directly pay players up to $22 million per year, starting in fall of 2025. That number, per Dellenger, was arrived at by “us(ing) an average of power conference revenue streams as a sort-of formula to determine an annual revenue-sharing limit.”
As coaches hit the…
Source link : https://finance.yahoo.com/news/financial-impact-could-ncaa-settlement-042339966.html
Author : Deseret News
Publish date : 2024-05-26 04:23:39
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