It's official: Colleges will pay athletes directly - Internationals issue not addressed
A new era in college sports is here: Colleges will now pay athletes directly as part of a court settlement. Many issues were addressed but one aspect still unclear is the visa fate of internationals.
There are landmark dates in sports history and June 6, 2025 will be remembered as one of those in college sports. That was the day when amateurism in the NCAA was officially over and colleges were permitted to directly pay athletes as part of the House vs House settlement.
The ruling by a California judge resolved some issues revolving around the ever-more astonishing world of NIL (Name, Image, Likeness) money. But some big questions are still left unanswered leaving some doubt in the world of international basketball.
Here are some of the nuts and bolts from the 76-page House v. NCAA settlement - which resolves and concludes three different anti-trust lawsuits:
Compensates prior college athletes for lost NIL
Sets a framework for schools to directly pay their athletes up to an estimated $20.5 million annually in revenue sharing
Establishes a commission to oversee adherence of salary cap
Creates an oversight authority to evaluate fair-market NIL deals
One issue that was not addressed in the lawsuit and therefore remains unresolved is international student-athletes and if revenue-sharing and NIL deals directly with colleges are a violation of their student visas.
To start off, the settlement went back in history and allowed for 2.776 billion dollars in back payments over a 10-year span to college athletes who played between 2016 and 2024. The year 2016 was used because that was the year in which the US Supreme Court declined to review the 2015 ruling in favor of Ed O’Bannon vs the NCAA - the origin of the whole NIL idea.
According to Ross Dellenger of Yahoo Sports, “About 60 percent (of the nearly 2.8 billion dollars) will come from a reduction in distribution to its schools. The NCAA is responsible for closing the 40 percent gap through other means, such as reserves, other net incomes and a significant reduction in operating expenses of as much as $18 million annually.”
Revenue sharing
The revenue sharing aspect permits schools to share up to 22 percent of their annual revenue from media rights, ticket sales and sponsorships with their student-athletes.
Beginning July 1, schools will be permitted - not required - to share $20.5 million with athletes - broken down by sports and at their own discretion. American football is expected to receive 75 percent - though some colleges will push that figure to 85 percent - while men’s basketball is expected to get 10 to 15 percent. Most of the money will flow into those two sports since they are two main revenue-generating sports. Further distribution is expected at 5 percent for women’s basketball with the remainder of sports getting 5 percent.
The amount shared in revenue will increase annually and revenue will mostly be shared by buying player NIL rights. And schools will submit a budget to show who they paid to then make sure they stay within the cap.
This ruling will not impact contracts that were already locked up before the settlement’s approval, meaning they are not to be considered by the newly formed NIL clearinghouse (more on that later).
Revenue sharing/salary cap enforcement
To help oversee and enforce the new revenue sharing rules, an LLC company was founded, the College Sports Commission, which will be headed by Bryan Seeley, a former assistant U.S. attorney who has served for more than a decade as Major League Baseball’s vice president of investigations and deputy general counsel.
The CSC will be reportedly managed predominantly by the power four conferences - SEC, Big Ten, Big 12 and ACC - and enforces rules related to cap circumvention, tampering and the such. And it is charged with handing out penalties, including being subject to multi-game coach suspensions, reductions in a school’s revenue sharing pool as well as reductions in allowed transfers and significant schools fines.
NILs still allowed - but must be reviewed first
Under the ruling, student athletes will still be able to negotiate and enter into NIL deals - both with their schools and with third parties. Any NIL deal exceeding 600 dollars, however, must by approved by a clearinghouse - which will be called “NIL Go” and run by the massive auditing and assurance and consulting company Deloitte.
NIL Go - through Deloitte - will check if any NIL deal outside of the school has any affiliation to a booster or an affiliated entity to the school. If yes, it must meet a rigorous fair market value standard. The clearinghouse can reject the deal if it’s not fair market.
If an NIL deal is not approved, the settlement allows for a third-party arbiter who could deem athletes ineligible or result in a school being fined. According to an On3 article, Deloitte officials reportedly shared that 70 percent of past deals from NIL collectives would have been denied, while 90 percent of past deals from public companies would have been approved.
The aforementioned YahooSports article states that “Deloitte is expected to approve or disapprove deals in as little as one day, and athletes can resubmit rejected deals at least once with alterations suggested by the clearinghouse. For example, Deloitte may deem a submitted $100,000 deal between an athlete and third party to actually be valued at $50,000. The player can alter the deal to align with the clearinghouse’s suggested figure or the school can cover the difference by accepting a reduction against their revenue-pool cap.”
The article added: “Deals rejected for a second time are referred to the CEO and enforcement staff and are then processed through an appeals system via court-overseen arbitration. Arbitration rulings are expected within 45 days, according to the settlement.”
While the House vs NCAA settlement is seen as a resolvement of many issues, many in college sports apparently doubt it can stop third-party NIL collective payments. Some believe lawsuits will be filed to address issues surrounding Title IX (a US federal civil rights law prohibiting sex-based discrimination in education programs and activities receiving federal financial assistance); the revenue-sharing salary cap; as well as the NIL clearinghouse.
International players not addressed
For all the items of the whole issue that were addressed, one aspect not addressed in the settlement is the matter of international students.
The athletes are in US schools under a student F1-visa, which prevents them from doing certain work activities. The issue for some time was a major sticking point until NIL collectives found ways around regulations and got the international players their NIL money.
It was never really fully addressed by the US government. There were some bills introduced in the US Congress. US Senator Pete Ricketts of Nebraska introduced the Name, Image an Likeness for International Collegiate Athletes Act into the Senate in Washington DC in October 2023, but it was referred to the Judiciary Committee.
US Representative Mike Flood - also of Nebraska - introduced a bill under the same name in April 2024 but just like its counterpart in the Senate, it too was only moved onto the Judiciary committee.
Some believe that the matter of international student-athletes must be decided by the US Congress. But with no action recently on any legislation, it is unclear what the future holds.
Also unclear is who exactly would rule if athletes are in violation of their visa status and how or when that would come. One possibility is that the U.S. Immigration and Customs Enforcement (ICE) would make those visa determinations.
NCAA President Baker reaction
The NCAA president Charlie Baker meanwhile wrote in an open latter to the schools he believes the deal will help schools regain control of the skyrocketing, largely unregulated market for paying college players through third parties.
“This is new terrain for everyone," he wrote after the announcement of the settlement. “Given the defendant conferences' new ownership of complicated pieces of rulemaking and enforcement, there will be a transition period and certainly bumps in the road. Opportunities to drive transformative change don't come often to organizations like ours. It's important we make the most of this one.”
He added: “Together, we can use this new beginning to launch college sports into the future.”
June 6, 2025 will definitely be a landmark date in college sports.
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