NCAA and power conferences agree to deal that clears way for schools to pay student-athletes

The National Collegiate Athletics Association and the five power conferences have agreed to a deal that will pave the way for allowing schools to pay student-athletes, a profound moment that will usher in a new era in college sports.

The NCAA, the governing body of college sports, and the leaders of the Big Ten, Southeastern, Pac-12, Atlantic Coast and Big 12 conferences announced the agreement on Thursday night. According to multiple reports citing unnamed sources, the settlement to resolve three antitrust cases includes paying more than $2.7 billion in damages to former and current student-athletes.

By ESPN, Sources said the parties have agreed to a revenue-sharing plan that will allow each school to share up to “about $20 million a year with its athletes.” All Division I athletes who have played since 2016 are eligible to receive a share. In return, any athletes who receive a cut cannot sue the NCAA for another potential antitrust and withdraw their complaints in the three antitrust cases – House v. NCAA, Hubbard v. NCAA and Carter v. NCAA, according to ESPN.

The reports add that Judge Claudia Wilken, who is presiding over the three antitrust cases, must still approve the terms of the settlement, which could take several months, and once approved, the schools could begin revenue sharing in fall 2025.

The deal, if accepted by Wilken, represents a turning point in college athletics, which has traditionally competed under the guise of amateurism that has allowed a dark underbelly of hidden payments and compensation to flourish. Several college programs have been punished by the NCAA for their players being compensated in some way for their on-field exploits, from thousands of dollars paid to star players under the table to a coach buying a recruit a burger on a visit.

As the business of college sports took off, the veil of amateurism began to seem absurd to many observers: schools and conferences began raking in millions upon millions of dollars, coaches preached austerity and amateurism before leaving their players to take new jobs. with a huge salary increase and television networks helped reshape the sports landscape to maximize their own profits. At the same time, the players on the field were paid nothing, even though they were the ones taking part in the games that drove what has become a multi-billion dollar industry.

The case House vs. NCAA sought to change that.

Filed by Grant House and Sedona Prince, two college athletes, against the NCAA and the Power 5 conferences – Pac-12, Big Ten, Big 12, Southeastern and Atlantic Coast – the lawsuit focused on extending eight years and $8, 8 billion The NCAA signed a contract to broadcast coverage of the March Madness basketball tournament, as well as seek retroactive compensation for payments the lawsuit finds improperly withheld.

Although a change in NCAA rules allowed players to be paid for the use of their name, image and likeness, often through sponsorships and advertisements, the lawsuit argued that the NCAA restricts how much student athletes can earn outside of employment. For example, the lawsuit says that an NCAA statute, which regulates the jobs athletes can hold at their universities, “specifically prohibits athletes from receiving ‘any remuneration for value or utility that the student-athlete may have for the employer ( external) due to the publicity, reputation, fame, or personal following he or she has obtained due to athletic ability.”

In a joint statement, leaders of the five conferences and the NCAA said they hope the agreement can be an important moment in reforming the world of college sports.

“This agreement is also a roadmap for college sports leaders and Congress to ensure this uniquely American institution can continue to provide unparalleled opportunities for millions of students. All of Division I made today’s progress possible, and we all have work to do to implement the terms of the agreement as the legal process continues. We look forward to working with our various student-athlete leadership groups to write the next chapter for college sports,” read the statement, which was attributed to NCAA President Charlie Baker, ACC Commissioner Jim Phillips, Commissioner of the Big Ten Commissioner Tony Petitti to Big 12 Commissioner Brett Yormark, Pac-12 Commissioner Teresa Gould and SEC Commissioner Greg Sankey.

While it’s unclear what immediate effect the settlement will have on college sports, it has been clear for some time that a reckoning was coming — especially following the rule change surrounding NIL compensation in 2021.

This rule change, combined with a loosening of transfer rules, has caused players to bounce from school to school in search of a better NIL deal, when in the past they would have been forced to remain at their original school for the entire four years of eligibility or run. the risk of missing out a year after a transfer.

Increased use of the transfer portal by athletes, commissioners said, has become problematic in college sports, especially for student-athletes seeking to earn a degree. They said college boosters have taken advantage of the current patchwork of laws to help their universities recruit the best athletes by promising big payouts — to the detriment of colleges in other states that are forced to play by a different set of rules.

The lack of regulation surrounding the NIL has created something of a Wild West atmosphere in college sports that the NCAA now hopes to somewhat reduce.

The reported revenue-sharing plan could help smaller schools that may not have rich NIL collectives remain on a more level playing field with the big-name schools that do.

This story has been updated with additional reporting.

CNN’s Ben Morse contributed to this report

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