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Texas To Pay Student-Athletes Additional Benefits

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Earlier this week at a Big 12 forum in Washington D.C., University of Texas athletics director Steve Patterson announced that the school would begin to pay its players.

This — equally monumental — decision by Texas, comes after Judge Claudia Wilken’s landmark ruling against the NCAA in the O’Bannon suit from back in August. Wilken declared the NCAA was violating antitrust laws that were put in place as a conspiracy by the NCAA and its member institutions, to prevent student-athletes from receiving shares of the revenue. Wilken also stated that the association couldn’t stop players from making money on their own names, likeness, and images. This includes revenue from video games, and compensation for any media or broadcasting contracts, as well.

“We’re in for a period of dynamic change. The system has to change. The money needs to be handled differently,” former Maryland basketball star, and U.S. Representative Tom McMillen said.

In the eyes of most, the injunction paints a balanced, win-win situation for all parties involved. The “payments” will be capped at $10,000 per student-athlete, and give the schools flexibility based off revenue, to decide how money will be allocated.

For Texas, the school has set aside $6 million to be flexed out to every sport, not just men’s basketball and football. Most schools see Texas’ paramount decision as unfair, but considering that from 2011-2012 the University of Texas generated $163.3 million in revenue — $103.8 of which was off football alone, it’s in the position to do as it pleases.

Let’s be realistic and conclude that most schools won’t be able to take on that dollar amount, especially post-recession, but under autonomy, it’s likely that stipends will increase by several thousand dollars to compensate for the cost of attendance. Any additional money will go into trust funds that student-athletes will receive after their eligibility has expired, or when they graduate. The only real downside to the ruling, is that if a school doesn’t use a student-athlete’s name, likeness, etc. and no money is made, it doesn’t have to put money in the trust fund. Regardless, student-athletes in that situation will still receive an increased stipend, and I imagine member institutions will have to disperse ledgers so players know if they’re being fairly compensated — if at all.

Of course this will change how recruits compare options, but I believe it will still allow for competition because a key objective for many top recruits, is potential playing time at their various options. The opportunity for student-athletes to compete early on is a substantial selling point for any athletics program.

There will be casualties as a result of this reform, for example, cutting programs altogether, but the formal announcement on when Texas or other schools will begin paying student-athletes is unknown, so schools still have time to make their own tailored decisions.

 

*Section Photo credit to Erich Schlegel, Getty Images; Featured Photo (above) credit to Deborah Cannon, AP

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