Student-Athletes Are Getting Paid, Fans Begin To See Growing Share Of Bill

ASSOCIATED PRESS – At Tennessee, they are adding a ‘talent fee’ to the price of sports tickets. At Arkansas, they will charge 3% more at the concessions stands. At Michigan and Michigan State, athletic directors sent letters alerting boosters that winning is going to start costing more. And, in a first, Clemson is going to start adding an athletic surcharge to tuition bills.

Winning at big-time college sports has never been free, but in a rapidly changing era in which players are allowed to earn money and be paid by their own schools, it has never been clearer that fans will be picking up a bigger part of the tab.

NCAA President Charlie Baker on the urgent need for Congressional intervention to address pressing issues and challenges within college athletics: pic.twitter.com/EGjqYUhB4j

— NIL vs NLI (@NILvsNLI) November 5, 2024

“College athletics hasn’t professionalized as much as I think it was capable of,” said Nels Popp, a University of North Carolina sports-business professor who believes most schools still rely on fans’ emotional, long-held school ties more than bottom-line marketing strategies. “And now, I think this is forcing them in that direction.”

When the NCAA reluctantly approved payments to players for use of their names, images and likenesses (NIL) in 2021, boosters who used to give to schools and their athletic departments started funneling money to collectives — independent organizations that raised the money and paid the athletes. Those collectives are becoming more and more closely linked to the universities.

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Under terms of a $2.8 billion lawsuit settlement that is on track to take effect next year, the NIL deals will remain in full force and the schools themselves will be dealing with other multimillion-dollar changes to their bottom lines, including:

— Each school with the money to do it will be allowed to share as much as $22 million in annual revenue with athletes — money they get from tickets sales, TV contracts and other sources. They can share less, but top recruits will be front of mind in the arms race for talent.

The Director of NIL at @NCAA Derrick Coles speaking at one of our panels at the 2024 NIL Conference. pic.twitter.com/JDBn8jCe2g

— Silver Waves Media (@SilverWaveMedia) October 31, 2024

—The amount the NCAA pays more than 350 Division I schools every year is going to drop. The organization is on the hook to cover some $1.2 billion in damages under the settlement and the rest will be covered by conferences that will see less money shared each year from the NCAA and its lucrative men’s basketball tournament.

— Schools will be allowed to offer more scholarships across all sports and that costs money. For instance, a school could offer up to 20 additional scholarships for a total of 105 in football. Michigan athletic director Warde Manuel said adding scholarships across sports could add $29 million in education costs to the department’s bottom line.

And that’s on top of the revenue sharing.

“Maintaining a high level of support for our 29 NCAA athletic programs will take an elevated commitment from everyone,” Manuel wrote to Wolverines fans last month.

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One possibility for Michigan might be placing advertising inside of Michigan Stadium, a practice the Wolverines have steadfastly avoided over the decades. The school also sent out a recent survey asking, among other questions, if fans were willing to pay between $3,000 and $4,000 for a new tranche of chairback seats, which are rare outside of club sections at The Big House.

Not all fans are signing on amid ‘donor fatigue’

In 2023, it cost two fans an average of around $180 to attend a college football game and about $340 to go to an NFL game. After all, college sports didn’t have to worry about the biggest expense on a pro team’s budget — player salaries.

NIL started chipping away at that, and once the terms of the lawsuit settlement go into effect, that dynamic will shift even more. Michigan State AD Alan Haller told Spartans fans his department’s ’25-26 budget will include between $25 million to $30 million in added expenses.

“As a department, we will continue to explore new opportunities for both revenue generation and cost containment,” Haller said. “However, without a doubt, your continued generosity and involvement will be paramount to our quest for excellence.”

Some fans will undoubtedly keep writing checks to keep the players — and hopefully, the wins — coming, along with retaining their “rights” to buy a certain number of tickets for football games.

A tour around the parking lot before this season’s Michigan-Michigan State game found others who sounded more reluctant.

“The price of the education is out of hand,” said Michigan State fan Mike Bouchard, citing a more than $55,000 price for an out-of-state undergrad to attend his alma mater. “There’s absolutely no way I’m going to dig into my pocket over and above that amount. Tell them to use their hundreds of millions in endowments.”

The Big 12 is looking to get a head start on the fallout from the proposed settlement between the NCAA and The House.

More on the league's “NIL agreement template” ⬇️

— Front Office Sports Today (@FOS_Today) November 5, 2024

“Absolutely not,” said Ann Arbor resident Michael Ketslakh when asked if he would give more to support Michigan athletics. “I think it’s excessive. It’s bad for the sports.”

Rick Karcher, the faculty athletics representative at Eastern Michigan, said fans continue to pay because, unlike pro sports where everyone knows the profits go to billionaire owners, the economic models in college are often hard to nail down.

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“College sports fans, students and boosters are willing to continue absorbing the operational costs while the team’s coaches and administrators get richer because they view athletics as separate from the university,” he said.

Schools look for other ways of absorbing higher costs

Earlier this fall, Texas Tech said it was budgeting $14.7 million for this fiscal year — about $9 million more than the previous year — in support for the athletic program, which has a budget of nearly $129 million.

“I think if any unit on this campus was facing a 20-something-percent cut in their revenue, we would have to look at how we might respond, and we will in this case,” school President Lawrence Schovanec explained.

Texas Tech is hardly alone in contributing to its athletic program, but not every school runs by the same model. At Florida, for instance, sports are run by the University Athletic Association, which not only has funded sports but has often given money back to the school.

A story in the student-produced Florida Independent Alligator said UF sports revenue was eighth-highest in the nation; two of its biggest boosters have given eight-figure sums to the UAA’s fundraising arm.

Clearly, though, it’s not only eight-figure donations that will keep college sports running.

Tennessee was among the first to grab headlines early in the football season when AD Danny White said the school was adding a 10% “talent fee” for 2025 football ticket renewals. That was on top of a 4.5% hike in ticket prices.

“That connection between resources and competitiveness has never been tighter,” White said. “Only now we have the ability to share these resources with our athletes.”

At Arkansas, AD Hunter Yurachek explained the 3% fee on concessions in a letter to fans that noted the importance of continuing to “maximize additional revenue opportunities” At Clemson, which long prided itself on not charging fees or ticket prices to students, the plan is to raise between $7 million and $8 million by adding a $150 “athletic fee” per semester to the price of tuition. The Tigers have been to four national title games over the past decade and won it twice.

“I think it’s kind of ridiculous, but there comes a point when we have good enough sports teams that it’s kind of valid,” student Sam Gault told South Carolina’s WSPA-TV when the fee was unveiled earlier this month.

To win big, schools will have to pay big, and simply fielding a competitive team is no longer a given. The question hanging over college sports is where the money will come from.

“You can pay more for tickets, put a sponsor patch on the uniforms, cut non-revenue sports or (start calling) the Big 12, the ‘Dr. Pepper Conference,'” said Popp, the professor at North Carolina. “I don’t think fans are anxious for any of those, but what might they be willing to accept? I think that’s what athletic departments have to figure out.”