Tuesday, August 19, 2008

Myles Brand, the $935,000 man

A lot of you out there might not know who Myles Brand is. Well, he is the President of the NCAA, which means he is the President, and public face, of college athletics. I've have argued many times on this blog that college athletes, especially those in revenue generating sports like basketball and football (which basically provide athletic departments with their budgets) should be compensated with more than just a scholarship, and I am about to do that again.

The reason I bring this back up is that last week, the NCAA released its annual financial disclosure forms for the 2007 year, an IRS requirement for tax-exempt organizations such as the NCAA (they are tax-exempt because they "keep sports as an integral part of the educational program and the athlete as an integral part of the student body"). In this document, they announce the salaries of some of the top NCAA officials. Nine make more than $275,000 a year, topped by Brand's $935,000, which is more than the president of any school that is an NCAA member and a 4% raise from 2006.

With our economy in the crapper, Fannie and Freddie following Bear's lead, job's flowing abroad, and the student-athlete continually taken advantage of, it only makes sense to give the guy who is best known for not implementing a BCS playoff a raise, right?

The NCAA, which lists 434 employees and $608 million in revenue (I am not sure how they get this number, because CBS pays around $545 million a year for the NCAA tournament), also paid just under $1 million for charter air travel and $18.6 million in attorney fees and a fund for former athletes after they were sued because some former athletes did not receive the full cost of their education. So clearly, the NCAA does not have a cash flow problem.

But the NCAA's exploitation of collegiate athletes is getting worse. CBS Sports now offers a fantasy football game with individual players names. In past years, Yahoo and the Sporting News have offered a type of fantasy game - Yahoo's game involved picking winners of top 25 games, where as at the Sporting News you picked team positions (i.e. Notre Dame's running backs). But this is the first time that a site has been able to use the names of the players, which I'm sure CBS paid a pretty penny for. So not only are these players having money made off of their jersey sales (I know the names aren't on the jerseys, but if you've bought a #50 UNC jersey in the last three years, I'll bet you're not getting it because Brian Bersticker wore it), the ticket sales to their games, and revenue from televised games, there is now money being made off of their names?

In the past, I've said that athletes should receive a small stipend just so that they have a little bit of spending money in their pockets (well, legitimate spending money anyway), and in theory that could work if regulated correctly. But in reality it would be very difficult, mainly because athletic departments, for the most part, run at a deficit as it is. So paying players is not really all that practical, and imagine what would happen if agents and boosters were actually allowed to spend time together. You think it is corrupt now?

I know all of the arguments against paying players - they are receiving a scholarship (which can reach six figures at many schools), they are amateurs, they already get paid by boosters (kidding, sort of), etc. But the best argument, and the one that has me leaning in this direction right now, is that playing a sport in college is actually a choice you make. In most sports, there are options. Brandon Jennings went to Italy to get around an age limit. Mike Sellers went to Canada. Baseball players can go pro straight from high school.

But it still is not fair to profit off of these athletes without them seeing a cut. So instead of just flat out paying the players, why not set up a retirement fund (401k, IRA, something like that) which would allow these players to access at least a piece of the money being made off of their likeness, given that they complete their degree? The fund can be supplied by the NCAA, the venues that host the NCAA tournament games, the people that advertise at and during sporting events, and the merchandisers and websites that use the players to make money, be it fantasy sports or jerseys sales.

This not only allows the players to (eventually) see some of that money, but it creates a strong incentive for them to actually graduate. And the only people that get affected negatively? The people already making all the money.

4 comments:

matt said...

I like the idea of setting up a retirement plan along the lines of a 401-k/ IRA. But if you are going to set up an IRA or something along that line they should only receive the money if they graduate. They should not be able to accumulate money towards retirement, play one,two or three years and then get the money. They would need the diploma to get that money put away. Also guys who make it big and graduate (alla Tim Duncan) should not get the money it should be going back into the pool.

It is hard to criticize Miles Brand for getting the money he does. He is running a huge "corporation." During his time he has put the NCAA on the map. Even though the BCS is illfated, it still gives a champion vs the arbitrary voting that took place before. Now there is a real championship game. And March Madness has taken off since he took over. Heads of large corporations make a lot of money, it is what it is.

Rob Dauster said...

I agree that they should have to get their degree, and I think I wrote it in the post.

And I'm not really criticizing how much he is making - because he does manage a huge corporation. I'm just questioning whether or not he deserves a raise.

jon said...

Regarding your first paragraph, only 16 programs in all of NCAA sports generate revenue. See: http://www.insidehighered.com/news/2008/05/16/ncaa; specifically, "In the 2006 fiscal year, the latest of three examined in the study, only 19 of the 119 Football Bowl Subdivision institutions had positive net revenue, while for the rest, expenses exceeded generated revenues. (For the entire three-year period, only 16 athletics department turned a net profit.)"

Also, as you state, the student-athlete gets the great benefit of attending a 4-year college (at times for free or highly subsidized by various scholarships), something that many others do have the opportunity to take advantage of. Assuming they are not NBA or NFL bound, and they take advantage of this opportunity, their earning power increases significantly.
And lets not forget the fact that being an athlete comes with significant perks (esp the major conf schools): chartered flights, nice hotels for road games, meal money, locker rooms and training staff that rival professional sports, etc.

Rob Dauster said...

@jon - thanks for that link. I knew it was true, I just didn't have the stats.