We Should Use Fan-Funded Escrow Accounts to Pay NCAA Athletes
Big-time college sports are business-like in all areas except one: paying its labor force a competitive wage. While some fans see this as the charm of college sports, most understand that the times have changed. And as long as the NCAA refuses to pay student athletes, the once-revered institution of college sports will continue to lose legitimacy.
This will open the door for alternate collegiate athletics organizational structures to better serve the economic reality of the times. Indeed, I propose that the fans can precipitate massive institutional change in a simple way: by pooling fan payments for NCAA athletes online, and placing these funds in an escrow account until the athlete leaves school. When a student-athlete is no longer enrolled, they are disbursed this escrowed, fan-funded compensation.
Here’s how it would work:
- A fan starts an athlete-pay page. For example, the campaign might pay Johnny Manziel to come back for his junior year at Texas A&M, and not enter the NFL Draft.
- Other fans contribute money. They also want to see see Johnny Manziel come back to school. They’re willing to pay him for it, and so they contribute funds to this campaign, on the condition that he returns.
- Finally, either:
- Manziel enters the NFL draft and/or does not return to school: then the escrowed funds are refunded to the contributor in full. OR
- Manziel returns to school: then the escrowed funds are distributed to Johnny Manziel only after he graduates and/or leaves school.
Imagine Manziel is on the fence about going pro. All else equal, he might want to come back and play another year of college football. But, understandably, the money might simply be too much to pass up.
If there were an award for him to come back, perhaps as little as $50,000 or as much as $5,00,000, would this additional information change his decision-making process? Of course it would.
So who wins in this scenario? Well, all stakeholders win, except maybe the NFL, who is accustomed to getting a relatively cheap supply of labor (partly because the alternative, staying in school, is so low-paying). So, then:
- Johnny Manziel wins. He’s able to get paid for the service he provides. He’s able to make an arguably “fairer” and better-informed decision.
- Texas A&M wins. They get their Heisman winner back for another year of stunning media exposure and fundraising success. In the year of Johnny Football, Texas A&M raised $740 million, exceeding the previous funding record by 70%.
- The contributors win. They get to pay him for a service they’re willing to pay him for. They might even feel good about it.
- The online marketplace wins. It makes a cut of the payments.
- The fans win. They get to watch him play for another year.
- The team and coaches win. They keep their best players.
- Sports media wins. How much money has ESPN made off Johnny Manziel?
- And, college sports win. Imagine when college basketball one-and-doners now have a pot of gold to induce them to stay, play basketball, and enjoy their time in college. What competition would result!
Is this proposal legal per NCAA guidelines? Yes, because the player is not accepting any funds while playing. Is this legal otherwise? Yes, because we are simply paying an individual for a service he or she provides us. After all, those fans who believe that NCAA athletes should be compensated for their services should understand that the NCAA does not have a monopoly on who we can and cannot pay for services we decide are valuable.
In the “pay for play” debate, the moralistic “What is fair?” question—while of course the supremely important question—ultimately overlooks the immense opportunity at hand. We should focus our efforts instead on this question: “How we design a better way to recalibrate the economics of college sports?”
It’s painfully obvious that the NCAA refuses to innovate with its economic structure. And so we could and should take matters into our own hands. You can start here.
NOTE 11 Dec ’13: If a player “accepts” any “promise of pay”, it’s against NCAA rules, per Bylaw 12.1.2:
Bylaw 12.1.2 Amateur Status
An individual loses amateur status and thus shall not be eligible for intercollegiate
competition in a particular sport if the individual:
(b) Accepts a promise of pay even if such pay is to be received following completion of intercollegiate athletics participation;
Still, what does “accept a promise of pay” mean? I don’t see how the NCAA could sanction the school retroactively if a player took funds after he graduated, but never accepted any “promise of pay.” After all, what could the school have reasonably done to prevent this infraction? After graduation / leaving school the school would have no control over the former player.
And just because its against NCAA bylaws doesn’t mean fans can’t do it of course. It might serve as a tool that most clearly illustrates the “unfairness” of the NCAA situation: “You’re saying this former player cannot claim thousands of dollars remuneration because that would be a violation to the school?!” In such a case it might induce reform.
Let me know your thoughts at email@example.com.