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You are paying for your favorite college athlete now: ‘the next stage of the arms race’

Fortune ·
You are paying for your favorite college athlete now: ‘the next stage of the arms race’

Win or lose, the North Carolina Tar Heels already will be in elite company when they kick off the college football season against Texas Christian University in a game played in Dublin.

They will be among a small but growing number of athletic programs receiving taxpayer funding from their home states.

With universities competing to pay athletes millions of dollars, some states now are propping up their strained sports budgets in ways not previously seen.

The state dollars aren’t going directly to star athletes.

But by funding facilities and administrative costs normally borne by the schools, states are freeing universities to use their own dollars for other purposes.

The athletics program at the University of North Carolina at Chapel Hill, for the first time, is receiving $3 million earmarked from state sports betting taxes.

Wisconsin lawmakers approved $15 million for athletic costs at the University of Wisconsin.

And Connecticut and Louisiana also are using tax dollars to support college athletics.

Even more states have considered it.

Sports business analysts see an emerging trend.

“Once one state provides that kind of assistance, schools in competing states can argue that they are being placed at a competitive disadvantage, which could create additional pressure on legislatures to respond,” said Daniel McIntosh, faculty director of the sports business program at Arizona State University.

Legal cases have accelerated spending on college athletes NCAA rules long barred college athletes from getting paid by schools and boosters.

But under pressure from lawsuits and states, the NCAA cleared the way in 2021 for athletes to receive money from private entities for the use of their name, image or likeness (NIL).

Then a legal settlement last year allowed higher education institutions to directly pay athletes a total of about $20.5 million annually — on top of any scholarships and other NIL deals they receive.

Read the full article on Fortune ›

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