UND plans to spend nearly $1 million annually in Alston Awards to athletes

Jul. 14—GRAND FORKS — The Supreme Court's unanimous 2021 ruling in the NCAA v. Alston case opened the door for college athletes to be compensated in new ways.

For the first time, athletes were allowed to profit on their name, image and likeness (NIL), setting off a flurry of deals for top athletes as well as questions about what's legal under NCAA legislation and what's sustainable financially.

UND is launching a program this fall that will take advantage of a different aspect of the Alston ruling — an academic-related stipend.

Schools are allowed to pay each athlete a maximum of $5,980 per year for an academic achievement award.

UND will spend about $960,000 annually in its program, the 701 Award, athletic director Bill Chaves said.

The money will be distributed equally between men's and women's teams. Every team will get a dollar allotment, though not all will be the same. Chaves has informed each head coach of its team allotment. He did not reveal those numbers, though.

Each coach can split the money in any way.

In order for athletes to receive the award, there are stipulations based on academic performance and retention.

UND is using the NCAA's Academic Progress Rate as the standard for the academic piece. APR scores, calculated by the NCAA, measure eligibility and retention rates. Schools and programs can receive rewards for superior academic performance and penalties if they do not hit benchmarks.

"It's incredibly important for all of our programs to have the highest APR possible," Chaves said.

To qualify for the retention piece of the 701 Award, athletes must either remain at UND, graduate or turn professional. Transferring athletes, who have not graduated, will not receive money from the 701 Award. Those who run afoul of university policies or the law also could lose their stipend.

Graduate transfers are still eligible to receive the stipend.

Payments will come twice a year. The first will be in February. The second will be either in May or August. Athletes graduating or turning pro (assuming they meet their academic requirements for the semester) will receive payments in May. Non-graduates will receive them in August.

All athletes, not just scholarship ones, are eligible to receive the award.

Cost of attendance scholarships — which are designed to cover costs beyond tuition like books, housing and meals — are directly connected to the athlete's percentage of scholarship. For example, if an athlete is on a 40 percent scholarship, that athlete can receive 40 percent of the cost of attendance.

That's not the case for the 701 Award. Scholarship and non-scholarship athletes are eligible to receive the award.

Roughly half the funding will come from the athletic department, which made budgetary adjustments in recent years to open up money, Chaves said. The other half will be funded, initially, by strategic investment dollars from the university.

"The university is assisting us for a period of time, so our fundraisers can get on the road and get donors excited about it," Chaves said. "In the short term, we've already met with certain folks and they're excited about it."

The UND Alumni Association and Foundation

has launched a webpage

seeking donations for the 701 Award. Mike Mannausau, the vice president of the Alumni Association, said his team is currently informing donors about the program, why they're doing it and how it will help.

"We made decisions three-to-four years ago to put us in a revenue model where we're able to do this," UND deputy athletic director Erik Martinson said. "We're really proud of what we're trying to do and where we're doing it."

Martinson said he believes UND is "one of the first and few at our level" to be giving Alston Awards.

North Dakota State does not currently offer them. South Dakota State and the University of South Dakota did not provide an answer by the time this story ran.

"We feel we've made a thoughtful decision for us," Chaves said. "I think we're there as far as being on the front end of this, but I've gotten to the point where I worry more about what's right for us (than about what other schools are doing). We feel it's the right thing for UND."

Some UND athletes have benefited from name, image and likeness deals.

Jake Sanderson, a men's hockey star, and Kacie Borowicz, a women's basketball standout, have profited as brand ambassadors. Men's hockey players Judd Caulfield and Ethan Frisch launched hockey camps using their names.

The university has been supportive of athletes in those pursuits.

But much of the publicity about NIL deals is related to collectives — a method where a group of donors pool money together and offer sums of money for athletes. At major programs, some athletes have made six figures from collectives.

Currently, there is no collective paying UND athletes. Privately, officials at the school don't mind that. They've been leery about the idea.

For starters, a collective would compete against the UND Alumni Association and Foundation for money from the same donors.

Second, there are never guarantees an athlete will get what's promised from an NIL collective. In one case earlier this year, quarterback Jaden Rashada requested out of his National Letter of Intent to Florida, because an NIL deal fell through. Rashada ended up at Arizona State.

Third, the future of NIL is murky.

The IRS recently issued a memo suggesting that donations made to NIL collectives are not tax exempt.

And the way some programs have been using NIL collectives may be against NCAA rules.

Within 24 hours of the final out at the College World Series — the NCAA's last event of the season — the NCAA sent out a Q&A to members clarifying some NIL activities are impermissible.

Here's a sampling of them:

* Question: Are boosters or a collection of boosters permitted to have contact with prospective student-athletes (PSA) and discuss potential NIL opportunities should the individual decide to attend a particular school? Answer: No. A booster or collection of boosters is not permitted to engage in recruiting activities, including recruiting conversations. When a booster's interaction with a PSA includes encouraging the PSA to attend an institution, NCAA rules have been violated.

* Question: It is clear that institutions may not compensate a student-athlete for use of NIL. Is it permissible for an entity closely associated with an institution to compensate student-athletes for use of their NIL? Answer: No. Institutions may not use NIL transactions to compensate student-athletes for athletics participation or achievement or as an improper inducement. Any entity that is so closely aligned with an institution that it is viewed as an extension of the university is subject to the same NIL scrutiny as the institution and must adhere to NCAA rules and policy. This includes the prohibition on compensating student-athletes for use of their NIL. Further, institutions are accountable for such entities since they meet the NCAA's definition of a booster — even if the group is formed as a separate 501(c)(3).

"It would seem, at this moment, the definition of NIL has different interpretations around the country," Chaves said.

With the 701 Award, it is something coaches can promise athletes during the recruiting process, unlike NIL deals.

"We can talk about it," UND women's basketball coach Mallory Bernhard said. "It's tangible. It's real. You know what it is. You hear a lot of things (about NIL), but what are you hearing that's accurate and what's not accurate? We know what this is."

Bernhard said a benefit to Alston Awards is they can be given to foreign athletes, because it's an academic-based award. NIL money cannot.

A third of the women's basketball roster is from Canada. More than a third of the men's hockey roster is foreign. And nearly half of the tennis rosters are comprised of overseas players.

"I think it's awesome our administration is placing an emphasis on doing something like this and being at the forefront and being leaders on this," Bernhard said. "This will 100 percent be conversations we have in the recruiting process. I hope it has an impact."

For UND's Summit League and Missouri Valley Football Conference teams, it gives them something their rivals don't have.

"We feel like we're going to be a leader in this area when compared to our peer institutions," UND football coach Bubba Schweigert said. "It gives you something to really sell to your current team and to sell to recruits and families. It's another step in what our administration feels we can do to better ourselves and support athletics at the University of North Dakota. It also shows the donors the direction we want to go. We want to keep doing things to help us attract the best student-athletes we can to compete here at UND."

Schweigert said the 701 Award can be particularly helpful for those who are on partial scholarships or none at all.

"It's a great help to individuals and their families," he said. "Overall, I really believe our university has recognized what athletics can do for the university. I know as the coach of the football team, it's greatly appreciated. We work hard to sell to our team what we mean to the university and how we represent the university is really important."

For the men's hockey program, it's now catching up to some rivals. Big Ten schools already are giving Alston Award payments.

The timing helps for hockey, too.

Aug. 1 is the opening day for college hockey programs to offer high school juniors. UND can now inform potential recruits of the 701 Award.

"I know some programs are already doing it, the Big Ten, and others at their own pace," hockey coach Brad Berry said. "A big thank you has to go out to Bill Chaves and Erik Martinson for diving into it and making it happen.

"You can bring someone to campus and you can show them what you can offer them as far as development, with your program and academically. When you're (recruiting) against some other top-end schools with their budget and arsenal, it's a situation where we now have this and are on pace with Big Ten schools and others who have it."

* Challenges to the NCAA's restrictions on educational compensation for athletes was raised by Shawne Alston and Justine Hartman.

* The Northern District Court of California ruled against the NCAA in March 2019. It was upheld by the Ninth Circuit in May 2020.

* The Supreme Court ruled against the NCAA on June 21, 2021, by a 9-0 vote.

* In July 2023, UND announced it will start its 701 Award program.