While Congress and NCAA squabble, NIL collectives lead push on revenue sharing

INDIANAPOLIS — In a boardroom within a downtown hotel here this week, athletic administrators, as well as others, are gathering to explore potential solutions for a vexing issue that, they say, has hurled college sports into chaos.

Name, image and likeness (NIL) is at the center of a two-day stakeholders meeting that began Tuesday. While no report or legislation is expected immediately from the gathering, administrators and invited guests hope to examine NIL in a way that produces answers.

One group — not invited to the meeting — believes it has some already.

The Collective Association (TCA), a group of seven of the richest donor-led collectives in the country, is preparing to take the next step in the conversation. While college administrators squabble over legislation around NIL, leaders of the TCA are focused on what many believe is the next evolution of athlete compensation: revenue sharing.

Members of TCA presented a revenue-sharing model to SEC and NCAA officials last week in separate meetings — which illustrates the urgency for answers from high-ranking figures within college athletics. The proposal is merely a general framework of a plan that calls for using television network money to compensate athletes.

According to the proposal, which was shared with Yahoo Sports, a portion of the television revenue distributed to conferences would be directed to a designated collective at each member school in equal shares. The collective would then distribute money to that school’s athletes, using its status as a third party as a way to avoid triggering athlete employment, they said.

The aggressive proposal is certain to face significant hurdles in both legality and acceptance among a college landscape that continues to cling to the amateurism model. However, the movement could spark a conversation that many are already holding privately within NCAA circles.

That’s the point, said Matt Hibbs, the CEO of the Classic City Collective supporting Georgia athletics.

“We want to have this discussion. We want to have a conversation about solutions,” Hibbs told Yahoo Sports when contacted about the meetings with both SEC and NCAA executives. “The important piece we all want is to preserve college athletics. In order to do that, something has to change. We can’t keep doing what we’re doing and hope this just works out.”

NCAA officials and leaders in the college sports landscape are trying to figure out how to move forward with name, image, likeness (NIL) and potential regulations. (Andy Lyons/Getty Images)
NCAA officials and leaders in the college sports landscape are trying to figure out how to move forward with name, image, likeness (NIL) and potential regulations. (Andy Lyons/Getty Images)

Collective members held meetings with SEC associate commissioner William King, who oversees legal affairs and compliance, as well as NCAA managing director of academic and membership affairs Geoff Silver. Hibbs declined to confirm specifics of the meetings, only describing them as “positive.” The two officials were “open to further collaboration” and conversation with TCA leaders.

An NCAA spokesperson would only confirm that a meeting took place. An SEC spokesperson did not provide comment.

Asked last week about a potential meeting with collectives, SEC commissioner Greg Sankey told Yahoo Sports, “There is a curiosity of what is their intent.”

“It’s incredibly significant that individuals in those positions are eager to hear our opinions and are open to new ideas,” Hibbs said. “They agreed that having outside opinions is exactly what is needed.”

Collective leaders plan to hold conversations with officials from other leagues as well. Four Power Five conferences are represented among the group. There are three from the SEC: Classic City Collective (Georgia), Spyre Sports Group (Tennessee) and The Grove Collective (Ole Miss); two from the Big Ten: Champions Circle (Michigan) and Happy Valley United (Penn State); one from the Pac-12, soon to be Big Ten: House of Victory (USC); and one from the ACC: The Battle’s End (Florida State).

The seven collectives have combined to distribute nearly $70 million to more than 1,500 athletes, according to figures they provided. Officials expect to grow TCA to more than a dozen members eventually.

Collective staff members consider themselves as front-line workers in a recruiting and retention personnel race that has consumed the higher reaches of college football and basketball. They say that they are uniquely positioned to formulate ideas based on their on-the-ground work in NIL.

“We are one of the few entities that touches every aspect of NIL. We talk to athletes, agents and everybody else in between,” says Ingram Smith, the CEO of FSU’s The Battle’s End. “There’s got to be a solution to this. We need to contribute to the solution.”

In a striking comment, even collectives themselves acknowledge that the current model is not sustainable.

“This is something that can last another two to three years,” Smith said. “The idea that three to four people are footing the bill for 90% of a school’s NIL presence is not sustainable.”

Once considered a shadow industry — the dark underbelly of NIL — the collective space has continuously evolved, both in reality and in perception. Many collectives are well-organized companies, often led by sports agents or attorneys, that employ more than a dozen staff members who mine a healthy group of donors. They often use platforms such as Opendorse to assure they are abiding by NCAA policies.

NCAA president Charlie Baker wants Congress to pass a federal law to regulate the way college athletes can be compensated for their name, image and likeness. (AP Photo/Darren Abate, File)
NCAA president Charlie Baker wants Congress to pass a federal law to regulate the way college athletes can be compensated for their name, image and likeness. (AP Photo/Darren Abate, File)

In conversations with both SEC and NCAA officials, collective leaders have made clear that they actually hold similar views as athletic administrators. They want to be regulated, believe fair enforcement is necessary and they support the creation of a nationally uniform NIL policy as well as an agent registry.

“People are afraid to endorse or have dialogue around these things like revenue share,” says Walker Jones, the CEO of The Grove Collective. “But we can stick our heads in the sand or we can talk about it. A win for our group is let’s have these discussions and poke holes in things. Let’s challenge ideas and thoughts.”

There are obvious issues with TCA’s proposal, experts tell Yahoo Sports, most notably: (1) a potential, if not probable, violation of Title IX; (2) the triggering of athlete employment status; (3) antitrust issues around the designated distribution amount; and (4) violations of a league’s television contracts.

But that doesn’t mean the plan isn’t a solid starting point, says Michael LeRoy, an Illinois law professor who has published extensive work on labor policy.

“My first thought is, it’s creative. It’s innovative,” said LeRoy. “It seems like it would stabilize the ruinous competition from one school to another by having a conference-based distribution model, in terms of not allowing one team to distort the market.”

However, LeRoy believes that the proposal is a “thinly veiled employment relationship.”

There is irony in this. While college leaders are staunchly against employment — and that goes for many athletes as well — an employment model, or at least a unionization/collective bargaining model, could be a solution to leveling the playing field.

“I think employment would stabilize competition among schools,” LeRoy said. “It would drive some out, but that’s already happening. Smaller schools can’t keep up with the Georgia's and LSU's.”

In a Senate hearing earlier this year, Jason Stahl, the founder and executive director of the College Football Players Association, publicly implored college leaders to embrace a system that features collective bargaining. Stahl said then that he’s held conversations with coaches at unnamed programs who are in support of such a system.

It’s true. Since Stahl’s comment, several coaches have gone public supporting a more direct pay system for college sports, most notably Penn State’s James Franklin, UNC’s Mack Brown and Alabama coach Nick Saban.

“Unionize it, make it like the NFL,” Saban said in May. “If it's gonna be the same for everyone, I think that's better than what we have now.”

Stuck in a sort-of purgatory between amateurism and professionalism, college athletics seems to be crawling incrementally toward a more regulated compensation framework. Many believe that it’s time to get there as soon as possible. And if leaders within college athletics don’t make the decision themselves, then an outside entity will make the decision for them.

Several pathways to a new college compensation model are in the process of working their way through the judicial and executive branches of government. In the courts, a case in Pennsylvania (Johnson v. NCAA) could deem athletes as employees, and in the executive branch, the National Labor Relations Board is on the way to ruling athletes as employees.

“We are trying to come up with a model,” said Hunter Baddour, the founding partner and president of Tennessee’s Spyre collective. “Even collectives have to compromise a little bit, but it’s better than this getting to the courts and blowing up this system.”

As all plans do, TCA’s proposal has holes, the most prominent of which is an infringement on Title IX, the federal law that requires universities to distribute benefits to male and female students equally.

In the current NIL environment, collectives and their schools may already be toeing the line in violating the law, some believe.

“There are Title IX implications even under the current status, much less moving toward something where clearly the institution or conference is sending money to collectives to use in a different way,” said Amy Perko, the CEO of the Knight Commission, which promotes reforms that support and strengthen the educational mission of college sports. “The collectives are acting as an arm of the institution.”

In the proposal, TCA is suggesting that 10% of a league’s total television distribution get designated to athletes. Earlier this year, the SEC announced a distribution of $721 million to its schools — roughly $50 million per school. Under the proposal, each SEC school’s designated collective would receive $5 million to pay athletes. Exactly how the collectives would distribute the money among athletes has not been vetted, but TCA leaders are open to suggestions.

This raises antitrust issues, says Julie Sommer, a member of the Drake Group and an expert on NIL matters.

“If the TCA is purporting to represent and agree on behalf of the athletes on this 10% figure — a fixed amount — the NCAA can’t grant that antitrust exception,” she said. “Nor can the conferences. Only Congress can. Even if they negotiate it directly with the athletes. It still doesn’t get around Title IX concerns.”

The evolution of athlete compensation is one of the most hotly discussed topics, most of it coming from behind closed-door meetings among NCAA and conference leaders. Any attempt to give more benefits to athletes directly from the school is a risk to both triggering employment status — a spooky word among administrators — and impacting ongoing lawsuits that could cost schools billions of dollars, such as House v. NCAA, which seeks retroactive NIL payments.

Like employment itself, revenue sharing is a divisive issue among college leadership. In fact, a revenue-sharing bill in the California state legislature was rejected this summer amid pushback from NCAA and college officials. The bill is expected to be revived next year during California’s session.

The topic has caused riffs in Congress, where NCAA leaders are encouraging lawmakers to pass federal NIL legislation. There is a deep divide on revenue sharing and employment among Republicans (mostly against it) and Democrats (mostly in support of it).

Meanwhile, as Congress flails in passing NIL legislation and as college administrators struggle with a backup plan, collective leaders march onward with the hopes of continuing their conversation over the next evolution of compensation.

“I love the discussion,” one sitting FBS athletic director told Yahoo Sports. “This is where the discussion has to go. Somebody has to lead it.”