NIL / Rev Share Clarification Needed

Dec 2, 2024, 7:58 AM

Sorry for long post, this is directly from the IPTAY website. Just want clarification if anyone has some.

“Universities would be permitted to directly share revenues with student-athletes in addition to the benefits that already accompany scholarships: tuition, housing, meals, academic awards, health care, etc. The settlement sets a uniform revenue share cap for all A5 schools equal to 22% of the average media, ticket, and sponsorship revenue. For 2025-26 the revenue share cap for each school is approximately $20.5M and will be periodically recalculated. Each individual school can decide how to distribute the revenue share amongst its sports teams and student-athletes. There is no minimum required distribution. The revenue share is associated with the grant of certain NIL rights to the school and does not create an employment relationship between the school and its student-athletes.

The settlement also allows for third-party NIL payments to student-athletes. Those third-party payments must be fair market value payments for a legitimate business purpose and not used for pay-for-play (e.g., merely an inducement to enroll or remain at a particular institution.) Legitimate third-party NIL payments will not count towards the revenue share cap and will be reviewed by an independent clearing house to determine compliance with the fair market value rules. This will be a fundamental shift in the current NIL landscape where there is currently no legitimate purpose / fair market value requirement. These rules are in the process of being written.”

Does this not mean that a situation like Dave Portnoy and Barstool “luring” Bryce Underwood to Michigan over LSU becomes rule breaking? It certainly reads that way.

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I think it *should* read that way, but I have a feeling it's going to be hard to truly police it. It used to be fairly obvious which players were getting paid under the table (what they wear on road trips, cars, etc) but with them being able to collect large sums of money already, those can be covered with "legitimate" NIL money while they keep the Portnoy-style payments under the table. I just don't see how the teams that are already known to do so much under the table stuff will stop; it'll just be tougher to catch (not that the NCAA really has the stones to police things anymore as it is). Maybe I'm just jaded. Also...how do we determine "fair market value?" It turns into "Underwood does an advertisement for Barstool and gets paid X dollars." Who determines what X is? NCAA? Michigan? Big10? Portnoy? I have a lot of questions in that realm.