NCAA Scholarship Compliance: Financial Freedom or Financial Constraint?

Morgan Slade
Associate Editor
Loyola University Chicago School of Law, JD 2017

 

The National Collegiate Athletic Association (NCAA) has consistently monitored, regulated and investigated scholarship money given to college football players through eligibility regulations. While these scholarships are meant to be a form of financial freedom to players, abiding by NCAA compliance rules imposes an unreasonable burden on players and creates the potential for expensive repercussions.

There has increasingly been a question of whether college football players are being adequately compensated for their contribution. While these athletes are helping to generate billions of dollars for their college athletic departments, the NCAA deems these burdensome scholarships as sufficient “payment” for the players.

Is the NCAA scholarship enough?

Due to NCAA restrictions on amateurism and eligibility, these players are being “paid” well below their potential fair market value. If these players were allowed access to the same market as the professionals, the average football player would be worth $121,048, while these scholarship grants are situating the majority of them at or below the poverty level. Players are instead living in a culture where they contribute to the creation of a multi-billion dollar industry while being forced to constrain to regulations and limitations that are unjust.

The difference between what a “full ride” scholarship covers and the cost of attendance averages approximately $15,000. Not only are the athletes not paid nearly enough to satisfy what would be a general definition of a “full ride” scholarship, the money they do receive is riddled with numerous obligations and restrictions.

Compliance and Enforcement of Penalties

A mere days before Charleston Southern University was scheduled to play Florida State University on September 10, 2016, upwards of 30 players were suspended from the upcoming game. Multiple players took to social media to express their grievances that the suspension was due to the “misuse” of NCAA scholarship money. The NCAA suspended the players for using money designated as textbook money for other items purchased within the school bookstore.

When the players had leftover scholarship money after their textbooks were purchased, they were told by bookstore employees to use the remainder within the bookstore because they would not be receiving the unused money back. Despite the use of the money within the bookstore, which included the purchase of pencils and other school supplies, the suspension was handed down and the NCAA attributed this to a lack of regulation within the school’s administration. The NCAA’s response to backlash is that a specific amount is designated for textbooks and it is up to the school administration to hand out the individual amount needed. With blame being tossed between the school and the NCAA, the resulting penalty falls onto the players. Coaches can secure contracts for $24 million but a player who accepts an unapproved, free meal from a coach or uses his tuition money for the wrong type of item is automatically in violation of NCAA rules.

Effective Compliance?

The NCAA provides schools and players with these strict regulations to comply with but the rules lack the implementation and oversight to ensure they are carried out properly. NCAA abiding schools need to implement an organized regulatory compliance program like those laid out in the Seven Elements of an Effective Compliance Program, which is widely used as a reference point for companies to measure its current compliance program against. Due to the fact that the NCAA puts the rules in place but then leaves it to the colleges to supervise the scholarship distribution, the schools themselves should conduct internal monitoring and auditing of their programs. While monitoring the school may be a burden on the school itself, it would relieve the penalties that the players unjustly receive.

The NCAA and member schools would also benefit from developing effective lines of communication. Open lines of communication would allow schools easier access if questions or clarification are needed on a regulation before a player has to suffer a resulting suspension. This communication would also allow the NCAA to keep a closer watch on the schools in an attempt to prevent issues from arising which leads to player frustration and disappointment. The member schools could greatly benefit from having a compliance officer who specializes in NCAA compliance.

Putting in place an organized and effective plan to mitigate the damages of non-compliance would benefit the schools, the NCAA, and, most importantly, the players. Athletes who contribute to the school and the NCAA should not bear the burden of a chaotic implementation of rules and regulations. Instead, a capable compliance program and/or officer can implement policies and procedures to best handle NCAA regulations in ways that keep the players in compliance and on the field.

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