The Impact of Alston Payments for a School
Just over a year ago on July 1st, 2021, college athletes finally gained the ability to profit off their name, image, and likeness legally. Ever since there has been no shortage of coverage and discussion about the topic of NIL in addition to how certain schools are leveraging it to attract top recruits and transfers. However, just a few days earlier on June 21st, 2021, the Supreme Court ruled against the NCAA via a 9-0 vote in the NCAA v. Alston case.
Given that the case was decided days before NIL was enacted, many people falsely assumed that Alston was centered around the NCAA restricting college athletes from making money from endorsement deals, jersey sales, or appearances. But the case had nothing to do with NIL. Previously, the NCAA had established rules to limit the type of compensation and benefits that the school could give to their athletes.
The Alston ruling brought an end to the NCAA’s ability to do that and schools were given the autonomy to provide unlimited education-related benefits beyond tuition. You might be asking: what are some of those benefits? While there are many things that can fall into this category, some of the most common are grants-in-aid for tuition, fees, room, board, books, computers, internships, and other expenses up to the value of the full cost of attendance. Most notably, however, schools now have the power to offer direct financial awards in the form of academic achievement awards of up to $5,980 per year.
While all of these things will greatly benefit athletes in their experience on campus, the last item on that list is the one that obviously generates the most attention. We constantly hear how NIL payments aren’t supposed to come directly from the school, be used as recruiting inducements, or be used as pay-for-play performance incentives. Whether those rules are actually being followed across the nation is a whole other topic. However, Alston's payments are different. They can be paid out by the school and can be based on performance, academic performance that is.
Now, while every school has the ability to disperse $5,980 per year to all of their athletes, that doesn’t mean that all of them have the capacity to do that. As conference realignment has resurfaced this summer, we’re constantly reminded of the growing financial gap between the most powerful conferences and everyone else. Quite frankly, there aren’t many schools in the country that can afford to offer Alston payments to all of their athletes. According to an ESPN article this past April, only 22 schools had announced they had plans in place to offer Alston awards. In the future, more are expected to join that list, but it will be far from a universal offering even among FBS schools.
$5,980 per year is not life-changing money and by itself probably shouldn’t be the sole factor why a recruit should or shouldn’t choose his or her school. However, it’s hard to imagine that not being a factor in the decision-making process. A recent On3 article highlighted how football recruits still view factors like the coaching staff, proximity to home, and playing time more heavily than NIL. But 57% of recruits surveyed in the pieces still listed NIL payments among the top five items in their criteria. If a coaching staff in any sport can sell to a recruit that he or she has the ability to make approximately an additional $25,000 if they perform well in the classroom, that’s a big plus.
For high-profile blue-chip football and basketball recruits, this is probably less relevant. The money reportedly offered to the elite prospects dwarfs the maximum Alston payment a school can offer. However, I can see this being a factor in many of the other sports on campuses across the country and at the mid-major level where NIL isn’t as prevalent. If one particular Sun Belt school, for example, is able to offer Alston awards to their athletes while their peers are not, that school can position itself to have an immediate talent advantage.
Additionally, the way schools structure their Alston payments is important and is by no means universal across the board. Wisconsin recently announced in their plan that athletes will receive only $980 per year until their athletic eligibility has expired and, upon graduation from Wisconsin, will receive an additional $5,000 for each year up to $25,000. Simply, that means that if a Badger athlete wants his or her full Alston payment, they cannot transfer and must graduate. Other schools pay the full $5,980 upfront each year.
How schools handle Alston payments moving forward will be interesting to follow. As we know, the landscape of college sports is evolving each day and how things are in five years is extremely unpredictable. Kevin Warren said that the “business of college sports is growing faster than the governance of college sports” at Big Ten Media Days this past week and it couldn’t be closer to the truth. Who knows, athletes could become employees of their respective schools and might make NIL and Alston payments less significant. But for now, every school that can offer the $5,980 per year has an undoubted recruiting edge.
Brendan can be found on Twitter @_bbell5