While possibly the biggest change ever in college sports, this is just the first step.
“I tell our coaches and our students, ‘The three most significant events in the history of college athletics are, first, the NCAA’s foundation [1905], second, the adoption of Title IX [1972] and all the opportunities that were created because of it, and third, the House settlement,’” University of Alabama athletic director Greg Byrne told ESPN.
The House Settlement Goes Into Effect
Friday (6/5), Judge Claudia Wilkens approved the deal between the NCAA, its most powerful conferences and lawyers representing all Division I athletes. The House v. NCAA settlement ends three separate federal antitrust lawsuits, all of which claimed the NCAA was illegally limiting the earning power of college athletes. The lawyers involved in the House v. NCAA settlement were awarded a total of $475.2 million in fees.
Biggest Changes:
- The NCAA will pay nearly $2.8 billion in back damages over the next 10 years to athletes who competed in college at any time from 2016 through present day.
- Moving forward, each school can pay its athletes up to a certain limit. The annual cap is expected to start at roughly $20.5 million per school in 2025-26 and increase every year during the decade-long deal. These new payments are in addition to scholarships and other benefits the athletes already receive.
- Athletes are also still allowed to make money from selling the rights to their name, image and likeness (NIL) to other parties. The settlement creates a new set of rules and a brand-new organization called the College Sports Commission that will try to stop boosters from using NIL deals as additional salary payments, a practice that became commonplace in the past several years.
- Schools will now have established roster limits, as opposed to scholarship limits. For example, football roster’s are now capped at 105, basketball at 15, baseball at 34, soccer at 28, softball at 25, and cross country at 17.
Key Settlement Dates:
- June 6, 2025: Settlement approved; settlement-related NCAA rules are effective, as adopted by the NCAA Division I Board on April 21, 2025
- June 11, 2025: NIL Go portal launches (the website for the clearinghouse for NIL deals)
- July 1, 2025: First date for direct institutional revenue sharing payments to student-athletes
- July 6, 2025: Opt-in schools must “designate” student-athletes permitted by the settlement to remain above roster limits (these are those student-athletes ‘grandfathered’ and exempt from losing their scholarships due to the new roster limits)
- Start of 2025-26 academic year: With the exception of the “designated” student-athletes, fall sports must be at or below roster limits by their first day of competition
Some of the inevitable lawsuits ahead that will keep the lawyers in new cars for a long time.
- The contracts that athletes are now signing with their schools will likely bolster ongoing legal arguments that at least some college players should be considered employees of their schools.
- The NCAA is fighting more than a dozen lawsuits that challenge rules about how long athletes are allowed to remain in college sports.
- Antitrust challenge – the negotiated salary cap (this season $20.5 million) will be challenged
- Antitrust challenge – College Sports Commission’s attempts to stifle deals between athletes and third parties will be challenged
- Schools will also likely have to defend their decision to provide most of the new payments to men’s sports teams against claims that budgets violate Title IX
The Future: Collective Bargaining is looming on the horizon
Now that the concept of paying athletes directly is a reality, look for attention to turn to collective bargaining/employment/unionization as the next big topic college sports has to grapple with. There are organizations including Athletes.org that have anticipated this moment and are ready to help push for collective bargaining to help solve many of the new issues that come with the House settlement’s approval.
References and further reading material:
https://www.espn.com/college-sports/story/_/id/45469494/ncaa-settlement-done-divide-spoils
https://www.espn.com/college-sports/story/_/id/45469454/after-house-settlement-approval-here-next