Texas athletic director Steve Patterson said on Wednesday that the university will start paying athletes $10,000 per year under new NCAA rules. "The money will cover college expenses that aren't covered by a traditional full scholarship and give each player $5,000 in compensation for the university's use of his image," the Dallas Morning News reports.
That is really nothing new, and it's not a "payment" in the traditional sense of the word. However, $10,000 looks like a large number, and it caused a lot of people to assume that this will start a bidding war in college sports.
So Texas will play athletes $10,000/year. The bid is to you, Ohio State. Do I hear $15,000? #Badgers— Jeff Potrykus (@jaypo1961) October 22, 2014
This is not true. Per NCAA rules, Texas cannot pay athletes whatever it wants, and in fact, the university has very little say in how much it will compensate athletes if it wants to keep up with the rest of Division I.
Here's how that $10,000 breaks down:
- A payment of $5,000 per year to be put in a trust, in accordance with the O'Bannon ruling. The court ruled that the NCAA's current compensation cap of zero dollars is illegal, but it can legally cap trust fund money at $5,000 per year. That is the expected cap, and that is what every power-conference program is expected to be paying. That the richest athletic department in the country will pay the maximum amount allowed (along with every other major school) is not a surprise.
- The rest of the money comes from a "cost of attendance" stipend. Right now, scholarships are capped below the full cost of attending school. The NCAA will likely allow schools to offer cost of attendance scholarships very soon, and once again, Texas and its power-conference brethren were always going to offer this as soon as they could. Cost of attendance differs based on the cost of living, so "total compensation" might vary, but when you take cost of living into affect, no school is going to be offering more than anyone else. That includes Texas.
It's not even something they're doing yet, because they can't. The O'Bannon ruling is not in effect yet.
What this means is that Texas is going to be investing $10,000 more into each athlete. These are not discretionary payments, nor are they payments based on abilities or endorsements — all athletes must be paid the same, according to the rules. Moreover, Texas is not going to be paying athletes more than any team that it regularly competes against.
However, that doesn't fit Patterson's narrative, as he also said on Wednesday that he's basically paying athletes more than what most people in the country make.
Steve Patterson: Full ride football player at Texas gets benefits of $69,000 a year. Men’s hoops: $77,000/year.— Bryan Fischer (@BryanDFischer) October 22, 2014
More of Texas AD Steve Patterson from that forum: "You add taxes to that & you’re in the top 1/3 of household incomes in the United States."— Bryan Fischer (@BryanDFischer) October 22, 2014
The problem with this argument is that only $10,000 of that is actually paid to athletes, while the rest of it is just part of the school paying another part of the school. Moreover, half of the actual payment to athletes is part of a trust fund, while the other part (a few thousand dollars) is just a stipend for living expenses.