Jeremy Laura: The NCAA is paying players after 2.8B lawsuit. Will this affect the NHL?

Something needs to give. For one, the entirety of the scholarships should be treated as income to the athletes. They've never had to claim the value of the academic portion of the scholarships as income in the past, but now that they are professionals and not bound to any conditions to receive the scholarships, they should be treated as income.

Second, I think there should be contracts. There is no reason for colleges to recruit high school athletes unless they are blue chip recruits. Let them go to smaller schools, see if they are any good, and recruit them through the transfer portal. The problem is, there are costs associated with recruiting players and if they can pick a new team every year, it really does mean the smaller schools are going to have to serve as a development league. Look at Michigan football pre-JJ. Patterson did a fantastic job. Won them a Big Ten, finally beat OSU and then he was benched. Why? Because if Harbaugh doesn't play JJ, he walks. It means you really can't have your starters while you develop underclassmen, if they aren't starting, they are leaving. If the players are professionals, they should sign contracts and create some stability.

Finally, can we stop calling them student athletes at major universities? For the major sports, they don't even attend classes, it's all online now. There is no campus life for them. They are working out, practicing, watching film, eating or sleeping, and that's pretty much it. For the athletes that put all of their eggs in the going to the pros basket, let them. It serves no purpose for them to take useless classes created specifically for the athletes. Let the universities serve as the minor leagues, the players who want an education, let them, for those who could care less, let them be the pros they are. These degree programs created for athletes aren't going to prepare them for a life outside of the pros anyway, so why waste their time?

Unfortunately for the students at the big schools, it won't be long before there will be no student sections, because the students won't be able to afford them. The schools will need the revenue and selling season tickets to student for $150 is just not going to be possible in the new era. They've got the facilities, the players aren't student athletes, so just keep the major sports as minor league teams and be done with it.

Something needs to give. For one, the entirety of the scholarships should be treated as income to the athletes. They've never had to claim the value of the academic portion of the scholarships as income in the past, but now that they are professionals and not bound to any conditions to receive the scholarships, they should be treated as income.

Second, I think there should be contracts. There is no reason for colleges to recruit high school athletes unless they are blue chip recruits. Let them go to smaller schools, see if they are any good, and recruit them through the transfer portal. The problem is, there are costs associated with recruiting players and if they can pick a new team every year, it really does mean the smaller schools are going to have to serve as a development league. Look at Michigan football pre-JJ. Patterson did a fantastic job. Won them a Big Ten, finally beat OSU and then he was benched. Why? Because if Harbaugh doesn't play JJ, he walks. It means you really can't have your starters while you develop underclassmen, if they aren't starting, they are leaving. If the players are professionals, they should sign contracts and create some stability.

Finally, can we stop calling them student athletes at major universities? For the major sports, they don't even attend classes, it's all online now. There is no campus life for them. They are working out, practicing, watching film, eating or sleeping, and that's pretty much it. For the athletes that put all of their eggs in the going to the pros basket, let them. It serves no purpose for them to take useless classes created specifically for the athletes. Let the universities serve as the minor leagues, the players who want an education, let them, for those who could care less, let them be the pros they are. These degree programs created for athletes aren't going to prepare them for a life outside of the pros anyway, so why waste their time?

Unfortunately for the students at the big schools, it won't be long before there will be no student sections, because the students won't be able to afford them. The schools will need the revenue and selling season tickets to student for $150 is just not going to be possible in the new era. They've got the facilities, the players aren't student athletes, so just keep the major sports as minor league teams and be done with it.
- bluelineenforcer

I can’t argue with you. You see scouts watching 14 and 15 year old kids, walking that line by not recruiting a kid directly. U of M stadium has grown at least 3 or 4 times in my lifetime. There’s pretty much no sidewalk. You park and shuttle and local residents charge to park on their lawns. It’s a draw like nothing I’ve seen. The big problem they’ll have is how the “pie” is cut. If football brings in 50-60% of revenue (likely more) then how do you compensate the other programs without a nightmare of a battle? This is a problem of their own making (opinion) and it was eventually going to bite them.

Something needs to give. For one, the entirety of the scholarships should be treated as income to the athletes. They've never had to claim the value of the academic portion of the scholarships as income in the past, but now that they are professionals and not bound to any conditions to receive the scholarships, they should be treated as income.

Second, I think there should be contracts. There is no reason for colleges to recruit high school athletes unless they are blue chip recruits. Let them go to smaller schools, see if they are any good, and recruit them through the transfer portal. The problem is, there are costs associated with recruiting players and if they can pick a new team every year, it really does mean the smaller schools are going to have to serve as a development league. Look at Michigan football pre-JJ. Patterson did a fantastic job. Won them a Big Ten, finally beat OSU and then he was benched. Why? Because if Harbaugh doesn't play JJ, he walks. It means you really can't have your starters while you develop underclassmen, if they aren't starting, they are leaving. If the players are professionals, they should sign contracts and create some stability.

Finally, can we stop calling them student athletes at major universities? For the major sports, they don't even attend classes, it's all online now. There is no campus life for them. They are working out, practicing, watching film, eating or sleeping, and that's pretty much it. For the athletes that put all of their eggs in the going to the pros basket, let them. It serves no purpose for them to take useless classes created specifically for the athletes. Let the universities serve as the minor leagues, the players who want an education, let them, for those who could care less, let them be the pros they are. These degree programs created for athletes aren't going to prepare them for a life outside of the pros anyway, so why waste their time?

Unfortunately for the students at the big schools, it won't be long before there will be no student sections, because the students won't be able to afford them. The schools will need the revenue and selling season tickets to student for $150 is just not going to be possible in the new era. They've got the facilities, the players aren't student athletes, so just keep the major sports as minor league teams and be done with it.
- bluelineenforcer

Scholarships are not and were never income.

Scholarships are not and were never income.

- blacksheep1

I disagree to a point. If there’s a clear abuse where the academics are being compromised to bring in an athlete that’s very real money spent. If the athletes are doing the work that goes with the enrollment no problem at all. Just as I don’t argue over academic scholarships. Some schools revoke if grades are a problem, others don’t. If a school is paying and giving a scholarship to someone who isn’t doing the academic work, that feels like compensation on multiple levels

Something needs to give. For one, the entirety of the scholarships should be treated as income to the athletes. They've never had to claim the value of the academic portion of the scholarships as income in the past, but now that they are professionals and not bound to any conditions to receive the scholarships, they should be treated as income.

Second, I think there should be contracts. There is no reason for colleges to recruit high school athletes unless they are blue chip recruits. Let them go to smaller schools, see if they are any good, and recruit them through the transfer portal. The problem is, there are costs associated with recruiting players and if they can pick a new team every year, it really does mean the smaller schools are going to have to serve as a development league. Look at Michigan football pre-JJ. Patterson did a fantastic job. Won them a Big Ten, finally beat OSU and then he was benched. Why? Because if Harbaugh doesn't play JJ, he walks. It means you really can't have your starters while you develop underclassmen, if they aren't starting, they are leaving. If the players are professionals, they should sign contracts and create some stability.

Finally, can we stop calling them student athletes at major universities? For the major sports, they don't even attend classes, it's all online now. There is no campus life for them. They are working out, practicing, watching film, eating or sleeping, and that's pretty much it. For the athletes that put all of their eggs in the going to the pros basket, let them. It serves no purpose for them to take useless classes created specifically for the athletes. Let the universities serve as the minor leagues, the players who want an education, let them, for those who could care less, let them be the pros they are. These degree programs created for athletes aren't going to prepare them for a life outside of the pros anyway, so why waste their time?

Unfortunately for the students at the big schools, it won't be long before there will be no student sections, because the students won't be able to afford them. The schools will need the revenue and selling season tickets to student for $150 is just not going to be possible in the new era. They've got the facilities, the players aren't student athletes, so just keep the major sports as minor league teams and be done with it.
- bluelineenforcer

Is all this in reference to revenue producing sports like football and basketball, or all college sports?

I disagree to a point. If there’s a clear abuse where the academics are being compromised to bring in an athlete that’s very real money spent. If the athletes are doing the work that goes with the enrollment no problem at all. Just as I don’t argue over academic scholarships. Some schools revoke if grades are a problem, others don’t. If a school is paying and giving a scholarship to someone who isn’t doing the academic work, that feels like compensation on multiple levels
- Jeremy Laura

How would this be policed? If a wrestler gets below a 2.0, his scholarship is declared income? That's tough, especially where a lot goes into what contributed to a low GPA.

How would this be policed? If a wrestler gets below a 2.0, his scholarship is declared income? That's tough, especially where a lot goes into what contributed to a low GPA.
- Only_A_Ladd

No, scholarships are supposed to be revoked at low GPA. Universities, especially state universities, have audit processes for scholarships. So it is very easy to track that. The other issue brought up is players who just don’t go to class but end up with passing grades. None of this is new. If someone isn’t in class it can be instantly reported to the coach and the dean. Cars as gifts, etc. but now if the players are salaried on top of scholarships you’re opening a whole different can of worms.

Is all this in reference to revenue producing sports like football and basketball, or all college sports?
- Only_A_Ladd

All sports. This is why it’s going to hit that wall. The NCAA can easily show what percentage of income relates to each sport and how many make no money or even lose money. However, how long do you think that will stand if those other sports report they’re not being paid but the “select group” of athletes are? I think the simple answer could be a really tough one. If football brings in enough athletic funds to hold up 3 other sports the University can just cancel those programs if it becomes an issue.

More interesting (and in relation to the NHL) the rule had been school or paycheck. If you can get paid in college, does that change? Can someone start the “pro route” and then change their mind in favor of going to college? There are no clean hands in this lawsuit. I just watched a former collegiate athlete talk about the car he was given to be on the football team. He was an amazing player, but those side deals may get some more attention.

No, scholarships are supposed to be revoked at low GPA. Universities, especially state universities, have audit processes for scholarships. So it is very easy to track that. The other issue brought up is players who just don’t go to class but end up with passing grades. None of this is new. If someone isn’t in class it can be instantly reported to the coach and the dean. Cars as gifts, etc. but now if the players are salaried on top of scholarships you’re opening a whole different can of worms.
- Jeremy Laura

I mean policing at the state and federal level: if a player attends class and doesn't achieve a GPA, should that student have his or her scholarship not only pulled but then taxed or is there some sort of abuse that needs to take place such as class absences? I think the existing rules make scholarships non-taxable if the student is working towards a degree (however that's interpreted by the regs).

I mean policing at the state and federal level: if a player attends class and doesn't achieve a GPA, should that student have his or her scholarship not only pulled but then taxed or is there some sort of abuse that needs to take place such as class absences? I think the existing rules make scholarships non-taxable if the student is working towards a degree (however that's interpreted by the regs).
- Only_A_Ladd

Not taxed, yes pulled. This is specifically about what was a fine line being erased. Players who got scholarships to schools, didn’t go to class but were given passing grades. The academic scholarships I had made it clear of the revocation if I wasn’t putting in the work. Students are also suspended from colleges for low gpa and that is at the State Level. What is going to happen now that money diverted from NCAA earnings for those scholarships is compounded with a salary? State Schools are taxpayer funded and that brings a level of scrutiny that can be brought. This isn’t a Federal jurisdiction. The other point you inadvertently make is that this may be a student who cannot meet the basic academic requirements but are a draw in terms of athletic ability.

Where this is a concern for the NHL is quite simply, this blurs the line between the different paths a prospect can take. I’ve seen scholarships lost, programs cancelled and students expelled. The NCAA just lost a grip on the gold mine. This will cascade into other issues.

I am of the opinion that colleges should be for education only - not for sports. Colleges should shed all inter-collegiate athletics and instead junior and minor leagues for all sports (where the players are paid) should form near the colleges, but independent of them. This would also give the athletes the opportunity to go to trade schools instead.

The vast majority of college football players have no business being in college, and many not in trade schools either for that matter. The average SEC football player has a second grade reading comprehension. My 7 year old niece who just got straight A's in second grade is already ahead of most of them.

I am of the opinion that colleges should be for education only - not for sports. Colleges should shed all inter-collegiate athletics and instead junior and minor leagues for all sports (where the players are paid) should form near the colleges, but independent of them. This would also give the athletes the opportunity to go to trade schools instead.

The vast majority of college football players have no business being in college, and many not in trade schools either for that matter. The average SEC football player has a second grade reading comprehension. My 7 year old niece who just got straight A's in second grade is already ahead of most of them.
- PghPens668771

This is an interesting take. A friend who specializes in NFL “stuff” said that the current football situation only exists because the NFL wants that setup. This is a very complicated issue that went from scholarships/gifts/jobs where the player could get a side income (without doing the job) to open payment. Does this make a case for a different league or setup? These student athletes will essentially be pro athletes. I am very curious as to how this affects the current rules for the NHL. This isn’t a development I thought I’d see

Scholarships are not and were never income.

- blacksheep1

I'm a CPA, the academic portion of the scholarships are not considered income, nor are costs directly related to education, such as books and supplies. Everything else is taxable income. University provided room and board is considered income as are meal plans. Technically, when they are given university swag including championship rings, it's taxable.

Do these young athletes calculate all of this and report it on their 1040s? Rarely. Does the IRS overlook it? Absolutely. Do the universities do a good job of making sure the athletes know they are getting taxable income? Absolutely not, but make no mistake, there are not a lot of transactions that happen in this country where the govt doesn't feel entitled to their "fair share". Just wait till we have all digital currency, they'll get their "fair share" then.

All sports. This is why it’s going to hit that wall. The NCAA can easily show what percentage of income relates to each sport and how many make no money or even lose money. However, how long do you think that will stand if those other sports report they’re not being paid but the “select group” of athletes are? I think the simple answer could be a really tough one. If football brings in enough athletic funds to hold up 3 other sports the University can just cancel those programs if it becomes an issue.

More interesting (and in relation to the NHL) the rule had been school or paycheck. If you can get paid in college, does that change? Can someone start the “pro route” and then change their mind in favor of going to college? There are no clean hands in this lawsuit. I just watched a former collegiate athlete talk about the car he was given to be on the football team. He was an amazing player, but those side deals may get some more attention.
- Jeremy Laura

Based on the fact that college athletics are no longer amateur, I think from a development standpoint, the NHL should revamp their ELCs. I believe, like the NFL & MLB, the teams should sign their drafted players to ELCs right out of the gate. They can give these young men $70k/yr or whatever it is now, and they become pros right after the draft. Those contracts aren't going to have major impacts on the finances of the teams. Like with the MLB, which has numerous levels of development leagues, they could treat the CHL & USHL similar to a rookie or "A" league. Perhaps college or ECHL is AA, and AHL is triple A. There would obviously be a similar system internationally. I think ultimately, they will produce more NHL caliber players. Currently, the window is very short. You have 3 years to prove you should be a pro, and usually another 3 years to prove you're NHL capable. With the above system, they could get these young players on a development lifecycle at 18, and like MLB, some players may not develop until they're in the mid to late 20s, but they haven't been given up on by the time they are 21 or 22.

I'm a CPA, the academic portion of the scholarships are not considered income, nor are costs directly related to education, such as books and supplies. Everything else is taxable income. University provided room and board is considered income as are meal plans. Technically, when they are given university swag including championship rings, it's taxable.

Do these young athletes calculate all of this and report it on their 1040s? Rarely. Does the IRS overlook it? Absolutely. Do the universities do a good job of making sure the athletes know they are getting taxable income? Absolutely not, but make no mistake, there are not a lot of transactions that happen in this country where the govt doesn't feel entitled to their "fair share". Just wait till we have all digital currency, they'll get their "fair share" then.
- bluelineenforcer

Thank you for that. My time as an R.A. Was considered taxable. I got room and board and the meal plan. If I had become an Assistant Director, there was a stipend added to that.

Based on the fact that college athletics are no longer amateur, I think from a development standpoint, the NHL should revamp their ELCs. I believe, like the NFL & MLB, the teams should sign their drafted players to ELCs right out of the gate. They can give these young men $70k/yr or whatever it is now, and they become pros right after the draft. Those contracts aren't going to have major impacts on the finances of the teams. Like with the MLB, which has numerous levels of development leagues, they could treat the CHL & USHL similar to a rookie or "A" league. Perhaps college or ECHL is AA, and AHL is triple A. There would obviously be a similar system internationally. I think ultimately, they will produce more NHL caliber players. Currently, the window is very short. You have 3 years to prove you should be a pro, and usually another 3 years to prove you're NHL capable. With the above system, they could get these young players on a development lifecycle at 18, and like MLB, some players may not develop until they're in the mid to late 20s, but they haven't been given up on by the time they are 21 or 22.
- bluelineenforcer

I think they’d have to change the contract count at that point. Capped at 50 right now if I’m not mistaken. The “loophole” of a player staying in school and not signing their ELC has been interesting (though not used a ton). Then they have to decide if it goes against the cap to have those deals or if a new category is created. This whole movement feels like it could have a sweeping effect beyond just the student athletes