It’s been quite a year for the Indianapolis-based NCAA.
For starters, the pandemic forced it in March to cancel March Madness, the cash cow whose media rights account for the bulk of the organization’s billion-dollar budget.
It partly offset that body blow with a $270 million insurance payout. But that is hardly the only threat these days whipsawing the organization, which has been a potent cog in the city’s sports economic development engine since relocating here from Overland Park, Kansas, in 1999.
The NCAA, which governs college sports and stages its championships, has been controversial for years, with critics arguing that its real commitment is to the almighty dollar, rather than student-athletes.
Wherever you come down on that issue, the fact is public support now tilts toward greater rights for top athletes to profit from their stardom—a reality we implore the NCAA to navigate deftly and embrace in order to retain its relevance and protect its economic firepower.
There is no turning back: The strict definition of amateurism that has guided the organization since its founding is falling by the wayside.
That reality creates daunting cultural and governance challenges. Changing the thinking inside the NCAA requires a shift in thinking across college sports, given the organization has more than 1,200 members and is governed by a 25-member board of governors made up mostly of representatives of those schools.
As IBJ has reported, Congress and state legislators across the country are scrambling to pass bills that allow athletes to profit from their names, images and likenesses. Against that backdrop, the NCAA this month moved forward with a proposal that would open the doors for college athletes to pursue money-making opportunities.
It was an unequivocal acknowledgement that the landscape has shifted, no small concession for an organization that has spent decades opposing compensating athletes with anything other than athletic scholarships.
But critics say it really had no choice, given that five states have passed legislation addressing athlete endorsements, and more than two dozen others are considering bills, many giving athletes broader money-making powers than the NCAA would permit.
The Hoosier economy has a lot riding on how the organization adapts. The NCAA, headquartered in White River State Park, had more than 500 employees, with 112 earning more than $100,000 annually, according to a 2018 IRS filing, the latest year available. It showed that its 16 highest-paid executives collectively earned $11.6 million.
But the biggest economic impact comes from its pattern of staging championships in its home state. Since moving to Indianapolis, the NCAA has held Final Fours here every five or six years, including the one planned for next April. Just this month, when the NCAA announced site selections for more than 450 events from 2023 to 2026, it doled out 22 to Indiana municipalities.
It’s not easy for old-line organizations to change, a reality many businesses grapple with every day. And change is especially hard for an organization such as the NCAA, with its far-flung membership base with diverse agendas. Division I alone includes schools with athletic budgets as small as $4 million to as large as $200 million.
Yet change it must. We’re rooting for the NCAA to do so in ways that treat athletes fairly while continuing to bolster the city’s and state’s sports economies.•
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