Q&A on the NCAA: ‘The long-term worry is the evolving employment model’

What will college athletics and the NCAA look like in the future?

It’s the fundamental question confronting the industry. Few know more about the myriad issues facing college sports than Tom McMillen, the former U.S. Congressman, college basketball All-American at Maryland and Rhodes Scholar. He is CEO of LEAD1 Association, which advocates on policy issues facing the 130 FBS athletic departments. LEAD1 has created working groups on issues such as NIL, transfers, diversity, equity and inclusion and enforcement, and provides feedback to the NCAA on best practices for representative governance. LEAD1 also seeks to generate consensus opinion among FBS athletic directors on significant issues. 

Since last checking in with McMillen about seven months ago, a period of sweeping change has accelerated. There has been movement toward athletes earning university employee status; a shifting narrative in the NIL space as donor-led collectives have raised concerns among some stakeholders; and the unveiling of the general framework of a new NCAA constitution amid increasing questions over whether a disparate collection of more than 1,200 schools still belong under the same big tent.

During a wide-ranging interview earlier this week, McMillen dove into all of the top-of-mind questions with the same fervor he displayed in the epic 1974 ACC Tournament championship game against NC State. Is it inevitable that athletes will be deemed university employees? What’s to stop the arms race among collectives? And have potential legal challenges rendered the NCAA’s NIL enforcement arm toothless?

This is part 1 of the interview; part 2 will be posted Saturday. The interview has been lightly edited for clarity and context.

Q: To set the scene before we get into specifics, what is the most significant issue currently on the minds of athletic directors?

McMILLEN: The model is evolving so fast that I think the frustration is that no one wants to be left behind. This is like Keystone, Colorado, in 1870 with no police and no sheriffs in the town. Everybody’s just pushing, scratching, pulling their hair out. I hear this from ADs, “How do we keep up?” The innovation is just pushing, pushing, pushing, pushing the envelope every day.

That’s the immediate one. The larger issue is the coming employment storm and what do you do about that. That is not going to happen overnight, but it could happen in phases. So we’re spending a lot of time on that, trying to educate where that goes. It is pretty clear that without congressional intervention, there’s going to be an employment model around the corner. The question is, how and when — if Congress did not get involved—and [and] what would that look like?

It’s funny: When I took this job in late 2015, beginning of 2016, I said at the time, “There’s going to be a day when you really want to make sure that you know your Congressmen very well.” We encouraged (ADs) to get to know them, get to Washington, go up and visit with them. The word in politics is you want to get to know people before you need to know them. That’s kind of where we are now. You have a Congress that has so many issues on their plate, and this is way down on the totem pole. And we have a very divisive political environment. So if you’re looking to Congress for relief, it’s not necessarily the best place to do so. What that means is that, in all practical terms, this has to get very messy. … You have to have so many things that are so excessive that it will draw your national legislators to it. Now, that scenario could change. If Republicans control Congress next time around, they could come in with a very streamlined bill without all the other stuff. So the long-term worry is the evolving employment model. Short-term worry is the evolving college sports model, which is changing almost overnight.

Q: As an overarching issue, as soon as Betsy Mitchell, the Cal Tech athletic director, said this during the NCAA constitution convention, I was curious about your reaction. She put it in the most blunt, most succinct terms possible. There are more than 1,200 member schools, a wide spectrum of institutional missions, resources, athletic department budgets. Given all the disparities, she aptly asked, “Why are we still trying to stick together?” So, why are we still trying to stick together under one big proverbial tent?

McMILLEN: I know that our small (FBS) schools, [with] about $25 million [athletic department financial models], and our largest with about $200 million — even that disparity is very difficult to bridge. There is a lot of aspirational sentiments among our schools. You look at a school like James Madison, who is coming into the FBS next year. It’s an amazing school. They have built tremendous facilities. They are really on a roll. They want to be aspirational. That is hard to contain. But I do believe this [NCAA constitutional] transformation going forward, D-I has got to be bifurcated or it is too big. There’s too many disparate parts in it. So I kind of agree with her [Mitchell] on that point. The question is how big it is at the end of the day. Are you just going to take 30 or 40 that are the highest-revenue schools and let them go off and play in their own sandbox? I don’t necessarily think that is the case because they all have to play someone. 

The more you stratify for commercial purposes, the more you’re at risk of being treated exactly like a business. You are a business, so you’re going to be taxed; you’re not going to have a charitable status anymore, you’re not going to get student fees. By the way, your conference is no longer going to be a charitable entity. You want to go Full Monty business? They kind of hang on to this status because there’s a lot of benefits to it. And the more you go Full Monty commercial, the more you’re going to look and act just like a business and be treated like a business. … One of the problems cordoning off the richest of the rich is that they will go right into that category. And maybe that is OK. Some ADs want that, but I would not say the majority of our ADs want that, by any means.

The size of NCAA Division I ‘is probably not sustainable’

Q: Along those lines, do you envision four NCAA divisions, instead of three, in the future?

McMILLEN: That could very well happen, yes. I don’t see three. And I think D-II and D-III, they are happy to get those checks. The issues are all around D-I. And D-I, the size of it, is probably not sustainable.

Q: The storm, as you referenced, surrounding the potential for athletes earning status as employees of their universities, I recently asked Casey Schwab of Altius to characterize the feelings among athletic directors regarding this possibility. He chose his words carefully: “Pessimistic, reluctant acceptance.” There is increasing sentiment that, whichever mechanism ushers in this model, it is coming and will impact at least some subset of athletes and universities. How would you characterize the feeling among athletic directors?

McMILLEN: We did a poll about a year ago and it was very interesting. Over 100 ADs responded: Do you want a professional commercial model, [where] they are employees, collective bargaining, full NIL rights, of course you have to be Title IX compliant and you may have to share revenue with the basketball and football student-athletes. The second scenario was the Higher Ed model, which was lowering [coaches’] compensation, lowering buyouts, slowing the facility arms race, greater investment in Olympic, non-revenue sports, expanded health, safety and scholarship protectives, full NIL rights, Title IX, no collective bargaining employment rights.

I don’t think we can get [a high percentage] of our ADs to support anything. But they supported the higher ed model. That’s not to say all our ADs; some of our ADs are fully comfortable going down the employment route. [About 85 percent of the ADs who responded said they are highly concerned about college athletes being classified as employees, whether via legislative, administrative or judicial means, with possible corresponding benefits and protections such as the rights to organize, strike, overtime pay, minimum wage, health and safety protections, and more.]

So how would I characterize their feelings? I think they are hopeful that alternatives — palatable alternatives — emerge. Having said that, I’d also say if you ask our 130 ADs, “Do you have confidence, the way college sports is governed, to come up with that palatable alternative?” They would probably say no. Look, COVID was very difficult. Everyone was going in their own direction. Look at the College Football [Playoff] expansion. One of the problems college sports has is that it is so fragmented. Everyone has a voice and a say. It’s almost impossible for college sports, the enterprise, to come together on any big, big stuff. They criticize our federal government about that, but it is doubly true in college sports. … They are hopeful that another alternative will emerge. But I think they are doubtful that the college sports enterprise can create it. 

Q: Do you feel it is inevitable that, at some point in the coming years, the employment model will come to pass?

McMILLEN: Let’s put it this way: It is inevitable that, as [Notre Dame athletic director] Jack Swarbrick said, a court, a regulatory body, someone is going to categorize college athletes as employees. I think that is inevitable. The reaction to that, a lot of it will be the politics of the day. A lot of it will depend on higher ed and how people react to it. Let me say it a different way: Thirty years ago we had a hearing on the Hill. We had the first million-dollar football coach. It was 1991. I made a comment at the time, “If we don’t slow those million-dollar coaching salaries, we’re going to have a million-dollar player soon enough.” It has been 30 years, but we are pretty close to being there right now. So I think what is inevitable is we are heading down [to] a full commercialization of college sports. That means that labor and management will have basically the same rights. 

That doesn’t mean that the college athlete of tomorrow, in general, will be as well off as they are today. In some cases, many of them will be worse off. All the Olympic sports, if you’re not a star, you may have a worse deal, even under collective bargaining. It is not guaranteed that the world is going to be rosier for everybody. The model we have right now is a model that many win, and the money really circulates to many. Where we are heading is a model where a few win; the money gets bigger, but there’ll be fewer winners in the model. Because I think basketball and football players are going to make a lot of money. The baseball player might not.

The employment model, if I had to predict, is racing down the road. I think only Congress can stop that, in a way. I am not sure college sports internally can do it; I think it is going to take a body like Congress to stop that.