Texas A&M, 12th Man Foundation mum on bold, announced NIL fund

Months after the 12th Man Foundation, the independent 501(c)(3) nonprofit fundraising organization that supports Texas A&M, announced a bold NIL compensation model, the foundation, the university and its football coach Jimbo Fisher have declined, or are unable, to provide updates on the aggressive plan.

The 12th Man Foundation unveiled the 12th Man+ Fund on Feb. 15. It’s an NIL compensation model that would most closely resemble an in-house collective, relative to the NIL landscape nationally.

Months after the 12th Man Foundation’s announcement, the 12th Man+ Fund has yet to publicly announce any NIL deals.

Texas House Bill 2804 took effect July 1, providing a friendly amendment to the Texas state law, but recent memos from the Internal Revenue Service and NCAA raise questions about the announced model, even if it’s now legally protected.

What’s the latest on the 12th Man+ Fund?

“I don’t know,” Fisher said Monday at SEC media days when On3 asked about its status. “That was not in my repertoire. That’s for the athletic director, the lawyers and everybody else to sort through and do what they got to do. I mean, that was what they did or come up with and whatever that is we’ll navigate and work on based off the right laws in which we have.

“So, I don’t know that answer. I’m just navigating by the rules they give me. I ask compliance every day and we go from there.”

On July 6, an employee of the 12th Man Foundation declined an interview request, as well as a follow-up question about answer whether the 12th Man+ Fund has entered into any NIL agreements yet.

Texas A&M athletic director Ross Bjork hasn’t responded to a voicemail or text messages requesting comment after the NCAA released the latest enforcement memo.

‘NCAA continues to move the goal posts around NIL’

On June 27, minutes before news broke that the NCAA released yet another memo in an attempt to regulate NIL activities, Bjork told On3 the 12th Man Foundation had indicated it planned on moving forward with the 12th Man+ Fund. Yet, current updates are unavailable.

“The Association has been clear and maintains that schools must adhere to NCAA legislation (or policy) when it conflicts with permissive state laws,” stated the memo from NCAA Executive Vice President of Regulatory Affairs Stan Wilcox.

While A&M hasn’t commented publicly about the future of the collective, public records indicate there have been discussions internally.

“NCAA continues to move the goal posts around NIL………,” Bjork wrote the following day in an email regarding the NCAA’s memo to Texas A&M President M. Katherine Banks, which On3 obtained through a public records request.

12th Man+ Fund said it would offer priority points

One clause in Texas’s newly adopted NIL legislation says a tax-exempt charitable organization can enter into NIL deals with athletes.

Bjork said in the interview in June “that came through another university, not from Texas A&M.” While he said Texas A&M supported it, however, he declined to name the institution.

The 12th Man Foundation said donors to the 12th Man+ Fund will receive priority points, which could further incentive donors to fund NIL deals. The Foundation announced donors who provide NIL contributions will receive four priority points per $100 annual fund donation, as well as priority points for consecutive years of giving.

“The Foundation is organized exclusively for charitable purposes and for the primary purpose of financially supporting the University’s athletic programs,” states a copy of the 2016 affiliate agreement between Texas A&M and the 12th Man Foundation obtained by On3 through a public records request.

As of July 1, Texas’s state law says the activity of a third-party entity that compensates athletes for the use of their NIL rights “may not be construed as an act on behalf of an institution” provided the entity is legally separate and the institution doesn’t own or control the entity.

The law states that “recognition by an institution…including the institution’s provision of priority status or other items of de minimis value equivalent to status or items the institution provides to the institution’s donors” do not constitute compensation provided by an institution.

Texas A&M, 12th Man Foundation have long relationship

Texas A&M and the 12th Man Foundation have entered into or amended various agreements in 1998, 2002, 2003, 2005, 2006, 2014 and 2016 regarding a variety of athletics-related topics, such as an expansion of a ticket program at Kyle Field and the funding of an athletics complex.

The 12th Man Foundation has participated in a program where it oversees tickets to events at Kyle Field for fundraising purposes and it then provides some of the net proceeds to Texas A&M.

The 12th Man Foundation reported $55.9 million in revenue compared to $89.5 million in expenses on its most recent tax return that’s available for the 2019 tax period, which ended June 30, 2020. It ended the period with more than $162 million in net assets or fund balances.

The 12th Man Foundation’s February announcement was bold. Prior to the release of the NCAA’s latest memo, Bjork told On3 multiple times that he heard anecdotally that numerous schools – as many as a dozen – explored a potentially similar model. However, the parties involved and the beneficiaries of the proposed 12th Man+ Fund aren’t speaking publicly, while a potential decision to move forward could draw scrutiny from the NCAA and even the IRS, depending on the specific NIL activities.