Seminoles brace for bump of $25 million in annual expenses with proposed NCAA settlement

As college athletics departments around the country wait for final approval of the House v. NCAA antitrust settlement, Florida State officials already are already grappling with a massive increase in expenses that could go into effect next year.

In a presentation to the FSU Board of Trustees on Friday, athletics director Michael Alford said the Seminoles could end up spending an additional $25 million next year in payments to athletes and additional scholarship costs as a result of the settlement. And the numbers will rise from there.

“We’re looking at a lot of different financial implications,” Alford said. “And really waiting for the House settlement to be settled before we can make a final decision.”

If the House settlement is approved by U.S. District Judge Claudia Wilken, schools will be able to directly provide athletes with $20-$23 million each year in payments for their name, image and likeness. That money will come from a portion of the schools’ television media rights.

The agreement also would call for new limits on roster sizes for many sports.

Schools won’t be required to fully fund those increased rosters or to pay the full amount of those NIL payments, but many elite college athletics programs are expected to do so to remain competitive.

“You can choose as a school … how you want to compete, at an elite level or not,” Alford said.

Florida State almost certainly will look to max out what it can pay athletes in terms of revenue-sharing, because that will be necessary to attract the nation’s best prospects, particularly in revenue sports such as football and men’s basketball.

One of the big questions facing the Seminoles will be whether they want to provide the maximum number of scholarships allowed under the settlement. In the past, football programs could only offer 85 scholarships each year; the proposed new limit would be 105. Baseball teams can only offer 11.7 total scholarships today, but that number could surge to 34.

Beach volleyball could go from 6 to 19, women’s soccer could rise from 14 to 28, softball could rise from 12 to 25, and similar increases would go into effect in sports across the board.

Florida State currently spends about $9 million each year in scholarship expenses, but Alford said that number could rise by over 50 percent under the proposed guidelines.

“If we were to fund every sport at the highest level we could fund it, it would be an additional $5 million in scholarship money,” Alford said.

He added that the ACC and other conferences are looking at whether they want to cap any roster sizes beneath the proposed new limits.

“You can have caps within a conference,” the Florida State athletics director said. “You just can’t collude with other conferences about what their caps are going to be.”

Alford said he and his staff are running “several scenarios” and monitoring what other universities around the country are discussing.

Some schools, he said, are considering offering the maximum number of scholarships in some sports and keeping other roster sizes the same. Some also are looking at the possibility of removing scholarships from some sports and changing them to “club” programs.

During Friday’s conversation, Florida State Board of Trustees members and BOT Chair Peter Collins noted that schools in some conferences, such as the SEC and Big Ten, will have an easier time absorbing the greater expenses because they have larger television contracts than those of the ACC and Big 12.

Florida State’s most recent athletics budget numbers available publicly, for Fiscal Year 2023, showed that the Seminoles spent $172 million on athletics that year.

Because Florida law prohibits public universities from spending money on athletics, Collins noted that the FSU athletics department can only use funds that it generates through media rights, ticket sales and other revenues, along with private donations.

Florida State and other schools have considered taking investments from private equity groups to handle those increased expenses, and while that hasn’t happened yet, Collins said it’s only a matter of time.

“They just can’t build the model, because the variables keep changing,” Collins said. “But it’s going to happen. It’s going to look nothing like it looks today even in three years.”

Lawsuit Update

FSU President Richard McCullough also provided a very brief update to the Trustees on the school’s ongoing lawsuits with the ACC.

“We underwent court-ordered mediation with the ACC, and we continue to have an open dialogue with the ACC, and all of that is good,” he said.

The school is suing to leave the conference in hopes of joining a conference that produces larger annual revenues.

Talk about this story with other die-hard Florida State football fans on the Tribal Council.