The University of Hawaii is trying to secure better footing on a new competitive playing field for paying student athletes with taxpayer funding that partly drives winning or losing.
On July 1, U.S. collegiate athletics entered a new era when the settlement of a national class-action lawsuit allowed universities to pay players for the benefit of using their name, image and likeness—or NIL—after several years of such payments being restricted to deals from private donors, corporate sponsors and other third parties.
AdvertisementAdvertisementAdvertisementUH officials say that staying competitive in the NCAA’s Mountain West Conference of mid-major schools will take $5 million in annual public funding on top of private funding, and that the new landscape has already negatively affected recruiting.
During a recent legislative briefing, a couple of state lawmakers expressed concerns over using taxpayer funds to compensate athletes on teams at the state’s public university, while UH representatives said it was imperative.
“College athletics has changed, and we are trying to change with it, ” UH football head coach Timmy Chang told members of Senate and House committees on higher education during the Nov. 12 briefing.
UH has about 500 student athletes on 21 teams. Paying those players has been permitted by the NCAA as a way to compensate them for contributing to university revenue generated from sports.
AdvertisementAdvertisementAdvertisementFrom 2021 up until June 30, such NIL compensation had only been permitted by entities other than schools, and UH has tried to facilitate such third-party payments but had no hand in deciding which athletes received money or how much.
Since July, UH has been able to use donations, corporate sponsorship proceeds and revenue from sports to make NIL payments, and such deals that help coaches recruit and retain players stand to grow with public funding.
To encourage NIL funding contributions from private sources for school use, UH in September established a Boost the’Bows Fund online where donors can direct funding for individual sports.
UH officials also plan to begin a publicity campaign Monday that includes new information at and on social media to create better public awareness and understanding of the new NIL landscape that also encourages contributions.
AdvertisementAdvertisementAdvertisementRoster financing “What we want and what we are investing in, ” UH Athletic Director Matt Elliott told the legislative panel, “is a concept and a program that brings control back into the institution so that our coaches can make decisions about how to build the best roster … and give our student athletes the funding that they need to just live their lives, pay their rents, be able to afford the food that they need to be successful, and maybe put a little bit of money away that they could set up themselves for graduate school or maybe a down payment on their first apartment.”
Laura Beeman, head coach of the UH women’s basketball team, said the new NIL funding dynamic is already affecting recruitment, with players choosing other mid-major schools.
“We are going into our second and third recruiting cycles, and we’ve already lost six to 10 kids because we do not have the funding available currently to retain the type of kids that we need, ” she said during the briefing.
Chang told the panel that just a day earlier someone informed him that the current NIL market value of one player on the team, whom the coach didn’t identify, was $300, 000.
AdvertisementAdvertisementAdvertisement“The guy does not want to leave, ” Chang said. “He wants to be here. He wants to be part of this culture. Loves the guys he’s playing next to. But that’s just the world we kind of live in right now through NIL.”
House v. NCAA Under the settlement in the antitrust case known as House v. NCAA, schools can use public funding for NIL deals amounting up to 22 % of certain athletic revenue streams that include ticket sales, media rights and corporate sponsorships. The limit also rises 4 % in each of the next two years.
Another result of the settlement replaced scholarship limits with roster limits and ended third-party NIL payments that had no disclosure requirements.
For UH, the current revenue-sharing limit amounts to around $5 million, according to Elliott. For schools with the biggest sports programs, the limit this year is $20.5 million.
AdvertisementAdvertisementAdvertisementNo limit exists for NIL payments made by schools using sports revenue, corporate sponsorship proceeds and private contributions, which UH has already been using to pay student athletes.
In an interview Wednesday, Elliott said UH since July has made NIL deals totaling roughly $1.8 million, with about 70 student athletes in six to eight sports supported by private contributions received or expected.
Raising $2.5 million a year from donors, he added, would be an aspirational goal.
But without public funding, UH would be at a disadvantage against peer athletic programs, according to Elliott, Chang and Beeman, all three of whom were college athletes.
AdvertisementAdvertisementAdvertisement“We just need enough funding to be competitive within our conference, ” Beeman said at the legislative briefing.
Division on pay Sen. Kurt Fevela (R, Ewa Beach-Ocean Pointe -Iroquois Point ) bluntly objected to paying college athletes, especially using taxpayer revenue.
“This is college, not professional, ” he said during the briefing. “I get a problem with paying anybody coming to our school because our coaches or our school is not good enough for them to come.”
Rep. Andrew Garrett, chair of the House Higher Education Committee, said in response that the issue facing UH is how to remain competitive and possibly avoid what he called a “death spiral ” of fans losing interest if teams can’t compete, which could lead to UH moving to a lower division or possibly having athletics disbanded.
AdvertisementAdvertisementAdvertisement“We live in a different competitive landscape, ” said Garrett (D, Manoa ). “And I think that we have to decide, as a community, do we want UH to remain competitive or not ? If the answer is yes, then I think we’re going to have to step up as a state to give this university the resources that they need.”
Rep. Jeanne Kapela (D, Volcano-Hawaiian Ocean View ) expressed concern about UH coaches using taxpayer funding to buy players from outside the state at the expense of local kids wanting to play for UH, and wondered if public funding could be restricted for local athletes.
Beeman said teams already have a mix of local students and transplants, and that public funding would help keep some of the best local talent at home.
“It’s a double-edged sword, ” Beeman said. “(Local ) kids are leaving here because we can’t pay them.”
AdvertisementAdvertisementAdvertisementChang said about half the players on the football team are local, and that private NIL payments are helping players from Hawaii and from other places.
None of the UH officials offered an opinion on whether it would be legal to restrict public NIL payments to Hawaii residents.
Elliott declined to share how a $5 million appropriation would be divided between sports other than indicating that football, the largest revenue source for UH athletics, would receive $2.5 million.
That irked Kapela and Sen. Donna Mercado Kim, chair of the Senate Higher Education Committee.
“Any dollars we give you is public money, so any dollars we give you, you should be able to tell the public how it’s going to be used, ” said Kim (D, Kalihi-Fort Shafter-Red Hill ).
AdvertisementAdvertisementAdvertisementElliott explained that UH’s envisioned breakdown is partly based on the advice of legal counsel that he said is privileged but perhaps could be shared in some other forum.
Unlike athletic program spending that is subject to Title IX equity between women’s and men’s teams, public NIL funding represents a share of team revenue generation. So some sports may receive little or no public NIL funding if granted by the Legislature.
Some of UH’s more overshadowed sports include cross country, sailing, water polo, and swimming and diving.
Beeman volunteered that her minimum internal UH request for public and private NIL funding for women’s basketball is $450, 000. She also said that if she cared more about building a roster with players to dominate UH competitors, instead of having athletes who want to play for the culture and place, then she would have sought $800, 000.
AdvertisementAdvertisementAdvertisementGetting by Chang mentioned two current football team members as examples of how public NIL funding can benefit recruitment and retention in relation to more limited private NIL funding.
One player, Zhen Sotelo, a starting offensive lineman from Waianae in his fourth year on the team, had an opportunity to receive “big NIL money ” by moving to a mainland school prior to this year’s season, according to Chang, who said Sotelo was able to arrange “minimal ” third-party NIL pay that helped him stay at UH.
The other player, Jamar Sekona, a starting defensive lineman from Los Angeles playing his senior year at UH after transferring from the University of Southern California, received some private NIL pay but still worked four nights a week from 10 p.m. to 2 a.m. to make ends meet and participated in daily 6 a.m. team workouts, Chang told the panel.
NIL payments by UH using funds from donors, corporate sponsors and revenue are not public information due to student privacy. However, publicly funded NIL payments would be public, Elliott said.
AdvertisementAdvertisementAdvertisementElliott did tell the panel that not much public information is available on how much NIL money is flowing to schools and players across the country in part due to competitive reasons. He also said UH is basically seeking close to the maximum allowed for public NIL funding that other schools are expected to be seeking or have already received.
“This year we have no (public ) money, ” he said. “It’s just what we can generate on our own. … We’re trying to raise money to pay the students as the year is going on.”
AdvertisementAdvertisement