Why the NCAA House settlement could have a negative effect on Winthrop, mid-majors

Winthrop Athletic Director Chuck Rey is feeling less than optimistic about the NCAA’s House lawsuit settlement — not because current and former Division I athletes who played college sports between June 15, 2016 and Nov. 3, 2023 will be paid out a share of approximately $2.8 billion, nor because the NCAA appears to finally paying athletes their “fair share.”

Rey’s worry stems from something Winthrop University — and many other mid-major programs — will be losing when the settlement is implemented: money.

Friday night, after multiple delays, the long form agreement of the NCAA’s landmark settlement in the House, Hubbard & Carter antitrust cases was filed with the California District Court.

To foot the bill the settlement will trigger, the NCAA will incrementally siphon money from the revenue sharing to its 363 full Division I institutions over a 10-year period, beginning in the 2025-26 school year.

Big South commissioner Sherika Montgomery said that the amount expected to be forfeited differs by conference, and the Big South combined is expected to pay “millions” in total. Member schools are to expect around a 25- to 30-percent decrease in revenue share received during that time.

After taking out the legal fees, Montgomery said “about 94 to 96 percent” of the remaining damages paid will go to former or current Power Five student athletes.

“I don’t know if any of our (current or former) student-athletes will see that funding,” Rey said. “We’re in a day and age now where the NCAA is splitting up revenue, distributing revenue for these student-athletes, just as coaches have been paid and universities have made money. The court rulings have found that student-athletes should also be entitled to some of that. A majority of that money is going to go to those Power Five programs. It’s good for them, it’s challenging for us, but unfortunately, all mid-major schools were in that same boat.”

There are three types of damages to be paid out as part of the settlement: broadcast NIL (name, image and likeness), video game NIL and third-party NIL (what we typically understand NIL to be).

Those damages will be paid across three classes of plaintiffs: Power Five football and men’s basketball, Power Five women’s basketball and additional sports (specifically student-athletes who earned NIL money after July 1, 2021).

Montgomery understands how grim things are projected to be, but she’s explained to those around her that this is necessary to ensure the NCAA doesn’t find itself in a similar situation. Montgomery is optimistic about where the landscape of college athletics will go as she enters her second year as conference commissioner.

“Intercollegiate athletics will not look and/or operate as it did (in years past) as it will (in the future),” Montgomery said. “But I’m optimistic that the reason for that, albeit difficult at this point, is a positive. A lot of people are covering and seeing the challenges that we’re dealing with right now with the House settlement based on the large number of that $2.8 billion. But when you actually dig down, do the research and you just look at the litigation that we as an industry have dealt with in the last multiple decades, it’s more so wanting to position ourselves that we are able to move forward and not continue to have to have some of those challenges.”

Scholarship restriction changes?

The House settlement payouts may not be the only major change coming to college athletics in the fall of 2025.

In addition to the settlement, there are reported plans to eliminate collegiate by-sport scholarship restrictions, meaning that sports programs can offer scholarships to the entirety of their rosters.

This also comes with new roster limits across most sports. FBS football will have a roster limit of 105 (current scholarship limit is 85), while baseball will have a roster limit of 34 (previously 11.7).

The changes will also change the types of scholarships available.

Sports like football and basketball are known as “head-count sports”, meaning that players on scholarship have school fully paid for. However, the new changes will convert all sports in “equivalency sports”, meaning that any sport can offer partial scholarships to its players. Baseball is already an equivalency sport.

Schools don’t have to use all of these new scholarship slots, but Rey is pessimistic about how this will change the athletic landscape.

“It’s only going to increase the transfer portal too,” Rey said. “Now, very good athletes or athletes that are at mid-major schools like (Winthrop), there’s going to be more scholarship opportunities at Power Five schools. Because of that, we may lose some of our top student-athletes to scholarship opportunities at those schools. We’re not going to have the capability to scholarship all of our student-athletes.”

‘Strategic and intentional decisions’

The increased scholarship chances at larger schools with a decreased revenue share has Montgomery calling on Big South institutions to make “strategic and intentional decisions”.

“The level of competitiveness across the board when it comes to recruiting as well as retaining student-athletes, sport-by-sport, I do think that’s going to become increasingly difficult,” Montgomery said. “Which is why I feel like institutions and administrators as well as conferences are going to have to be very intentional and strategic as it relates to how we move forward, whether that’s institution to institution or having some type of conference-overall parameters and/or requirements when it comes to making sure we’re able to continue to be competitive with this shift and this change.”

Montgomery said that the conference is embarking on a new strategic plan to navigate the new landscape.

She called the new changes “a perfect storm” but said from a conference and institutional level there needs to be a focus on “new and innovative ways that we are able to recruit as well as attract new revenue streams”.

The terms to the settlement are to be reviewed by Judge Claudia Wilken, and a final ruling is expected for several months.