Author Archives: prions

Chapter 4: Compliance and Title IX

The NCAA regulations have grown over time and now include:

  • Institutional control
  • Student-athletes’ well-being
  • Gender equity
  • Good sporting behavior and ethical conduct
  • Sound academic standards
  • Nondiscrimination
  • Diversity in governance structure
  • Rules compliance
  • Amateurism
  • Competitive equality
  • Recruiting governance
  • Eligibility governance
  • Financial aid governance
  • Governance of playing and practice seasons
  • Governance of postseason competition
  • Governance of economic program operation

The NCAA has a different manual for each of its three divisions. Division I has the most complex governance, as one would expect. However, Title IX applies equally to all three divisions.

The NCAA text describes institutional responsibility as follows:

Each institution shall comply with all applicable rules and regulations of the Association in the conduct of its intercollegiate athletics programs. It shall monitor its programs to assure compliance and to identify and report to the Association instances in which compliance has not been achieved. In any such instance, the institution shall cooperate fully with the Association and shall take appropriate corrective actions. Members of an institution’s staff, student-athletes, and other individuals and groups representing the institution’s athletics interests shall comply with the applicable Associate rules, and the member institution shall be responsible for such compliance.

NCAA, 2013a, p4

The Compliance Office is an org within a university staffed with one or more Compliance Officers (the book doesn’t specifically say they’re a team but it’s unfathomable that Alabama Football doesn’t have a team).

Recruiting definitions:

  • Contact
    • Face-to-face meeting with student and/or parents
  • Contact Period
    • Time when in-person contact at campus, watching games, and phone/written conversations are permitted
  • Dead Period
    • No direct contact, written/phone still allowed
  • Evaluation
    • Watching student compete
  • Evaluation Period
    • Time when coach may evaluate, write/phone but not have contact
  • Official Visit
    • Any visit paid for by the college
    • College can pay for transportation, meals, and reasonable entertainment expenses
  • Prospective Student-Athlete
    • Starting in 9th grade, or
    • Earlier than 9th grade if you receive financial aid or benefit from the college
  • Quiet Period
    • No contact or evaluation, but may visit and have written/phone correspondence
  • Unofficial Visit
    • Not paid for by the college
  • Verbal Commitment
    • Not binding, unlike signed letter

Violations of NCAA regs:

  • Secondary Violations
    • Unintentional and minor infractions
    • Typically an isolated or inadvertent breach
    • Typically provides no competitive advantage
    • Usually self-reported
    • Repeated secondary can add up to Major Infraction (Violation?) status
  • Major Violations
    • Provides competitive advantage
    • Malicious or otherwise intentional
    • Includes academic fraud, inducements, and failure to promote an atmosphere of compliance

When a major violation is found, an investigation is launched, reported to the enforcement committee, and the allegations are laid out in a meeting. If all parties accept the allegations in the report, a summary disposition may be conducted. There’s a lot more layers to this that the book doesn’t seem very interested in organizing.

Large programs employ outside counsel to prevent major infractions from happening and/or being caught.

The LSDBi is a database of NCAA rules and infractions. Seems really useful!

The CAi is a website that allows compliance administrators to keep detailed records regarding their institution’s current student-athletes and athletic teams. Sounds like what we’re doing also!! That is, at my jorb.

Three prongs of Title IX compliance:

  • Prong 1: Providing athletics participation opportunities that are substantially proportionate to the undergraduate student enrollment
  • Prong 2: Demonstrating a history and continuing practice of expanding opportunities for the underrepresented sex.
  • Prong 3: Full and effective accommodation of the interest and ability of the underrepresented sex.

Prong 1 is the “safe harbor” option but all three are viable.

The definition of sport is apparently also an area of serious inquiry (for example, whether to include something like cheerleading in the calculation)

  • Does the team prepare for and engage in competition?
  • Is it administered by the athletics dept?
  • Is the primary purpose competition or support of other teams?
  • Is it widely viewed as a sport?
  • Is the activity recognized by an athletics conference?

There’s some more Title IX stuff but I’m losing the will to live.

Chapter 3: Leadership and Management

Looks familiar!!!

  • LEADERSHIP
    • Vision
    • Mission
    • Core Values
    • Value Culturization
    • Situational Vision and Decision Making
    • “Transformational Leadership Dimensions”:
      • Vision
      • Inspirational Communication
      • Supportive Leadership
      • Intellectual Stimulation
      • Personal Recognition
  • MANAGEMENT
    • Staffing
      • Use of Search Firms
    • Organizing
    • Evaluating

Also there’s a sideblock on “Showing Initiative Without Taking Liberties”, gulp! That’s one thing I’ve been thinking about a lot having been effectively promoted at my job already. Luckily the sideblock says it’s not easy and there’s no one right answer, which is good because it’s scary!

Ok let’s just get this exam over with ^_^;;

Chapter 2: Governing Bodies

Three levels of control:

  • Institutional
  • Conference
  • National

Conferences can range in size, the largest is the Eastern College Athletic Conference, with D1, D2, and D3 championships (I assume in multiple sports, from the way it’s written).

There are alternatives to the NCAA (who knew), including the NAIA, the NJCAA, and the NCCAA. The newest is the USCAA, formed in 2009.

Internal and External stakeholders in collegiate athletics:

  • Faculty
    • Not commonly very deeply involved as a group
    • FAR is a key role in being liaison between athletics and other faculty
  • Governing boards
  • External stakeholders
    • Fans & alumni
    • The media
    • Entertainment industry
    • Sports apparel industry
    • The government

Conference musical chairs

Page 28: schools changing conferences over the last 5 years (from publication)

NCAA governance structure

  • The executive committee has the power to convene the entire association and controls the other boards of directors/leadership councils
  • Each division has its own governance
    • Division 1 is the subject of the Module 1 discussion
  • Executive leadership is biased towards D1 by design
    • Used to be equitable (what a world that must have been)

81% of NCAA revenue comes from TV contracts…

Probably more things to come, I’m tired.

Chapter 1: A Brief Historical Perspective on Intercollegiate Athletics

New class who dis

(This book only has 12 chapters! It’s one of the smallest of the books I’ve had so far. Also I rented it because I ain’t tryna do this)

The college experience apparently used to be awful, like everything else. The first intercollegiate sporting event was a “regatta” (boat racing event) between a Harvard team and three Yale teams, complete with food and socializing, in 1852. This spread and became a model for other sports to develop collegiate programs.

This whole chapter reads as a back and forth between athletics programs and the faculty of the colleges. Illustrates examples such as boosters “hiring” students and the formation of the ICFR by faculty to regulate student-athletes.

The 1904 football season had 21 deaths (this is where TR intervened and formed the IAA in 1905, renamed the NCAA in 1912 (booooooo (well Avatar Kyoshi did found the Dai Li, so I find this analagous))).

So it looks like the underground economy paying athletes for performance illegally has a long and storied history. It’s a little weird that the book isn’t talking about how this is going on to this very day…

The Sanity Code was created by the NCAA in 1948 as a compromise between southern schools that wanted to award full athletic scholarships and northern schools that were opposed to athletic scholarships.  The Sanity Code outlined that athletic scholarships should be need-based financial aid, not pay-for-play.

Notre Dame and Penn actually negotiated their own television contracts before the NCAA took over and signed contracts, and threatened Penn with being not in good standing. So that was a whole thing. The NCAA’s first billion dollar agreement for men’s D1 postseason basketball (March Madness) was in 1989, and doubled by 1995. When was this book published??

This book actually briefly describes the horrors of the “Indian Problem,” the struggles of dealing with the KKK (the “fighting Irish” origin is actually more badass than I realized), HBCUs, and the growth of women’s sports. Not bad! Pretty dense chapter.

And the chapter ends with the description of a paradigm. And that’s the end of our show! Bonk!

Chapter 8: Sources of Public Sector Funding

Be sure to know all the basics before our interview with Dr. Luy tomorrow!

Two types of money sources discussed here: taxes (can be general or selective), and bonds (government borrows money to pay for things).

Types of taxes:

  • General taxes
    • Property taxes
      • Real property
        • Land
        • Buildings
        • Etc.
      • Personal property
        • Vehicles
        • Stocks/bonds
        • Patents
        • Etc.
    • Sales Taxes
      • Regressive by nature (property taxes are as well!)
      • Can be used to fund specific projects
  • Selective Taxes
    • Tourist taxes
      • Hotels, car rental, etc.
    • Sin taxes
      • Alcohol, cigarettes, lotteries, etc.
      • Many states have lotteries can be used to fund all kinds of things
        • Except Hawaii and Utah!
    • Jersey tax
      • No one has actually gotten this through a legislature yet though
  • Income Tax
    • It is actually legal to impose state tax on business done within the state, including sports games!
  • Game-Day Surcharges
    • Primarily additional cost to tickets and parking at events

Debt Financing: many ways to make the money move.

  • Three vital principles for using debt to make things happen:
    • Use more time to make the tax burden less onerous
    • Use more time to make the financial pain smaller and get the rewards up front, for politics
    • Use more time so that the beneficiaries are paying (people who leave or come are paying for what they have access to).
      • Note that the debt should still only reach out to the expected end of usefulness of the product, or else you’re paying money for nothing on the back end.

Bonds!

  • Straight serial method
    • Paying more up front, interest decreases to end
  • Graduated serial method
    • Paying less up front, more total interest

Bond rating is mentioned, including S&P rating. Ahh memories. I wonder if the USA’s credit score is back up to AAA.

Tax-exempt bonds can only be issues by governments. In 1986 the Tax Reform Act was passed to try and prevent cities from using tax-exempt bonds to pay for stadiums but there were loopholes (of course) and things got messier.

Some blast from the past of sport marketing! Specifically w/r/t getting a new bond passed.

  • Market segmentation: different groups behave differently and have different priorities
  • Benefit principle: sell based on desire
  • Development of a strategic plan: campaign before the referendum to create the best chance for success

Bonds are guaranteed debt. There are also non-guaranteed debt instruments:

  • Revenue bond
    • Paid specifically from revenues generated by facility
  • Certificate of participation
    • Public trust model
      • A nonprofit or other org acts on behalf of the government entity
    • Public-private partnership model
      • The local government itself behaves as the intermediary
  • Tax-Increment Financing Bonds
    • Paid for by the increase in property values and resulting increase in property taxes
      • Super attractive, but be suspicious, people will eagerly assume it can’t fail
  • Asset-Backed Securities
    • Securitization
      • Selling future revenue streams to investors
    • Player sale-and-leaseback arrangement
      • European football instrument for trying to get more money

Chapter 4: Trends in Sport Facility Financing

OUTLINE:

  • Sports Facility Boom
    • Measurement challenges
    • Description of the trend tables
  • The evolution of facility funding
  • Who pays and how much?
    • Cost sharing trends for arenas & stadiums
  • Factors contributing to increased team/owner investment in facilities
    • The equity issue
  • Factors contributing to continuing public subsidies
    • Owner leverage
    • The community power structure
  • The rationale for public subsidy
    • Trends in the minor leagues
    • Trends in colleges

Let’s just take a quick overview today…. no quiz available yet, not sure there will be one.

Ok I saw the thing about GWB and I’m so mad I don’t want to do this anymore.

Chapter 3: Challenges Facing Professional Sports

Leagues covered:

  • Big 4
    • NFL
    • NBA
    • MLB
    • NHL
  • Other major leagues
    • MLS
    • WNBA
  • Minor leagues
    • mLB
    • AFL
    • NBDL
  • Probably some other ones

The 1990s were a time of huge growth, but after the market saturated and the recessions things have gotten tougher.

The NFL is covered starting on page 92. A profit margin of 23.8% is INSANE. Good god.

The NBA is as profitable as ever. Only 3 franchises losing money (0 NFL, even the Raiders! lol)

The NHL is the least profitable and has a huge disparity (in terms of %) between the top and bottom teams in revenue. Also 8 teams losing money.

Sample team: Florida Marlins

This is a leaked MLB team’s breakdown. The NFL is the easiest to monitor because of the publicly owned Green Bay Packers.

Lockouts, strikes, and other key parts of CBA negotiation are covered in the next section. NFL CBA is covered on pages 107-108, may need it for the paper.

Do the rest next week. It’s pretty straightforward.

Chapter 2: Challenges Facing College Sports

MONEYYYYYY. Obviously.

But really a big part of the challenges are that it’s an industry, not a service like it should be. This creates an arms race for recruitment, facilities, coaches, etc.

Revenue growth, the rich getting richer, all of these are serious issues with billions of dollars at stake.

Title IX stuff, I already wrote a ton about it for the last class and this one so no rehashing today.

Chapter 1: The Changing and Challenging Economic Environment

The US Economy was “strong” in the 1990s… especially for sports (ok that’s certainly true) and then bad things have happened for more than a decade straight.

Corporate investment in sport was a big trend in the 90s/00s.

I wonder if this book will have the courage to explore why sports used to be recession-proof and now they’re not :3

“The NFL is primarily a television show” smart, because that’s where the real money is eh.

This book is pretty good at laying out the realities but doesn’t seem too interested (at least yet) in interrogating why things are the way they are. Maybe that comes later.

Globalization creates new markets, for those daring enough to collect the support and make a go of it.

Chapter 17: Use of Waivers and Exculpatory Clauses

Pleasantly surprised that this chapter is under 30 pages.

This chapter centers around information exchange, since failure to warn etc. can fall under negligence.

The language you use really matters, if you say the trail will be perfect you can be sued for it not being perfect. So get your marketing department hip with the times.

An exculpatory agreement is a contract where a person or entity that is legally “at fault” tries to excuse itself from fault (also comes in clause format). Can be in either a waiver or a release.

Tort law and contract law are at odds in this case because contracts can include waiving of rights including the right to sue, while tortious acts still create accountability that can be rectified with litigation. These two pillars are at odds and so resolving disputes can get messy.

The main way that waivers turn out to be valuable is when they have the right context and they contain the right content.

Context considerations:

  • Minority
    • Contracts entered into by minors are voidable
    • Parents cannot give up their children’s right to sue
      • Woodman and Hamill cases reflect opposite outcomes when injury occurs to a minor with a charge of negligence against the operator
  • Public Policy
    • Some jurisdictions will not uphold waivers
    • Consideration whether an essential service is being provided
      • e.g. waivers not valid in medical setting
      • Tunkl vs UC Regents case sets precedent for college activity being an essential service
      • A university cannot release itself from all liability with a required waiver
    • The principle of unfair dominance is that a waiver that is one-sided will not be upheld
      • e.g. if the activity is required and no alternative is provided
    • Waivers cannot be used to violate a statuatory duty of care
      • e.g. not caring for and maintaining the premises

Content considerations:

  • Terms must be conspicuous
  • Language must be clear, unambiguous, and explicit
  • Language cannot exonerate beyond negligence
    • Gross negligence, reckless behavior, and intentional torts cannot be waived away
  • Decision whether to use exculpatory clause is important
    • Must be consistent with mission of org

Sample Agreement to Participate:

Sample Agreement to Participate