Autonomy Legislation: What Does it Mean for Memphis?

Discussion question: Is Memphis Football more likely to be the next TCU – an upstart football program who went from being a lower level team in a “mid-major” league to winning the Big XII in just a few years – or the next UAB, a non “Power 5” school who recently decided to drop football after years of fan apathy towards a program that exists in the shadow of the mighty SEC?

Though the inclination is clearly to say TCU, it’s a scary question to ponder for Memphis fans – considering that 2 years ago they certainly had more in common with UAB – and still exist in the AAC, a so called “Group of 5” conference.

Autonomy for the “Power 5” conferences has sparked a lot of discussion and fear at schools outside that designated group (AAC schools such as Memphis) regarding their future ability to compete at the highest level of college athletics. In case you don’t already know, the NCAA’s new structure allows for the 5 wealthiest conferences to pass legislation on their own – legislation that would then be enforced on that group (the “Power 5”). Other conferences, such as the AAC, would then be free to follow suit, or not – depending on the desires of their membership.

On Saturday, the first autonomous legislation was actually passed – so everyone can now begin to see the real effects of the NCAA’s new legislative structure.

What does it all mean for Memphis?

Here’s an attempt to answer that and other questions related to the NCAA process:

1. So what actually happened yesterday?

Several resolutions were passed, including:

  • A joint resolution, sponsored by all five conferences (SEC, PAC 12, B1G, ACC, Big XII), on “modernizing the collegiate model,” which was intended to set the tone for the future
  • A proposal to pay full cost of attendance for student athletes (above and beyond the typical scholarship)
  • A concussion safety protocol
  • A proposal to guarantee scholarships for 4-years
  • A proposal that granted athletes the ability to borrow against future earnings to buy loss-of-value insurance, which reimburses athletes if playing in college ends up harming their future earning power in professional sports

2. Does this signify a problem for Memphis or the American Athletic Conference?

Doesn’t seem to, no. The commissioner of the AAC, Mike Aresco has long insisted that his conference is prepared to follow suit and enact additional enhancements for student-athletes. Specifically, last year the AAC announced that its schools were already committed to providing full cost of attendance if it passed. So now that’s done. The proposals to guarantee scholarships, allow for borrowing to purchase insurance and to alter concussion protocols are areas that the AAC will have to consider – but none would seemingly have game-changing budget ramifications.

The issue of concern for the AAC is making sure none of the legislation puts its schools at a competitive disadvantage beyond the financial disadvantage which already exists.

Again, autonomy means the AAC is permitted to follow suit but doesn’t have to if it doesn’t want to. The best guess is they will do everything the “Power 5” does unless it’s just impossible financially or if the AAC sees some competitive value in doing something differently. The agenda for the AAC is to continue to be thought of in that group – at the highest level. Autonomy was really meant to cut out those schools at the lowest level of D1 – schools that were slowing down the legislative process and making it impossible to get anything done.

In fact, it’s interesting to note that the proposal to guarantee scholarships didn’t even have unanimous approval in the “Power 5” – it was voted against by 2 of the conferences and almost half of voters. It’s unclear exactly how that proposal will be enacted and whether or not it effects scholarship limits.

3. So what’s the problem – for Memphis and the AAC?

The problem is what it’s always been – that the AAC schools, like Memphis, have way less TV money to begin with – so any cost increases are going to be felt more acutely at member schools. Some analysts have speculated that non-revenue sports will eventually be cut. Schools at the AAC level already rely more on student fees and other subsidies to make the numbers work. It’s a squeeze. This makes it worse.

Memphis and other AAC schools have known for a year that cost-of attendance was coming, so they’ve had time to tighten their belts and prepare for the added expense. In the USA today summary from yesterday, Auburn athletic director Jay Jacobs said his school has added $2 million to the budget to pay for items including full cost-of-attendance scholarships. In the grand scheme of things, that’s not all that drastic a number. It’s unclear that any of the other proposals enacted yesterday will have a significant effect on budgets.

4. So is it possible Autonomy is actually good for Memphis?

Yes, it’s possible. If the AAC can clearly establish itself – along with maybe the Mountain West – as conferences in that next tier, then perhaps they can do enough and earn enough to stay closer to the “Power 5” while at the same time distancing themselves competitively and financially from the other “Group of 5” conferences (Sun Belt, MAC, CUSA). In other words, it’s possible only a few conferences outside the “Power 5” have the wherewithal to keep up the fight. Keep in mind a CUSA school – UAB – just dropped football because they felt it was no longer worth it. There is a growing chasm and it’s important that AAC schools position themselves on the proper side.

Look for the AAC to adopt all permissive legislation and continue to fight for market share and TV dollars. The AAC is going to have to prove it where it counts – in the TV ratings. The consequences are drastic.

The key will be what measures are passed by the autonomous group and how much they cost to implement.

Remember, just because SEC schools have more money, doesn’t mean they’re eager to spend it on things they’re not already spending it on. Athletic Directors make a lot of money. Coaches make a lot of money. Heck, in the SEC, defensive coordinators make almost $2 million per year – so don’t get the idea that there’s a lot of money that AD’s are just looking to throw around.

The unspoken goal is to do just enough to get public pressure and legal pressure off the back of college athletics while doing as little as possible to disrupt the gravy train.

5. So what’s next?

As far as the next round of legislation – it’s not clear. Some possibilities are: (a) a proposal to allow schools to pay for family travel, (b) proposals related to agents, (c) proposals related to allowing athletes to be paid for their likeness.

Memphis and the AAC have to keep up enough so that schools outside of football (particularly men’s basketball) at the “Power 5” level do not have a competitive advantage in recruiting. I say “outside of football” because let’s be honest, there’s already a competitive advantage in football recruiting. The “Power 5” get all the elite recruits in football and everyone else splits the others. That’s been happening for years. Perhaps that gap can be shrunk – but there’s currently no gap in men’s basketball. Schools outside the “Power 5” will have to make sure that doesn’t change.

6. How is the AAC / Memphis positioned?

The AAC in particular has one giant asset at this point – it’s television contract with ESPN. No, it doesn’t pay a lot of money – though there’s some talk of a “look-in” period in the contract that will allow a renegotiation within a few years. The great thing about the AAC’s contract is that it provides an unprecedented amount of national converge for member schools. AAC schools have been on ESPN channels more in the past year – in football and basketball – than in their entire histories combined. From Memphis’ and the AAC’s perspective, this absolutely has to translate into better recruiting, better competition, increased fan support and increased TV ratings – so that ESPN will recognize value in the product and hand out more money next time (for purposes of this discussion, let’s assume the Big XII isn’t expanding).

Put bluntly, the AAC has to bring similar value to its television partners as the ACC or Big XII if they want to be compensated in the same ballpark. This will ultimately decide whether Memphis and the AAC end up closer to the P5, or closer to UAB.

It’s an uphill climb, but so far nothing has appeared on the horizon which would purport to make survival seem unlikely.