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Virginia Bill Seeks Looser Limits on College Sports Tuition Subsidies
Virginia state Sen. Creigh Deeds, a Democrat from Charlottesville, has proposed a bill to edit an existing law that caps the amount of tuition subsidies that Virginia public schools can direct toward athletics.
The legislation would remove a paragraph in a decade-old statute that requires any new student fee revenue allocated toward athletics to be matched with a proportionate increase in generated revenue from elsewhere, and expands the list of expenses that are exempt from the cap's calculations.
Deeds' bill also asks the state's joint legislative audit and review commission to study the impact of its current limitations on student fee revenue "in light of evolving trends in intercollegiate athletics institutions and organizational structures and policy," and to consider how they impact a school's ability "to maintain competitiveness" in college sports.
Deeds, chair of the commerce and labor committee, introduced Senate Bill 1217 on Jan. 8; it was subsequently referred to the committee on education and health. Virginia's general assembly is in the midst of this year's short session, which concludes on Feb. 22. Any legislation would have to pass out of its chamber prior to the "crossover" deadline on Feb. 5 for it to have a chance of being enacted in 2025. Deeds did not respond to multiple requests for comment left with his office.
Across the country, universities are scrambling to find new–or double down on old–ways of raising money with the House v. NCAA settlement paving the way for revenue-sharing with athletes. Schools will be able to share up to $20.5 million next year should the settlement be approved, creating a new line item that has universities up and down Division I assessing their financial capabilities.
Virginia Commonwealth University, a non-football DI school based in Richmond, plans to spend up to $5 million on compensating its athletes next year, according to the Richmond Times-Dispatch. Virginia Tech has said it will spend the full $20.5 million. Meanwhile, UVA saw its celebrated head men's basketball coach, Tony Bennett, abruptly resign before the current season, citing the challenges for coaches of an increasingly professionalized labor force.
In 2015, Virginia passed a law that set athletic subsidy percentage caps for its various types of public institutions: for D-I Power Five schools, 20%; for non-Power Five D-I schools, 55%; for Division I-AA (now FCS) schools, 70%; and higher percentages for lower levels. The measure was proposed by the state's GOP House majority leader, Kirk Cox, a James Madison graduate, who contended that non-athlete students were shouldering too much of the burden of supporting athletics.
Cox's bill, which received bipartisan support, required that for each fiscal year, "any percentage increase in the subsidy … shall be matched by a like percentage increase in generated revenue," based on a five-year rolling average.
Deeds, whose district includes the University of Virginia, is proposing to immediately do away with that latter requirement. His effort follows Virginia's enactment, last July, of the first state NIL law (or second, if you count California) permitting schools to directly enter into NIL deals with college athletes. Since then, several other states have adopted similar provisions in the spirit of competition. Now, with revenue-sharing on the horizon, the new challenge is how to pay for it.
Historically, the Division I athletic programs in Virginia have been heavily dependent on tuition auxiliary fees.
All four of the state's FBS schools ranked in the top 20 in student fee subsidies in fiscal 2023, according to Sportico's college sports finances database. James Madison and Old Dominion were first and second, respectively, at $53.3 million and $30.3 million, with Virginia at No. 10 ($16.1 million) and Virginia Tech at No. 17 ($13.4 million).
The schools argue that some of this owes to more transparent accounting. In addition to higher student fee subsidies, the schools also report far less "direct institutional support" than their peers. JMU athletics, for example, while leading the nation in student fee subsidies, reports less than $2 million in other money from the academic side of the school or its general fund. Sun Belt Conference rival Coastal Carolina, as a comparison, reported $6.9 million in student fees and $21.2 million in direct institutional support in fiscal 2023.
JMU, which completed its move up to FBS in 2022, appears likely to have dominated the category again last fiscal year, reporting $55.5 million in student fees. While the school is not currently compliant with the law's 55% cap, it is within a few percentage points, an athletics spokesman said, and it is on a multiyear state-approved timeline to become compliant following the FBS move. The increase in student fees from fiscal 2023 to 2024 was due primarily to an increase in enrollment, said the spokesman, who declined to comment on Deeds' bill proposal. Spokespeople for Virginia, Virginia Tech, VCU and Old Dominion either declined comment or did not respond to email inquiries.
JMU finished this past football season with a 9-4 record and a victory over Western Kentucky in the Boca Raton Bowl. That followed the Dukes' 11-2 inaugural FBS campaign in 2023-24, which saw year-over-year football ticket revenue grow by almost $700,000. Meanwhile, JMU has seen its athletic spending increase by $18.6 million (32%) since joining college football's top subdivision.
The original 2015 Virginia law listed a few types of expenses that are exempt from the cap calculations. They include costs associated with spirit squads and debt service for previous projects. Deeds' proposed amendments would add money used to "promote student-athlete mental and physical health" to the list of exemptions.
Under the bill, public schools would need to submit annual finance reports to a number of state agencies, including the Auditor of Public Accounts, the governor, the Senate Committee on Education and Health, and the Senate Committee on Finance and Appropriations.
It also encourages lawmakers to review the rest of the original Cox bill to see if more changes are necessary. It says any findings and recommendations from that review should be submitted by Nov. 15.