‘Taxation Without Representation’: What the NCAA’s $2.8 Billion Settlement Means for Harvard

A nearly $2.8 billion settlement proposed by the National College Athletics Association and the Power Five Conferences will allow collegiate athletes to be paid by their universities — a historic shift that may leave Harvard Athletics bleeding.

The settlement — which comes amid larger questions about the Ivy League’s athlete scholarship and compensation policies — will leave universities like Harvard on the hook for significant portions of the payout as they combat growing incentive for athletes to depart for larger programs that offer pay.

College spokesperson Jonathan Palumbo declined to comment for this story.

House vs. NCAA, the primary case being settled, represents the latest in a series of changes to the role of players in collegiate athletics that began in 2021 when the Supreme Court ruled that NCAA players could make money in advertising deals while remaining eligible.

In the years since the decision, name, image, and likeness collectives — booster-funded groups that pay athletes — have brought huge sums of money to some programs.

The agreement was voted on by the NCAA and the Power Five NCAA Conferences — the Atlantic Coast Conference, Big Ten Conference, Big 12 Conference, Pac-12 Conference, and Southeastern Conference — throughout the week of May 19. It will allow players going from as far back as 2016 to be compensated for previously not being able to profit from their name, image, and likeness.

While the settlement may incur financial costs for Harvard, the introduction of athlete pay may present a much larger risk to the school’s recruiting pull, according to Michael H. LeRoy, a law professor at the University of Illinois.

“This will increase the magnetic pull for the Power Five Conferences and it will create roster disruptions for the Ivy League,” LeRoy said.

Alumni have also raised concerns that the University’s lack of financial offerings hinder its ability to draw star talent.

Harvard currently lacks an NIL collective and sent a letter to donors last May distancing itself from a supposed attempt to establish one. Harvard Athletic Director Erin McDermott maintained in April that the University has “been able to stay competitive” without offering athletic scholarships.

In the spring alone, Harvard’s basketball program lost star freshman Malik A. Mack ’27 to Georgetown and Chisom Okpara ’26 to Stanford.

The departure of Mack, an Ivy League rookie of the year who led the team in points and assists this season, was particularly consequential.

The other part of the proposed settlement will allow schools to share revenue with players, up to $21 million per year for Power Five schools.

The NCAA has agreed to pay about 40 percent of the nearly $2.8 billion sum. The other 60 percent is set to be divided between the conferences, with 40 percent being paid out by the Power Five Conferences and the remaining 60 percent by the other conferences.

The division means that schools like Harvard will have funding withheld by the NCAA for the coming years, despite much of the settlement money being directed to Power Five school football and men’s basketball players.

The NCAA’s 2022 tax filings show that Harvard received $885,597 from the NCAA for scholarships and grants that year, while the Ivy League itself received over $6.3 million.

While the precise cost of the settlement for Harvard is currently unclear, Ivy League Executive Director Robin Harris characterized the deal as “bailing out” the richer conferences to the New York Times in May.

“The Ivy League isn’t under attack in these suits, and we’re bearing the costs from the majority who are, so it’s frustrating,” she said.

Richard Kent, a lawyer who consults for a group running NIL collectives, called the settlement “taxation without representation” in an interview with The Crimson, noting that conferences that refuse to accept the terms of the deal would be unable to participate in NCAA championships.

LeRoy called the disproportionate burden falling on smaller conferences “a power play by the power conferences.”

Still, he said he expects the smaller conferences to object to the settlement and Judge Claudia Wilken — who ultimately has the authority to approve or deny the settlement — to change the terms.

“I fully expect them to oppose the settlement and to argue directly to Judge Wilken that it is an unfair distribution of costs,” LeRoy said. “So I would anticipate that this will undergo some revision.”

But for Kent, the ramifications of the settlement for Harvard specifically isn’t the most relevant question.

“How much does it hurt a school with a $50 billion endowment?” Kent said.

“This lawsuit is bigger than Harvard,” he added. “This lawsuit is evolutionary in terms of college athletics.”

—Staff writer Jo B. Lemann can be reached at jo.lemann@thecrimson.com. Follow her on X @Jo_Lemann.

—Staff writer Tyler J.H. Ory can be reached at tyler.ory@thecrimson.com. Follow him on X @tyler_ory.