The NCAA Death Penalty: A Review of Legal and Business Implications

INTRODUCTION The NCAA is an organization comprised of 1,281 institutions in United States and Canada that voluntarily subscribe to membership principles for their intercollegiate athletic program Division I football is divided into Football Bowl Subdivision (FBS) and Football Championship Subdivision (FCS). It consists of major collegiate athletic powers and is highest level of intercollegiate athletics sanctioned by NCAA in United States. Division I schools usually possess larger budgets, more elaborate facilities, and more athletic scholarships than Divisions II and III. As a regulatory environment, NCAA is unique in that membership is voluntary. There are, however, two compelling reasons for institutions to participate in a self-induced regulatory environment. The first reason is money. In NCAA's 2008-09 distribution plan, approximately $20,667,000 was allocated for enhancement of academic support programs for student-athletes at Division I institutions. This means that each Division I institution received a payment of $62, 438. Further, basketball fund provides money that is distributed to Division I conferences based on their performance in Division I Men's Basketball Championship over a six-year rolling period. For example, for 2008-2009 distribution, rolling period would be 2003 2008. The total distribution for 2008-09 was $154.7 million (Rosner & Shropshire, 2011). The second reason for institutions to participate in NCAA is competition. While NCAA member institutions are permitted to compete against non-member institutions, conference competition consumes most of an institution's schedule. This typically leaves few openings for competitors outside conference. Therefore, establishing a schedule of competition with reasonable travel expectations, would become nearly impossible. In addition, these spots on schedule are often occupied by larger institutions who often pay smaller institution to play at larger institution. Further, if an institution is not a member of NCAA, it may not participate in NCAA sponsored championships. This will often make recruitment of student-athletes more difficult. HISTORY AND EVOLUTION OF THE NCAA AS A REGULATORY AGENCY Regarding regulation, between 1840 and 1910, there was a movement from loose student control of athletics to faculty oversight, from faculty oversight to creation of conferences, and ultimately, to development of a national entity for governance purposes (Rosner & Shropshire, 2011, p. 480). These changes stemmed from high number of deaths in injuries in sport of football. In 1905, there were 18 deaths and nearly 150 major injuries in intercollegiate football. The issue scored national attention when President Theodore Roosevelt called a conference of major football programs at White House. However, deaths and injuries in sport persisted (Rosner & Shropshire, 2011). The Chancellor of New York University, Henry M. MacCracken, invited presidents of other schools to discuss reform or abolition of football. Thirteen presidents met and declared their intent to reform game of football. When same group met three weeks later, 62 colleges and universities were represented. This group formed Intercollegiate Athletic Association of United States (IAAUS). In 1912, group took name National Collegiate Athletic Association (NCAA) (Masteralexis et al, 1998). In 1929, The Carnegie Foundation visited 112 colleges and universities and found many academic abuses, recruiting abuses, payments to student-athletes, and commercialization of athletics. The Carnegie reports established that responsibility for college athletics lies with president and faculty of institution. Therefore, the NCAA was pressured to change from an organization responsible for developing playing rules used in competitions to an organization that would oversee academic standards for student-athletes, monitor recruiting activities of coaches and administrators, and establish principles governing amateurism, thus alleviating paying of student-athletes by alumni and booster groups (Masteralexis et al, 1998, p. …

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