Revenue Sharing Frequently Asked Questions “FAQs”
Revenue Sharing Frequently Asked Questions “FAQs”
- Under the terms of the recently enacted House Settlement, starting in the 2025-26 academic year, a new system will allow institutions to provide significant revenue sharing to athletes.
- Additionally, backpay will be awarded to those athletes who participated from 2016 to 2021.
- All NCAA sports will now adhere to roster limits, and schools will have the ability to offer scholarships equal to the number of roster spots for each sport.The anticipated annual revenue share of $20.5 million will go directly to athletes and is expected to increase each year.
To meet the new NCAA scholarship limits, the educational costs to support these additional athletes are expected to rise by several million dollars annually. Our collective commitment to embracing these changes, exploring new revenue opportunities and responsibly managing our resources will be essential to our ongoing success.
We will need the support of everyone associated with Kentucky Athletics to ensure the long-term viability of our athletic programs.
Frequently Asked Questions
Will athletic departments be mandated to participate in revenue sharing with athletes?
Participation in revenue sharing is not compulsory. Departments can opt to pay up to an estimated $20.5 million annually but may choose a lower amount at their discretion. Kentucky Athletics intends to fully participate.
How was the $20.5 million figure for revenue sharing determined?
The $20.5 million is currently an estimate based on a percentage of average revenue generated by “Power Five Conferences” (now Power Four) across various categories, including media rights, ticket sales, licensing and corporate sponsorships. When combined with athletic scholarships, this figure represents approximately 50% of the total revenue allocated to athletes, akin to revenue-sharing models in professional sports.
When will revenue sharing start for current athletes?
The settlement is scheduled to take effect July 1.
How will the revenue share be distributed among the teams and athletes? Is every athlete required to receive a share?
There is no mandatory distribution formula for the revenue share. UK Athletics has been studying how we will make the revenue distributions, with decisions to be finalized in the coming weeks, and while also realizing there will be variability from year-to-year depending on the needs of individual programs and the department as a whole.
How do the new settlement roster and scholarship limits work?
The settlement provides for a limit to the size of each team roster. Schools may elect to award full scholarships up to the roster limit.
How will Kentucky adjust to the new roster/scholarship limits?
As of now, we plan to increase our number of scholarships in almost every sport to maintain our competitiveness in the Southeastern Conference and the other three leagues in which we compete (Great America Rifle Conference, Sun Belt for men’s soccer, Mid America West for STUNT).
The settlement also calls for approximately $2.7 billion in backpay for student-athletes from 2016-21 who were not allowed to participate in name-image-likeness compensation. What is Kentucky’s role in that?
UK also will have responsibility for paying its share of that part of the settlement.
How does the settlement affect name-image-likeness opportunities?
Student-athletes may continue to earn name-image-likeness (NIL) compensation. However, every NIL agreement worth more than $600 will be evaluated through a national clearinghouse, which will determine fair market value for the agreement. Fair market value will be determined by a number of factors that will be finalized before the settlement goes into effect on July 1.
How will the additional expenses — $20.5 million for revenue share, $5 million for additional scholarships, normal increases in annual expenses etc., be financed?
It’s important to note that these are not new revenues for UK Athletics that are being redistributed for these purposes. There is no pool of “new money” to finance these costs. UK Athletics must pay these costs through current and new revenue streams — ticket sales, fundraising, media rights, etc. — along with reductions in spending to finance the new expenses.
How can I help?
The best way to support Kentucky Athletics is by continuing to invest in our programs. You can do this in several ways, such as becoming a season ticket holder, contributing to the K Fund, attending individual athletic events and partnering as a corporate sponsor. For more information on how your support impacts our athletes, please visit ukathletics.com/k-fund.
Does this mean NIL initiatives will disappear?
No, the introduction of a revenue sharing program will necessitate collaboration among various groups to benefit all athletes. Kentucky Athletics has multiple valuable partners and plans to maintain a relationship with them that ensures they work to benefit UK athletes.
