That’s true, but $5,000 annually per student-athlete is a drop in the bucket compared to the billions of dollars in revenue the schools generate. For example, using college revenue data from the U.S. Department of Education, the 2011-12 Kentucky men’s basketball team generated $23.2 million in revenue and had $13.7 million in expenses attributable to intercollegiate athletic activities after a 38-2 season, which equates to $250,765 per win net of expenses. That would be equivalent to $260,320 in 2014 dollars.
During the 2013-14 season the Wildcats went 29-11, led by freshman Julius Randle, who was credited with 5.9 win shares, an estimate of the number of wins contributed by a player because of his offense and defense. At $260,320 per win, that puts his value to the university at more than $1.53 million. By paying him $5,000, Kentucky gets full value after just four minutes of play.
Andrew Wiggins produced 4.9 win shares for Kansas, putting his value at $904,205 based on Kansas’ financial records from 2012. If we use the $141,862 average net per win across all Division I-A schools, Wiggins’s value drops to $695,123 and Randle’s to $836,990.
But what about a less flashy school such as Baylor University, whose men’s basketball team went 26-12 and was ranked 23rd in the final Associated Press poll of the season? Their wins, when isolated from the league at large, were worth $8,186 net after expenses, which would have pegged forward Corey Jefferson, their leader in win shares (4.9), at slightly more than $40,000.
The average NCAA basketball player was worth $212,080 during the 2013-14 season, about the same as the average value of a player in his junior year.
I am not sure what the fair value for NCAA Division I-A men’s basketball players is, but based on the amount of money these programs net after expenses, $5,000 per year doesn’t seem to be close to enough.