The University of Tennessee Board of Trustees on Friday approved the university’s plan to create a nonprofit foundation that could quickly mobilize into a fund to pay salaries to athletes if the NCAA one day allows such direct compensation.
As reported by the Knoxville News Sentinel, the plan would also prepare UT to make the cut if a super subdivision of the wealthiest college sports schools breaks away from the rest of Division I.
“It’s really an effort to try to be agile and be ready for the coming changes,” Chancellor Donde Plowman said, as reported by Adam Sparks of the News Sentinel.
Like other universities with similar foundations, including a reported 11 of 14 Southeastern Conference schools, UT's version could also be used to improve the athletic department's operations efficiency. "For example, if an expensive but unique piece of athletic equipment had to be purchased quickly, UT could do it through the foundation in some instances without going through a lengthy bidding process," Sparks wrote.
As reported by Sparks, NCAA president Charlie Baker proposed a plan in December to create a new Division I subdivision in which schools would be required to pay at least half their athletes a minimum of $30,000 a year through a trust fund.
“If that came to fruition – and I don’t know that it will – but something like it is probably likely, we need a mechanism to do that,” Plowman said. “So the foundation would be an example of how we would put revenues from the athletic department into that foundation that we could use to pay the student-athletes.”
The board of trustees has so far given UT permission to form the new nonprofit foundation, meaning it can apply for tax-exemption status and submit organizational documents to establish the entity under state law. UT must return to the board of trustees for further approval before the foundation becomes operational, finalizes a governance structure or raises any money, according to Sparks' report.
