The NCAA News - News and Features

The NCAA News -- January 4, 1999

Governmental affairs report

Following is a summary of legislative highlights of the 105th Congress from January 1997 through December 1998 prepared by the NCAA federal relations office. Copies of all documents, bills and correspondence in this report are available from the federal relations office, One Dupont Circle, N.W., Suite 310, Washington, D.C. 20036; telephone 202/293-3050.

Academic eligibility standards

In 1997, the U.S. Department of Education began an investigation of the financial aid records of 22 NCAA member institutions. The purpose of the investigation was to determine if Pell Grants had been awarded fraudulently to students at those institutions. The department suspects that the family income reported on the grant applications was understated to provide higher grant awards. The investigation is ongoing.

The National Association of State Boards of Education and the National Center for Fair and Open Testing (FairTest) continued to object to the NCAA's initial academic eligibility process for entering college freshmen. Both groups attended the 1998 NCAA Convention to bring attention to their opposition to the NCAA core-course review process and the use of standardized testing as indicators of college preparedness for student athletes. These organizations also sought support from Congress and other education organizations to join in their efforts to force the NCAA to alter the core-course review process and reliance on standardized testing to determine student-athlete eligibility.

On May 26, 1998, the NCAA entered into a consent decree with the U.S. Department of Justice related to initial-eligibility standards and procedures for student-athletes with learning disabilities. Justice conducted a three-year investigation of the NCAA's initial-eligibility process and concluded that the NCAA violated Title III of the Americans with Disabilities Act (ADA). Prior to the agreement and as part of the agreement, the NCAA revised initial-eligibility policies in order to allow for educational records of learning-disabled students to be more fairly assessed. Although the NCAA agreed to make substantial accommodations for students with special needs, the NCAA did not agree that the ADA applied to the Association.

Amateur sports act

On October 21, 1998, the President signed into law legislation (P.L. 105-277, House Report 105-825) that made the first changes to the Amateur Sports Act in 20 years. Key provisions of the legislation include changing the title of the Act to the "Ted Stevens Olympic and Amateur Sports Act," creating an ombudsman to represent Olympic athletes in disputes with the USOC, Paralympic and Pan American competition, and fully integrating the Paralympic Games into the Olympic community.

Athlete agent issues

During the 104th Congress, two bills were introduced to regulate athlete-agent conduct and impose federal penalties for violations. Over the last two years, numerous states have adopted athlete agent laws. Although discussed by one member of Congress, no federal legislation was introduced related to athlete agents in the 105th Congress.

In June 1998, the U.S. Securities and Exchange Commission (SEC) launched a formal investigation into the role sports agents play in their clients' investments.

Bowl alliance issues

In May 1997, the Senate Judiciary Committee conducted a hearing on the antitrust implications of the College Bowl Alliance. Members of the committee did not pursue further action when it was learned that the Alliance reached an agreement with the Western Athletic Conference and Conference USA.

Campus drug and alcohol policy issues

During the 1997-98 term, the U.S. Supreme Court refused to hear a drug-testing case related to the random testing of high-school students participating in extracurricular activities. The justices, without comment, upheld the Seventh Circuit Court of Appeals ruling that random testing of students does not violate the students' privacy rights.

At several public forums related to higher education over the past two years, Health and Human Services Secretary Donna Shalala called on college and university presidents to ban the acceptance of alcoholic beverage advertising at collegiate athletics events.

The Higher Education Act Amendments of 1998 (P.L. 105-244, House Report 105-750) includes a resolution proposed by Sen. Joseph R. Biden, D-Delaware, and Sen. Robert C. Byrd, D-West Virginia, calling on colleges and universities to take steps to reduce under-aged alcohol consumption as well as binge-drinking behavior. The legislation authorizes federal grants to be funded to support institutional prevention programs. Grants are to be awarded through a competitive process. In addition, the Act includes a new provision that allows postsecondary institutions to disclose to the student's parent or legal guardian, any violation of federal, state, or local law, or of any rule or policy of the institution, that governs the possession of alcohol or controlled substance, if the student is under the age of 21 and the student is determined to have committed the alleged violation.

Campus violence

On December 23, 1997, the U.S. Court of Appeals for the Fourth Circuit overturned a lower court decision and ruled that a former student at the Virginia Polytechnic Institute and State University could pursue a lawsuit against the university and two former football players under both Title IX and the Violence Against Women Act. The student alleged that the football players had raped her.

In 1997, Rep. Constance A. Morella, R-Maryland, and Rep. Bernard Sanders, I-Vermont, introduced H. Con. Res. 29, calling for a national summit of sports leaders to combat domestic violence. The representatives made an appeal to the House Committee on Education and the Workforce to add the resolution to the Higher Education Act Amendments of 1998, but ultimately it was not included in the final legislation.

The Higher Education Act Amendments of 1998 (P.L. 105-24, House Report 105-750) includes an expansion of the list of campus crimes under the Campus Crime and Security Act reporting requirements as well as new institutes a new reporting requirement. Beginning in the fall of 1999, all institutions receiving federal funds must supply a copy of the institution's annual crime statistics report to the Secretary of Education. The Secretary is required to make the campus crime statistics available to the public. In addition, campuses are required to keep open crime logs that are available for public review within two days following an incident.

Collegiate licensing model codes

In recent years, congressional attention has been directed at workplace conditions in factories used by U.S. manufacturers abroad. In response to congressional pressure and public concern, several organizations initiated efforts to create model workplace codes for manufacturers of apparel and footwear. To date, at least three model codes have been developed. President Clinton initiated the Apparel Industry Partnership (AIP) agreement. Another, developed by the manufacturing industry, is called the Responsible Apparel Principles (RAP). The Collegiate Licensing Company (CLC) also released a model workplace code. Supporters of the respective workplace codes are aggressively recruiting organizations including the NCAA and colleges and universities to endorse their approach.

Rep. George Miller, D-California, sponsored a congressional resolution urging colleges and universities to adopt voluntary codes of conduct governing the manufacturing of licensed apparel. The resolution was ultimately incorporated into the Higher Education Act Amendments of 1998 (P.L. 105-244, House Report 105-750).

Gambling-related issues

In 1997, Congress appointed members of the National Gambling Impact Study Commission to examine the effects of gambling on American society. In November 1998, the NCAA provided testimony at a commission meeting on the impact of sports gambling among college students. The commission's report is expected to address some aspects of collegiate sports gambling when it is released in June 1999.

On March 4, 1998, the U.S. Attorney for the Southern District of New York announced that the owners and managers of six Internet sports gambling companies were charged with conspiracy to use a wire communication facility to accept wagers on sporting events. The charges marked the first major federal action against offshore businesses that conduct gambling over the Internet. Later, seven more operators were charged.

In July 1998, the U.S. Senate passed an amendment, by a vote of 90-10, to prohibit gambling over the Internet. The provision was added to a larger appropriations bill, S. 2260. The U.S. House of Representatives Judiciary Subcommittee on Crime adopted a similar proposal (H.R. 4427). However, the House proposal did not reach the floor of the House for consideration before the conclusion of the 105th Congress. The effort is expected to be renewed in the 106th Congress.

Gender-equity issues

Brown University appealed to the Supreme Court a federal court of appeals ruling that found the institution to be in violation of Title IX. The Supreme Court announced in April 1997 that it would not hear the case, allowing the lower court ruling to stand. Several higher education associations and members of congress supported Brown's appeal. Subsequently, Brown presented a plan to comply with the law that was approved by the court on June 23, 1998.

On October 31, 1997, the EEOC released guidance to the public related to college and university coaches pay discrimination issues. The report specifically addressed compliance with the Equal Pay Act and Title VII of the Civil Right Act. The EEOC stated in the report that they would be more aggressive in monitoring compliance with these laws on campuses.

In June 1997, the National Women's Law Center filed a complaint with the U.S. Department of Education Office for Civil Rights (OCR) against 25 Division I institutions alleging inequities in participation rates and scholarship dollars awarded to men and women. As a result, the U.S. Department of Education began a more aggressive enforcement of proportionality of scholarship awards dollars awarded to men and women athletes. Eventually, several of the complaints were dismissed; others resulted in the department entering into agreements with the institutions to remedy the gender imbalances in their athletics programs.

On April 3, 1998, the U.S. District Court for the Northern District of New York dismissed a Title IX lawsuit brought by eight female students against Syracuse University. The court found that the university had adequately accommodated the athletics interests and abilities of its student-athletes.

In June 1998, the U.S. Department of Justice asked 650 public colleges and universities to supply copies of their institutions' 1997 Equity in Athletics Disclosure Act (EADA) forms to assess compliance with Title VII of the Civil Rights Act governing gender discrepancies in pay. The Justice Department stated that the request was a preliminary fact gathering exercise to examine coach's pay and institutional hiring practices. If evidence of discrimination is found, a formal investigation will be initiated.

On July 23, 1998, the U.S. Department of Education's Office for Civil Rights released a letter stating that spending on men's and women's athletics scholarships should be within 1 percent or less of the total participation rates of each sex in campus athletics programs, or within one scholarship. Prior to the letter, a 5 percent variation was considered acceptable.

The U.S. Supreme Court announced that it would hear the Smith v. NCAA case that will determine whether Title IX applies to the NCAA on January 20, 1999. The court will consider the question of whether the NCAA, through the receipt of dues from its member colleges and universities, is a recipient of federal funds. The NCAA appealed a Third Circuit Court of Appeals ruling that determined that Title IX applied to the NCAA because of the dues paid by its members, most of which are recipients of federal funds.

Higher education issues

On January 21, 1998, the National Commission on the Cost of Higher Education released a report to Congress examining factors impacting the rise in college costs. The commission made recommendations on federal and non-federal actions that could be taken to curb future increases. The report warned postsecondary institutions of "an erosion of public trust" and called on college and university leaders to tackle their institutional costs to make higher education more affordable.

The 105th Congress provided funding to increase the maximum Pell Grant by $425 per student to a current maximum level of $3,125.

The Higher Education Act amendments of 1998 (Conference report 105-750, P.L. 105-244) were signed into law October 7, 1998, extending the Act for five more years. Adopted as part of the legislation are NCAA proposed recommendations to make minor technical changes in the Student Right-to-Know Act, Equity in Athletics Disclosure Act and athletics revenues and expenses reporting. The NCAA proposals were designed to streamline the reporting process for NCAA member institutions and make the information more readily available to consumers. Other provisions of the legislation include: a General Accounting Office study of sports team participation; a requirement that co-educational colleges and universities must provide the U.S. Department of Education with a copy of the institution's Equity in Athletics Disclosure Act (EADA) form to be posted on the Internet by the U.S. Department of Education within 120 days; a requirement that the U.S. Department of Education identify gender-equity trends and report aggregate data obtained from the EADA reports broken down by divisions of the NCAA; an increase in the Pell Grant maximum over the next five years to $5,800; a provision encouraging colleges and universities to adopt policies regarding under-aged and binge drinking of alcoholic beverages on campus; a provision encouraging colleges and universities to adopt voluntary codes of conduct governing the manufacturing of licensed apparel; changes in the Family Educational Rights Privacy Act to allow disclosure of certain student records for law enforcement purposes.

In 1998, provisions to restrict institutional flexibility related to sports team discontinuation were adopted in both the House and Senate Committees with jurisdiction over higher education. However, the language was subsequently removed in floor action. A provision sponsored by Rep. Dennis J. Hastert, R-Illinois, to require institutions to provide four years advance notice of any change that may occur in their athletics program was defeated by a vote of 292 to 129 on the House floor. A similar provision sponsored by Sen. Dan Coats, R-Indiana, was removed from Senate legislation on the Senate floor. In addition, an amendment proposed by Sen. Paul Wellstone, D-Minnesota, to require institutions to establish an internal appeals process by which student-athletes could overturn a campus decision to discontinue a sports team was not offered after strong opposition surfaced from postsecondary institutions.

The U.S. Department of Education granted waivers to the NCAA in 1997 and 1998 related to federal Student Right-to-Know Act reporting requirements. The waivers allowed the NCAA to compile and report graduation-rate data on behalf of its member institutions and make that data available to high schools to satisfy that requirement of the Act.

National Youth Sports Program (NYSP)

In September 1998, the federal law governing the NYSP was extended for five years. Changes to the act include new requirements that each NYSP site establish a community advisory committee and enter into partnerships with local community organizations to carry the benefits of the NYSP throughout the year.

Federal funding for the NYSP increased $1 million each of the two past years to the current level of $15 million in fiscal year 1999.

In the spring of 1998, the NYSP entered into a partnership with the Department of Housing and Urban Development (HUD) to include more students from publicly assisted housing projects in NYSP summer programs. HUD agreed to provide $250,000 in transportation grants.

Also in the spring of 1998, the NYSP entered into a partnership with the Office of National Drug Policy to build upon existing NYSP drug education programs.

Privacy issues related to student records

In December of 1998, the Maryland Court of Appeals upheld a lower court ruling that determined the University of Maryland, College Park, must disclose information related to a student-athlete's parking tickets and subsequent NCAA suspension. The university had withheld the records on the grounds that they were educational records and protected under the Family Educational Rights and Privacy Act (FERPA). The lower court ruling to allow the release of student records from a campus disciplinary proceeding was challenged by the U.S. Department of Education. The NCAA and several other higher education associations filed amicus curiae briefs on behalf of the university, opposing the release of the records.

The Higher Education Act Amendments of 1998 (P.L. 105-244, House Report 105-750) include provisions to allow institutions and third parties to disclose information included in a student's education record to certain parties for "law enforcement purposes." In addition, the new legislation clarifies that educational institutions may publicly disclose the results of any disciplinary action taken against a student who is an alleged perpetrator of a violent crime or non-forcible sexual offense.

In 1998, a former University of Arizona basketball player filed a $1 million lawsuit against the University of Arizona and the Kansas City Star over a 1997 newspaper article in which the student's grades and grade-point average were discussed. The student alleged that his rights under the Family Educational Records Privacy Act (FERPA) were violated by the report.

On February 17, 1998, the North Carolina Court of Appeals upheld a lower court ruling that student disciplinary hearings could be closed to the public and a school newspaper could be barred from reporting the proceedings of the student court.

In 1997, the U.S. Supreme Court refused to hear a case involving the release of campus disciplinary records at Miami University (Ohio). Miami had appealed an Ohio Supreme Court ruling that required the release of disciplinary records to the student newspaper. In response, the U.S. Department of Education filed a request for an injunction in Federal District Court to prevent the release of the disciplinary records with the names of the students intact. The department claimed that revealing the names violated the Family Educational Rights Privacy Act. Similar cases were decided in Missouri and Georgia.

Tax-related issues

In 1997, NCAA-supported provisions on the tax treatment of corporate sponsorship payments to tax-exempt organizations become law as part of sweeping tax legislation (P.L. 105-34, House Report 105-318). The new provisions clarify the distinction between corporate sponsorship payments, not subject to unrelated business income tax (UBIT), and advertising which is considered taxable income. The legislation also removes the "tainting rule" to allow tax-exempt organizations to provide advertising benefits as part of a corporate sponsorship package while only paying UBIT on the value of the advertising benefit.

In 1997, the IRS issued a ruling stating that revenues earned by universities from the use of their golf courses by alumni and major donors triggers unrelated business income tax.

Over the past two years, the IRS increased nonresident alien tax withholding compliance efforts with at least 50 audits currently ongoing on college campuses and over 250 IRS agents trained in this area.

Telecommunication issues

In 1997, the NCAA provided comments on proposed closed captioning regulations issued by the Federal Communications Commission (FCC). The NCAA expressed concern over the cost impact of providing closed captioning on certain broadcasts of local and regional collegiate sports programming. Final regulations were issued; however, no class exemptions were provided for regional and most local college sports broadcasts. Nearly all sports programming will be required to carry closed captioning by 2005.

On October 19, 1998 the Joint Sports Claimants (comprising of the NCAA, Major League Baseball, National Basketball Association and National Hockey League) filed comments regarding the existence of controversies pertaining to the distribution of cable royalty payments for 1996 with the U.S. copyright office concerning 1996 cable royalty fund payments. The NCAA receives a percentage of the royalty pool derived from the payments. The comments begin the process leading to the Copyright Arbitration Royalty Panel approving the distribution of funds.

A significant satellite royalty payment increase, recommended by the Copyright Arbitration Royalty Panel and confirmed by the Librarian of Congress, went into effect on July 1, 1998 without interruption. The U.S. House of Representatives had passed a measure (H.R. 2921) that would have delayed, until December 31, 1999, the increase in the copyright royalty rate paid by satellite companies for the retransmission of distant network and superstation signals, including sports programming. However, the U.S. Senate did not pass the companion bill; thus the effort to freeze the rate was not enacted. The NCAA, on behalf of its members, receives a percentage of the satellite royalties for the retransmission of certain collegiate sports programming. The NCAA distributes the funds to member institutions with qualifying broadcasts.

On June 26, 1998, the U.S. Court of Appeals for the District of Columbia Circuit affirmed the decision of the Librarian of Congress in the Phase I allocation of the 1990-1992 cable royalty fund. This distribution will likely result in an end to the dispute over the royalties paid to various parties over the distribution of the funds for this period.

Sen. Byron Dorgan, D-South Dakota, asked the General Accounting Office (GAO) to conduct a study of the impact of sports programming on the rise in cable rates to consumers. The GAO report is expected to be released in the spring of 1999.

In 1998, a Copyright Arbitration Royalty Panel began proceedings to determine the allocation of satellite royalty payments for the years 1992-95. This is the first proceeding to consider the allocation of satellite royalties for this period.