The NCAA News Digest

June 2, 1997

• FEDERAL LEGISLATION -- Congress to consider tax issues that could affect college athletics
• FOOTBALL -- Senate subcommittee hears testimony about bowl alliance
• INTERNET -- New NCAA web site offers College World Series coverage

FEDERAL LEGISLATION

Congress to consider tax issues that could affect college athletics

Rep. Dave Camp, R-Michigan, has introduced legislation, H.R. 1279, that would exclude certain corporate sponsorship payments from unrelated business income.

Under current proposed IRS regulations, all corporate sponsorship payments are subject to unrelated business income tax (UBIT) if any of the benefits afforded the sponsor amount to advertising. H.R. 1279 would distinguish between payments made in exchange for advertising from all others. Under Camp's legislation, "qualified sponsorship payments" in which the participating sponsor receives no substantial return benefit other than the use or acknowledgment of the donor's name or logo would be excluded from UBIT.

Only the value of those benefits that provide advertising for the sponsor's products or services (including messages containing qualitative or comparative language, price information or other indications of savings or value, an endorsement, or an inducement to purchase, sell or use such products or services) would be subject to UBIT.

Congress twice before has passed tax bills that contained similar corporate sponsorship language only to have the legislation vetoed by Presidents Bush and Clinton over concerns over several larger, unrelated tax provisions. In light of the recent balanced budget agreement negotiated by congressional leaders and the Clinton Administration, there is optimism that a tax bill will be signed into law sometime this year.

NCAA Executive Director Cedric W. Dempsey plans to send a letter to members of the House Ways and Means Committee encouraging them to include the language from H.R. 1279. In addition, a letter will also be sent to members of the Senate Finance Committee urging them to support identical corporate sponsorship language proposed by Sen. Don Nickles, R-Oklahoma.

Doris A. Dixon, NCAA director of federal relations, said that NCAA members may also wish to contact the committees.

Both committees are expected to finish drafting their bills by mid-June.

Staff contact: Doris A. Dixon.

FOOTBALL

The Senate Subcommittee on Antitrust, Business Rights and Competition convened a hearing May 22 in Washington, D.C., to provide a forum in which parties involved in the football bowl alliance dispute could state their positions and hear the positions of others.

Testimony came from student-athletes, coaches, conference commissioners from alliance members and nonmembers, a representative of a nonalliance bowl and the NCAA, among others.

Staff contact: Doris A. Dixon.

INTERNET

A new College World Series Web Site will offer detailed coverage of the Division I Baseball Championship for those with access to the Internet.

The official College World Series address is www.ncaabaseball.com. It is accessible through links posted on NCAA Online (www.ncaa.org).

The site provides travel and ticket information, team information, interactive games, a review of the 1996 championship, a live scoreboard, and stories from multiple outlets.

Staff contact: Wallace I Renfro.