Kentucky Looking to Turn It’s Athletic Department into a LLC

[BamaBoySince89]

Don’t know if this is a smart move or a knee-jerk reaction to the looming House settlement coming up.

Personally, I think it may help but don’t know much of what goes into benefiting AD’s by becoming a LLC

Link

 

[BamaSC]

I brought this up a while ago, that I thought athletic departments would be split off into their own corporations. It may be a way to have athletes as employees without them being state employees. Maybe it shields the university from lawsuits? As a corporation, they could sell stock to raise money. As for UK forming a LLC, maybe it’s a baby step in that direction? IDK, but it’s interesting.

 

[Redwood Forrest]

I am just wondering if the fans can cobble together some sort of collective. Do the fans have any rights? After all, fans pay their money to sit and watch. Seriously, dues paying fans ought to have some input into all this power grabbing.
Maybe ticket buying fans could send a player packing to the portal.

 

[4Q Basket Case]

I brought this up a while ago, that I thought athletic departments would be split off into their own corporations. It may be a way to have athletes as employees without them being state employees. Maybe it shields the university from lawsuits? As a corporation, they could sell stock to raise money. As for UK forming a LLC, maybe it’s a baby step in that direction? IDK, but it’s interesting.

Interesting point about being able to make players employees of the AD, but not the university itself. I don't know if that would survive the inevitable court challenge, but it might. That could be a function of the legal relationship between the University and the LLC. I know enough about it to ask some questions, but the answers are way beyond my legal familiarity.

It could also be the first step toward a business model that makes it a lot easier to get to a CBA, which I think is the only realistic way out of the chaos we currently have.

Regarding selling stock, that's true and a scary thought. Then you'd have boosters and fans with a legal, not just influential, say-so over all operations of the Athletic Department.

Would top-flight ADs view reporting to a Board of Directors, elected by the boosters / fans / shareholders, as preferable to reporting to a College President and Board of Trustees? I don't know.

Also, if LLC law permits it, I'd expect multiple classes of stock, each carrying different voting rights. To paraphrase George Orwell, that would make some shareholders (presumably ones with a larger stake, e.g., Phil Knight, Jimmy Haslam, etc.) more equal than others.

IOW, an LLC could solve some problems and create others. Whether that tradeoff is beneficial on a net basis, I don't know. But we may be about to find out.

Late Question: If the LLC is a separate entity from the university, and the players are employees of the LLC, do the players even have to be students? As I think about it, if the answer is no, this might be the major goal of the LLC?

 

[lowend]

Late Question: If the LLC is a separate entity from the university, and the players are employees of the LLC, do the players even have to be students? As I think about it, if the answer is no, this might be the major goal of the LLC?

And how would all that work at schools where the AD is significantly funded by "student activity fees?" I feel like the LLC/subsidiary corp route would only apply for a few universities.

 

[4Q Basket Case]

And how would all that work at schools where the AD is significantly funded by "student activity fees?" I feel like the LLC/subsidiary corp route would only apply for a few universities.

Fair question. You'd have to know what percentage of Athletic Department revenue, for which schools, comes from student fees (as opposed to ticket sales, TV rights and in-arena ad sales, licensing fees, etc.). It would clearly work for some.

The real question might be whether it would it work for the right ones -- the schools whose athletic programs could actually drive nationwide change.

What percentage of the P4, or even just the B1G and SEC, would it work for? I don't know. But to repeat myself, we may be about to find out.

 

[AlexanderFan]

Interesting point about being able to make players employees of the AD, but not the university itself. I don't know if that would survive the inevitable court challenge, but it might. That could be a function of the legal relationship between the University and the LLC. I know enough about it to ask some questions, but the answers are way beyond my legal familiarity.

It could also be the first step toward a business model that makes it a lot easier to get to a CBA, which I think is the only realistic way out of the chaos we currently have.

Regarding selling stock, that's true and a scary thought. Then you'd have boosters and fans with a legal, not just influential, say-so over all operations of the Athletic Department.

Would top-flight ADs view reporting to a Board of Directors, elected by the boosters / fans / shareholders, as preferable to reporting to a College President and Board of Trustees? I don't know.

Also, if LLC law permits it, I'd expect multiple classes of stock, each carrying different voting rights. To paraphrase George Orwell, that would make some shareholders (presumably ones with a larger stake, e.g., Phil Knight, Jimmy Haslam, etc.) more equal than others.

IOW, an LLC could solve some problems and create others. Whether that tradeoff is beneficial on a net basis, I don't know. But we may be about to find out.

Late Question: If the LLC is a separate entity from the university, and the players are employees of the LLC, do the players even have to be students? As I think about it, if the answer is no, this might be the major goal of the LLC.

Huepel might feel right at home reporting to these two:

 

[Tideflyer]

I brought this up a while ago, that I thought athletic departments would be split off into their own corporations. It may be a way to have athletes as employees without them being state employees. Maybe it shields the university from lawsuits? As a corporation, they could sell stock to raise money. As for UK forming a LLC, maybe it’s a baby step in that direction? IDK, but it’s interesting.

Not that it already hasn’t occurred to a great extent, but does this sort of thing completely and formally divorce “ college “ athletics, particularly football, from any sort of academic expectations/ requirements?

 

[BamaSC]

Not that it already hasn’t occurred to a great extent, but does this sort of thing completely and formally divorce “ college “ athletics, particularly football, from any sort of academic expectations/ requirements?

I think that’s the intent, but don’t know for sure.

 

[mrusso]

So what's the relationship between the LLC and the university? What's the tie-in? Could the LLC align with any university?

 

[colbysullivan]

And how would all that work at schools where the AD is significantly funded by "student activity fees?"

Well, see…that’s the fun part. It won’t.

 

[Tideflyer]

I wonder how all this will play out with the Notre Dames, Stanfords and Vanderbilts of the world?

 

[bamamc1]

Huepel might feel right at home reporting to these two:
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You gotta love Junior Samples Jr.