Louisiana is poised to hike taxes on sports betting to pump more than $24 million into athletic departments at the state’s most prominent public universities.

Legislation pending before Gov. Jeff Landry would make Louisiana the first state to raise taxes to fund college sports since a judge approved a landmark settlement with the NCAA allowing schools to directly pay athletes for use of their name, image and likeness (NIL). Anticipating the court’s approval, Arkansas this year became the first to waive state income taxes on NIL payments made to athletes by higher education institutions.

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More states seem almost certain to adopt their own creative ways to gain an edge — or at least keep pace — in the rapidly evolving and highly competitive field of college sports.

“These bills, and the inevitable ones that will follow, are intended to make states ’college-athlete friendly,’” said David Carter, founder of the Sports Business Group consultancy and an adjunct professor at the University of Southern California. But “they will no doubt continue to stoke the debate about the `perceived’ preferential treatment afforded athletes.”

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The new NCCA rules allowing direct payments to college athletes kick in July 1. In the first year, each Division I school can share up to $20.5 million with its athletes — a figure that may be easier to meet for big-time programs than for smaller schools weighing whether to divert money from other purposes. The settlement also continues to allow college athletes to receive NIL money from third parties, such as donor-backed collectives that support specific schools.

Louisiana bill sponsor: `We love football’

The Louisiana legislation won final approval just two days after a judge approved the antitrust settlement between the NCAA and athletes, but it had been in the works for months. Athletic directors from many of Louisiana’s universities met earlier this year and hashed out a plan with lawmakers to relieve some of their financial pressures by dividing a share of the state’s sports betting tax revenue.

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The biggest question for lawmakers was how large of a tax increase to support. The initial proposal sought to double the state’s 15% tax on net proceeds from online sports betting. But lawmakers ultimately agreed on a 21.5% tax rate in a compromise with the industry.

One-quarter of the tax revenue from online sports wagering — an estimated $24.3 million — would be split equally among 11 public universities in conferences with Division I football programs. The money must be used “for the benefit of student athletes,” including scholarships, insurance, medical coverage, facility enhancements and litigation settlement fees.

The state tax money won’t provide direct NIL payments to athletes. But it could facilitate that indirectly by freeing up other university resources.

The legislation passed overwhelmingly in the final days of Louisiana’s annual session.

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“We love football in Louisiana – that’s the easiest way to say it,” said Republican state Rep. Neil Riser, who sponsored the bill.

Smaller universities are feeling the squeeze

Many colleges and universities across the country have been feeling a financial squeeze, but it’s especially affected the athletic departments of smaller schools.

Athletic departments in the top Division I football conferences take in millions of dollars from media rights, donors, corporate sponsors and ticket sales, with a median of just 7% coming from student fees and institutional and government support, according to the Knight-Newhouse College Athletics Database.

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But the remaining schools in Division I football bowl conferences got a median of 63% of the revenue from such sources last year. And schools without football teams got a median of 81% of their athletic department revenues from institutional and governmental support or student fees.

Riser said Louisiana’s smaller universities, in particular, have been struggling financially and have shifted money from their general funds to their sports programs to try to remain competitive. At the same time, the state has taken in millions of dollars of tax revenue from sports bets made at least partly on college athletics.

“Without the athletes, we wouldn’t have the revenue. I just felt like it’s fairness that we do give something back and, at the same time, help the general funds of the universities,” Riser said.

Other states are investing in college sports

Louisiana would become the second state behind North Carolina to dedicate a portion of its sports wagering revenues to colleges athletics. North Carolina launched online sports wagering last year under a state law earmarking part of an 18% tax on gross gaming revenue to the athletic departments at 13 public universities. The state’s two largest institutions were excluded. But that might be about to change.

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Differing budget plans passed by the state House and Senate this year both would start allotting sports betting tax revenue to the athletic programs at the University of North Carolina at Chapel Hill and North Carolina State University. The Senate version also would double the tax rate. The proposals come a year after University of North Carolina trustees approved an audit of the athletics department after a preliminary budget projected about $100 million of debt in the years ahead.

Other schools also are taking actions because of deficits in their athletic departments. Last week, University of Kentucky trustees approved a $31 million operating loan for the athletics department as it begins making direct NIL payments to athletes. That came after trustees in April voted to convert the Kentucky athletics department into a limited-liability holding company — Champions Blue LLC — to more nimbly navigate the emerging financial pressures.

Given the money involved in college athletics, it’s not surprising that states are starting to provide tax money to athletic departments or — as in Arkansas’ case — tax relief to college athletes, said Patrick Rishe, executive director of the sports business program at Washington University in St. Louis.

“If you can attract better athletes to your schools and your states, then this is more visibility to your states, this is more potential out-of-town economic activity for your state,” Rishe said. “I do think you’re going to see many states pursue this, because you don’t want to be the state that’s left exposed or at a disadvantage.”

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The Arkansas Razorbacks didn’t plan on playing in an elimination game, but that’s where they found themselves in the College World Series after an opening loss. There, starting pitcher Gage Wood had the Razorbacks get on his back, as he went out and pitched the third no-hitter in College World Series history against Murray State to stay alive.

After the game, Wood shared that he wasn’t necessarily feeling any pitcher working better than normal during warmups. Instead, his performance came from simply not wanting to get eliminated just yet.

“Don’t throw a slider,” Gage Wood said. “I throw a curveball. I throw a cutter. But, no, the only special thing was I didn’t want to go home. That’s it.”

For Gage Wood, it was one of the greatest pitching performances in the history of college baseball. He had 19 strikeouts in the no-hitter. The MLB record for strikeouts in a game is 20. Roger Clemens did it twice and Kerry Wood did it once. There are six instances of 19 strikeout games as well. Gage Wood did that while also throwing a no-hitter. In fact, he was one hit by pitch in the eighth inning away from being perfect.

After losing the perfect game, some pitchers may have been pulled with an increasing pitch count. However, Arkansas head coach Dave Van Horn explained why that wasn’t happening in the elimination game.

“I’ll be the first one to say it: There’s nothing being said or talked about our dugout whatsoever. We’re just going to let him roll,” Van Horn said. “There was no chance he was coming out after eight.”

In his career, Wood has received and will likely receive more game balls. Perhaps none will ever be as special as this one, though, and as he explained he gave it to his father to share, saying, “I said, ‘Happy late Father’s Day.’”

Next, Arkansas is set to take on either LSU or UCLA. That game was delayed part of the way through due to weather. If it ends up being LSU, the Razorbacks will be again matched with a team that has already beaten them in Omaha this season.

Gage Wood is widely regarded as a future first round pick. However, after pitching on Monday, it’s going to be a few days before he’s available for Dave Van Horn and Arkansas to use in another College World Series game. Instead, they’ll need to rely on their other arms.

John Calipari, the Hall of Fame coach leading Arkansas, has seen it all in his 34-year career. He has led teams to national championships and Final Fours and raised top-of-the-line players. However, Calipari may have finally hit his limit as college basketball adapts to the significant changes due to Name, Image, and Likeness (NIL) deals and the transfer portal.

John Calipari Has A Passion For Transformation, Not Transactions

During his recent appearance as a guest on The Jim Rome Show, Calipari shared his thoughts about the new age of College Basketball. When asked what drove him to coach teams even at this age, he answered that it all comes from his desire to shape young lives.

“As long as I can keep helping young people and their families, then I’ll do it,” he told Jim Rome. But the rise of NIL and the transfer portal threatens to shift the game from “transformational” to “transactional.” He expressed frustration with a system where players can transfer to multiple schools and 26, 27, or 28-year-olds can compete against teenagers.

He joked, “You can’t have a player look in the stands and wave to his wife and two kids, knowing that the NIL is paying alimony for the first wife.” For Calipari, this transactional environment clashes with his mission to develop players holistically.

His first season at Arkansas, after a 15-year stint at Kentucky, showed he’s still got it. Guiding the Razorbacks to a Sweet 16 appearance despite a 1-6 SEC start, Calipari worked hard for a turnaround, which was seen by an 89-79 upset over Kentucky.

“As rewarding a year as I’ve had in all my years,” he said, reflecting on the 2024-25 season that ended with an overtime loss to Texas Tech. With a five-year, $7 million contract, including a $1 million signing bonus and $500,000 annual retention bonus, Calipari is committed to Fayetteville, but he’s clear: if the game becomes purely transactional, “why would I do it?”

Going Through a New Era in College Basketball

The SEC’s rise as a basketball powerhouse with 14 teams in the 2024 NCAA Tournament, seven in the Sweet 16, owes it all to its increased investment. Calipari noted, “When they went to the TV network and the schools had more money, they invested in men’s basketball and women’s Basketball,” he said.

Last year, the top seven SEC teams retained 95% of their rosters, unlike Calipari’s young Arkansas squad. But with 22 of the league’s top 26 scorers now gone, he admitted, “I have no idea” where the sport is headed.

KEEP READING: Arkansas HC John Calipari Signs Another International Recruit, Reinforces “Grown Men” Mentality

Calipari’s love for coaching is evident, but the transfer portal and NIL’s influence push him to the edge. If the sport’s rules stifle his ability to transform lives, he’s prepared to walk away. Arkansas fans can expect Calipari to keep building, blending young talent with veterans to chase another title. His retirement may not be imminent, but he clarified that impact, not dollar signs, will define his legacy.

Diego Pavia has seen the NIL era of college football grow into what it is today as one of the biggest beneficiaries of it. The Vanderbilt quarterback has an estimated valuation of $1.6 million according to On3, making money that was unimaginable to college athletes only a few years ago.

Even he wasn’t always raking in that kind of cash in the early days of NIL. Pavia began his college career at the JUCO level in 2020, before NIL laws had even been passed. It wasn’t until he arrived at New Mexico State in 2022, one year after the first season of NIL, that he got his first deal.

But, as he explained in an appearance on the Bussin’ with the Boys podcast, that was paltry compared to what he was pulling in now. Despite starting eight of 12 games for the Aggies in the 2022 season, Pavia wasn’t even the highest paid player on his own team.

“First crack in the NIL game I was getting paid $1,400 at New Mexico State per month and I was pissed because Eli Stowers was getting paid $3,000 a month and he played tight end and I played quarterback,” Pavia said. “I’m like, ‘Man, f*** that. I need to go harder.’ It all worked itself out.”

Pavia found his form over the back half of his first season at New Mexico State, setting him up to enter 2023 as the clear starter. He would go on to throw for 2,973 yards and 26 touchdowns to nine interceptions while also rushing for 923 yards and seven scores.

The Aggies finished 10-5 that season and Pavia saw the dividends from his big year in the transfer portal. He was not only being offered a monthly pay that was in the six figures range, but gifts in addition to the payments as well.

“Coming from that $1,400 to these others schools were offering my like a car, houses and big time money. It’s like, ‘Holy sh*t,’” Pavia said. “…I would have stayed at New Mexico State for $100,000. Then at Vandy, the quarterback they just brought in, they paid him way over $100,000 and they offered me $150,000, but I didn’t know that. I’m going from $1,400 to $150,000? I’m like, ‘Sign me up.’ So that’s how I took it last year.”

There was some question of whether Pavia would have any eligibility remaining for 2025 because he had played five seasons already. However, the NCAA ruled to grant a waiver to players that did not count their JUCO seasons against eligibility, opening the door for him to play one more year.

Now he’ll get to continue reaping the benefits of NIL as he looks to lead Vanderbilt to its first ever College Football Playoff appearance. But even with all the money coming in, he has been smart with his finances thanks to his family and resources at the school.

“Vanderbilt does a good job of bringing in ex-players or alumni that are big-time people who work in the business. They come back and tell us about (financial literacy). We have probably 8-9 meetings on it. ..,I give it all to my mom and she handles it. So I’ve never touched a dime of my NIL.”

The college sports offseason is in full effect, as we enter the ‘Mount Rushmore’ time of year. But the business part never stops and with July 1st approaching we’re about to officially begin the era of revenue-sharing in college athletics. And there are key meetings taking place this week with the College Football Playoff committee on future playoff formats.

But, there are plenty of other storylines to follow as we inch closer to the upcoming football season, especially the offers that South Carolina quarterback LaNorris Sellers received this past offseason to potentially transfer. There’s also those buyouts that we keep discussing for athletes in this new era of college athletics following the House settlement. 

There’s a lot going on, and given that my inbox has been filled with questions over the past few days, it’s time to dive into a few subjects that have been the talk of college sports recently.

LaNorris Sellers Offered $8 Million To Transfer During Off-Season?

We have seen plenty of stories over the past few years of athletes being offered a nice paycheck to transfer to an opposing school, with quarterbacks Carson Beck and Darian Mensah snagging nice paydays in the ACC. But, for South Carolina quarterback LaNorris Sellers, an offer of $8 million was not enticing enough to bolt in the offseason. 

According to The Athletic, Sellers had plenty of suitors following the 2024 season, along with after spring practice, but was not biting. 

“He was offered all kinds of crazy numbers,” his father, Norris Sellers told Bruce Feldman. “I told him he could say, ‘I’m gonna stay or I’m gonna go.’ By my two cents: It was to get into college on a scholarship, play ball, get our degree and go on about our business. This NIL deal came later. We didn’t come here to make money. We came here to get our education, play ball. And with schools calling, we’re not gonna jump ship because they’re offering more than what we’re getting. If it ain’t broke, don’t fix it.

“You’re 19. You don’t need ($8 million). You’re in a great spot. There were several talks, but it never really crossed his mind (to leave).”

While Sellers is being taken care of from a financial standpoint in South Carolina, it had to be incredibly hard to see those types of figures and not pull the trigger. But, I still go back to a conversation I had with head coach Shane Beamer a few years ago when LaNorris participated in his first spring practice.

“This kid is going to be special, you just watch. We have big plans for him,” Beamer said on the practice field. 

Obviously, LaNorris did not bite when it came to transferring, but we are clearly seeing schools throw around large figures to poach QBs that they think can help their team move forward. If there is one quarterback in the SEC that I’m excited about watching this upcoming season, and see his progression, it’s LaNorris Sellers at South Carolina. 

Sign me up. 

CFP Meetings Are Being Held This Week. New Format Coming? 

The next round of college football playoff conversations are happening as we speak at the Biltmore Estate in North Carolina. This particular set of meetings was circled on plenty of calendars, given that we are in the middle of some pretty contentious talks around what the playoff format could look like starting in 2026. 

If you weren’t paying attention to SEC meetings a few weeks ago, the talk was clearly centered around strength of schedule, and how plenty of coaches would be for 11 at-large spots, compared to four automatic-qualifiers for the Big Ten and SEC. The problem is that there has been plenty of pushback from the Big Ten side, given that they would prefer the AQ’s over fighting for at-large spots. 

There was a sense of tension between both power conferences as SEC meetings started, with the Big Ten liking the idea of the guaranteed spots, while SEC coaches were lobbying for the best sixteen teams to make the playoff. But, the biggest problem is how the strength of schedule will be measured moving forward, if the CFP committee decides that the 5+11 model can garner enough votes to pass. 

Remember, the SEC and Big Ten are in control over future playoff formats, thanks to that power being given to them by other conferences last year in a vote. But, that doesn’t mean Greg Sankey and Tony Petitti want to just run rough shot on everyone else at the table. If they can come up with a suitable way to work around not having four AQ’s each, they are willing to listen. Well, at least Sankey is right now. 

CFP chair Rich Clark will present a few new ideas this week, which include how the selection committee uses metrics based on strength of schedule, which the SEC has clearly been lobbying for. If the conference doesn’t have to move to a nine-game schedule, and can still have their SOS weighed in the favor they prefer, or can at least live with, I would expect Greg Sankey to put his weight behind this format. 

The problem is that the Big Ten continues to harp on the AQ’s, and it would take a lot of persuasion to pull them away from voting on a 5+11 format, which takes away four guaranteed spots in the postseason. 

I would expect some interesting conversations over the next two days in Asheville, North Carolina. 

Further Buyouts Coming For College Athletes? Not So Fast

Last week, the NCAA and power conferences released a FAQ that centered around different components of the House settlement, with revenue-sharing obviously being the main topic discussed. 

In the 36-page document that was introduced to help guide schools through the next year, at least, there was a section on buyouts for college athletes. In these revenue-sharing contracts that plenty of players have already signed, the document details how schools could put buyout provisions in contracts that will see the school receive some sort of payout for a player deciding to transfer. 

While we have seen buyout clauses put into NIL agreements over the past few years, it’s hard for collectives to recoup that money, though we have seen one case already with former Arkansas QB Madden Iamaleava. 

How would this work? According to the FAQ, if an athlete signs a one-year contract with a school for $100,000, there would also be a $100,000 buyout provision included. In the case of payment, the athlete would receive $50,000 at the start of the deal, and then receive the remaining $50,000 if they stay until the end of the academic calendar. 

Now, if they decide to enter the transfer portal, they will not receive the second $50,000 payment, and then whichever school they transfer to will then pay the previous school $100,000 as a buyout. 

Ok, now imagine how this would play out for a high-profile player with a contract that is substantially more than $100,000. What if the athlete was quietly shown the door, with the team bringing in another player to take their spot? See where I’m going here? There are way too many problems with this buyout proposal, but obviously this is just a starting point. Also, if both sides get hung up 

I think you’re starting to see the picture when it comes to what will start occurring once we get to July 1st, and the House settlement aftermath officially begins. 

We are in the middle on CFP conversations, schools preparing for the start of revenue-sharing, while the financial figures around transfer quarterbacks continue to grow. 

Or, as we call it in this business, just another Tuesday.