Greg: Lee Roberts, UNC Staying on Offense with House Settlement Implications

CHAPEL HILL, N.C. — It’s been less than seven weeks since the House settlement took effect on July 1, a paradigm-shifting restructuring of NCAA bylaws and procedures that allows for direct revenue sharing between institutions and their student-athletes for the first time in the history of intercollegiate athletics.

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While name, image and likeness legislation in 2021 was abrupt and poorly rolled out, North Carolina and its peer power conference schools have been building out their infrastructure to manage the new era of college sports for the better part of a year. The magnitude of such preparations has been substantial.

“It’s as big a change in the structure of college sports as anybody has ever seen,” UNC chancellor Lee Roberts told Inside Carolina in a recent interview. “We are doing our best to stay on offense and make sure that we are adapting as effectively as possible. We’re fortunate that we have so many terrific supporters of Tar Heel athletics, so many alums and boosters who want to support our teams across the board. That’s made a huge difference to our ability to stay competitive. And we’re going to fully fund the revenue share, as I think most schools in our conference and all of the schools with whom we compare ourselves are also planning to do.”

UNC will be permitted to share $20.5 million with its student-athletes for the 2025-26 fiscal year. The spending limit is determined by a Benefits Pool formula that provides student-athletes with 22.5% of the average power conference school’s revenue and is projected to increase by 4-5% each year for the length of the 10-year deal.

While there is a set allocation split between sports for the $2.8 billion in retroactive payments for former student-athletes that was a primary element of the House settlement, it is up to the individual institutions and their athletic departments to determine how to split the revenue sharing monies. UNC football coach Bill Belichick’s contract term sheet indicated that his program would receive $13 million of the $20.5 million rev share pot. Men’s basketball is expected to receive the large majority of the remaining $7.5 million, according to sources.

NIL deals are still in place, albeit with Deloitte overseeing a third-party clearinghouse (NIL Go) that Deloitte intended to legitimize the process with commercial contracts while eliminating booster workarounds to pay student-athletes. The settlement requires NIL deals greater than $600 to be submitted to NIL Go to determine appropriate compensation ranges.

The $20.5 million in revenue sharing costs, in addition to an increased financial commitment throughout the athletic department, has forced an emphasis on revenue generation to meet the elevated expense requirements on tap. Rick Barakat was hired as the athletic department’s chief revenue officer in March, while NASCAR executive Steve Newmark, who possesses a long and established track record in sponsorships, marketing and contract negotiations, was tabbed to transition into the athletic director role next summer. Current athletic director Bubba Cunningham acknowledged in May that UNC had previously been conservative on advertising, naming rights and promo signage in different venues, but that has changed as another expense category has been added to the budget.

“I think it’s fair to say that we haven’t needed to drive revenue as aggressively in the past as we clearly do now,” Roberts said, “and again, that’s true for not just Carolina, but for everybody we compare ourselves to. When you watch a college football or basketball game, you’ll see more of it this year. There’s clearly been more aggressive use of sponsorship and marketing opportunities, and I think you’re going to see that continue. Everybody’s trying to figure out how to drive revenue.”

With revenue sharing set to funnel primarily to football and men’s basketball, the Rams Club, which is the fundraising arm of Carolina athletics, has increased its efforts to financially secure the 26 non-revenue sports at UNC by way of sport-specific endowments and a massive increase in scholarship expenditures. The House settlement replaced scholarship limits with roster limits, which is projected to reduce UNC’s total count of student-athletes from approximately 850 to 735 after a transition period that allows for current student-athletes to be grandfathered in.

In 2024-25, UNC offered full or partial scholarships to 530 student-athletes, with the total dollar value maxing out at the equivalent of 330 full scholarships. That is set to change dramatically, as Roberts said that UNC intends to fully fund the now-735 total scholarship pool as part of the school’s mission to stay as competitive as possible.

“There’s nothing else like winning a national championship and we’ve done as good a job as anybody, particularly when it comes to women’s sports and the non-revenue sports,” Roberts said. “So we’re going to continue to invest in them and support them.”

In May, Cunningham expressed confusion about how scholarship limits even made it into the House settlement, suggesting that the artificial cap may be eliminated within two-to-three years’ time. Roberts didn’t disagree.

“I think it’s clear to say that the House settlement is not the end of the changes in college athletics,” Roberts said. “The premise of the House settlement was that it would dry up the third-party collectives and that it would forestall future litigation. The House settlement has been in effect [since July 1], and that’s already proven not to be true. It does have the benefit of preventing an adverse judgment against the conferences and the NCAA, which would have bankrupted them. And it makes sense for that reason, but I don’t know of anybody who is satisfied with the status quo in college athletics as enshrined in the House settlement. You’ve seen a lot of discussion about a legislative solution. The President put out an executive order [in July] that was constructive, but I think the conferences and the NCAA and individual schools are going to continue to press for more rationalization of the college athletics landscape from Congress.”

While the eventual end game of this new era of collegiate athletics remains a moving target, UNC is determined to stay competitive on the field of play by elevating its financial commitment in supporting its athletic department.