Conference Asks: Should Big-Time College Athletics be a Tax-Exempt Enterprise?

September 17, 2009

For many colleges and universities, athletics revenues surge as reliably as crowd noise on rivalry weekend, with many universities bringing in millions of dollars from a single football game. Taxation of collegiate athletics revenues will be the subject of a panel discussion at Penn State University, the Dickinson School of Law on Friday, September 18.

Panelists include James E. Delany, commissioner of the Big Ten; John D. Colombo, Albert E. Jenner Jr. Professor of Law of the University of Illinois; and Timothy Curley, director of Athletics at Penn State. The discussion will be moderated by Stephen Ross, professor of law and director of the Penn State Institute for Sports Law, Policy and Research, and sports ethicist R. Scott Kretchmar, a professor of kinesiology at Penn State who serves as the University’s faculty representative to the NCAA.

“The conference will be an excellent opportunity to review some facts and common criticisms about big-time sports,” Ross said.

“The industry experts, Delany and Curley, can provide important commentary on whether it is possible to draw distinctions between millions spent for a new coach who ends up attracting even more revenue to the school—perhaps like Alabama's Nick Saban—and schools that drown in red ink from money-losing football programs that may actually hurt the school's operations.”

The federal tax code exempts from federal income taxation funds earned in the pursuit of a nonprofit organization’s purpose, i.e. the activity that garners the organization its 501(c)(3) nonprofit status. In the context of college sports, the athletic contest is an educational activity.

The conference is organized by the Penn State’s Institute for Sports Law, Policy and Research and Department of Kinesiology and co-sponsored by Penn State’s Center for Sports Business and Research, Penn State’s John Curley Center for Sports Journalism, and the Department of Intercollegiate Athletics.

The public is welcome to the event, which begins at 1:30 p.m. in room 114 of the Lewis Katz Building, located off of Park Avenue and Bigler Road on Penn State’s University Park campus. The conference will be webcast live from www.law.psu.edu and simulcast to the law school’s facilities in Carlisle, Pennsylvania.

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Editors: For additional information, please contact the College of Health and Human Development Office of College Relations at 814-865-3831 or healthhd@psu.edu.