Beginning July 1, LSU and other major athletic programs nationwide will begin paying athletes on top of their scholarships as college sports turns into a more professional model rather than one long defined by amateurism.
Players still can earn additional money through third-party name, image and likeness deals. But with a new clearinghouse managed by Deloitte set to begin, the settlement aims to limit pay-for-play activity by the booster collectives that funded rosters for the past four years.
It is a monumental shift in college sports, one that LSU has prepared for for nearly a year. Here’s what we know so far about the Tigers’ plans for this system.For the first time, schools will be allowed to pay their athletes directly after a multibillion-dollar legal settlement was approved Friday night, ushering in a new era of college sports.
The House settlement, an agreement in three federal antitrust lawsuits against the NCAA and the four power conferences, was approved by Judge Claudia Wilken, letting schools pay players and creating an enforcement entity for the new system.How does the salary cap work?
Any school that opted into the settlement is allowed to pay an estimated maximum of $20.5 million during the 2025-26 academic year. That cap is expected to increase annually over the course of the 10-year settlement agreement because of rising revenues.
Each school can distribute the money as it sees fit, creating decisions about how to spread funds among multiple sports and players.
Similar to others in the SEC, LSU athletic director Scott Woodward told The Advocate in a recent interview that the Tigers would “roughly” follow the formula the settlement used to pay back $2.8 billion in damages to former players who could not profit off their NIL.
That means LSU plans to allocate 75% to football, 15% to men’s basketball, 5% to women’s basketball and 5% to the rest of its sports, including baseball and gymnastics. Up to $2.5 million in new scholarships will count against the cap.“I don’t see it changing drastically from there as far as revenue share goes,” Woodward said.
LSU football now has $13.5 million to spend in the upcoming academic year. Some of the money already was earmarked for players on the 2025 roster. Brian Kelly has said LSU reserved an unspecified amount for the 2026 team because payments operate on the academic calendar.
After paying football and basketball players, it’s unclear how LSU will divide the remaining 5% among the rest of its sports. Athletes will be under contract, though they are not yet considered employees.
Instead of using the NCAA, the power conferences created a new enforcement organization, the College Sports Commission, to monitor the legitimacy of the payments and make sure schools stay under the cap. The commission will be run by Bryan Seeley, a former MLB executive.What happens to NIL deals?
The other major result of the settlement was an attempt to regulate NIL payments by school-affiliated donor collectives, which funded rosters in the NIL era. The success of the salary cap hinges on restricting pay-for-play activity.
Every third-party NIL deal of more than $600 will have to go through the clearinghouse’s online platform, NIL Go, which launches June 11. According to the commission’s website, deals will be judged on whether or not they serve a “valid business purpose and do not exceed a reasonable range of compensation.”
If the deal is not cleared, players can revise the contract, cancel it or appeal the decision through an arbitration process. The commission’s website noted “if the student-athlete continues with the deal as submitted, they may face enforcement consequences, which could include loss of eligibility.”
