College football labor decision may hurt schools, Moody’s says

Stefanie Botelho's picture
Friday, March 28, 2014

A ruling yesterday by the National Labor Relations Board allowing Northwestern University football players to unionize is the latest threat to the model of not paying athletes in college sports, Moody’s analysts led by Dennis Gephardt said today in a report. A change in the practice “would ultimately precipitate a major retooling of college sports programs, which are often critical to the identity of universities and help with student recruitment and donor support,” Gephardt said.

The NCAA is facing separate lawsuits challenging its authority and faces the potential of higher costs from legal judgments and settlements, regulations or new policies, Moody’s said. In June, the ratings company changed the outlook of the Indianapolis-based association’s debt to negative because of the increased risks. NCAA debt is ranked Aa2, the third-highest investment grade.

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