Penn State Enters House Settlement Era in 'Position of Strength,' AD Says

Since 2024, Penn State Athletic Director Pat Kraft has said the Nittany Lions are prepared for the next generation of college sports. After the House Settlement was approved Friday night, paving the way for schools to share revenue directly with athletes, Kraft said that next year for Penn State sports looks "to be one of the best in our history..."

U.S. District Court Judge Claudia Wilken published her ruling in the House vs. NCAA antitrust case that fundamentally alters the framework of college athletics. Beginning July 1, college athletic departments can pay players directly through revenue sharing. According to the ruling, schools can pay athletes up to $20.5 million annually for the 2025-26 school year. Power 5 conference schools must opt in to be eligible to pay athletes.

The ruling also raises scholarship limits for most sports, including 105 players in football. A new College Sports Commission will oversee the revenue-sharing cap and enforce rules related to it.

In a letter published on the Penn State athletics website, Kraft said that the school has been preparing for the settlement for a year. Penn State plans to fund revenue-sharing payments to the $20.5 million cap, though how it will disburse that money remains unknown. Most projections have schools targeting 70-80 percent of the total to football, 10-15 percent to the basketball programs and 5-10 percent to Olympic sports.

"Since the Court’s initial approval of the settlement in July 2024, Penn State Athletics has been preparing to meet the demands of this transformational change," Kraft said in the letter. "We will share revenue with our student-athletes to the maximum allowable levels; through the new Legacy Fund and the existing Nittany Lion Club Excellence Funds; we will increase the number of scholarships we offer to our 800+ student-athletes, as the settlement removes NCAA scholarship limits; and we have developed ROAR Solutions, a powerful, dynamic group of resources assembled to deliver the best student-athlete NIL, endorsement and branding support in the country."

According to its most recent financial report, Penn State Athletics generated a $5.65 million surplus in the 2023-24 fiscal year. The department reported just under $220.8 million in revenue and $215.1 million in expenses. The new $20.5 revenue-sharing cap represents about 9.5 percent of Penn State's 2023-24 athletic budget.

Here is Kraft's full letter released Saturday regarding the House vs. NCAA settlement:

Last night, United States Federal District Court Judge Claudia Wilken gave final approval of the House vs. NCAA settlement. This historic settlement signals a new era for college sports and changes the landscape in several significant ways. The key aspects of the settlement include the elimination of NCAA scholarship limits and establishes roster limits for each team; establishes a groundbreaking revenue-sharing framework that allows institutions to share revenue with
student-athletes; and institutes a back damages payment plan for former student-athletes from the last 10 years for the use of their name, image, and likeness (NIL).

The College Sports Commission (CSC), which will operate separately from the NCAA, has been
established to ensure enforcement and compliance with the new rules surrounding roster limits, revenue sharing and student-athlete third-party NIL deals. The CSC named Bryan Seeley, who
has a distinguished career in professional sports and public service, as its first Chief Executive Officer. For more information on the CSC and the new era of college athletics, visit collegesportscommission.org.

Since the Court’s initial approval of the settlement in July 2024, Penn State Athletics has been preparing to meet the demands of this transformational change. We will share revenue with our student-athletes to the maximum allowable levels; through the new Legacy Fund and the existing Nittany Lion Club Excellence Funds, we will increase the number of scholarships we offer to our 800+ student-athletes, as the settlement removes NCAA scholarship limits; and we have developed ROAR Solutions, a powerful, dynamic group of resources assembled to deliver the best student-athlete NIL, endorsement and branding support in the country.

While the world around us changes, our steadfast focus on supporting student-athletes and winning championships remains constant! We had a terrific 2024-25 academic and athletic year, and next year looks to be one of the best in our history, and because of those successes, Penn State enters this new era of college sports in a position of strength and ready to attack this new collegiate landscape. While change can be difficult, it also can provide new opportunities, and I assure you we will embrace every opportunity this new model creates. We will continue to lean into our tradition of excellence to shine academically, emphasize the impact of a Penn State degree and alumni network, and pursue excellence in competition. Now, more than ever, we must rally together to ensure our student-athletes thrive and our legacy endures.