The House tax reform bill could cost college athletic programs millions

  • The House just passed the Tax Cuts and Jobs Act, which calls for a number of reforms.
  • The bill would strip ticket-related donations to universities of their tax-deductible status, which could cost athletic departments millions.

The House passed the Tax Cuts and Jobs Act on Thursday, and college athletic administrators across the country are worried that the proposed reforms could have major effects on their programs.

Section 1306 of the bill, which passed 227 to 205, would bring an end to tax deductions on charitable donations related to tickets. Currently, many athletic programs rely on these contributions, which often bring in far more money than the tickets themselves.

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NASHVILLE, TN- SEPTEMBER 10: Safety Karl Joseph #42 of the Oakland Raiders deflects a pass intended for wide receiver Eric Decker #87 of the Tennessee Titans in the first half at Nissan Stadium on September 10, 2017 In Nashville, Tennessee. (Photo by Wesley Hitt/Getty Images) )
FOXBORO, MA - SEPTEMBER 07: Kareem Hunt #27 of the Kansas City Chiefs stiff arms Duron Harmon #30 of the New England Patriots as he runs for a 4-yard rushing touchdown during the fourth quarter against the New England Patriots at Gillette Stadium on September 7, 2017 in Foxboro, Massachusetts. (Photo by Maddie Meyer/Getty Images)
CLEVELAND, OH - SEPTEMBER 10: DeShone Kizer #7 of the Cleveland Browns rushes for a touchdown in the first half against the Pittsburgh Steelers at FirstEnergy Stadium on September 10, 2017 in Cleveland, Ohio. (Photo by Justin K. Aller/Getty Images)
SANTA CLARA, CA - SEPTEMBER 10: Cam Newton #1 of the Carolina Panthers is tackled by Eric Reid #35 of the San Francisco 49ers at Levi's Stadium on September 10, 2017 in Santa Clara, California. (Photo by Ezra Shaw/Getty Images)
MINNEAPOLIS, MN - SEPTEMBER 11: Jerick McKinnon #21 of the Minnesota Vikings carries the ball in the first quarter of the game against the New Orleans Saints on September 11, 2017 at U.S. Bank Stadium in Minneapolis, Minnesota. (Photo by Adam Bettcher/Getty Images)
BALTIMORE, MD - SEPTEMBER 17: Tight end David Njoku #85 of the Cleveland Browns celebrates his touchdown against the Baltimore Ravens in the second quarter at M&T Bank Stadium on September 17, 2017 in Baltimore, Maryland. (Photo by Rob Carr /Getty Images)
INDIANAPOLIS, IN - SEPTEMBER 17: J.J. Nelson #14 of the Arizona Cardinals makes a juggling catch in the second quarter of a game against the Indianapolis Colts at Lucas Oil Stadium on September 17, 2017 in Indianapolis, Indiana. (Photo by Joe Robbins/Getty Images)
DENVER, CO - SEPTEMBER 11: Running back Melvin Gordon #28 of the Los Angeles Chargers dives over strong safety Justin Simmons #31 of the Denver Broncos in the second quarter at Sports Authority Field at Mile High on September 11, 2017 in Denver, Colorado. (Photo by Justin Edmonds/Getty Images)
LONDON, ENGLAND - SEPTEMBER 24: Corey Grant of the Jacksonville Jaguars is tackled Tony Jefferson of the Baltimore Ravens during the NFL International Series match between Baltimore Ravens and Jacksonville Jaguars at Wembley Stadium on September 24, 2017 in London, England. (Photo by Matthew Lewis/Getty Images)
PITTSBURGH, PA - OCTOBER 08: Leonard Fournette #27 of the Jacksonville Jaguars dives into the end zone for a 2 yard touchdown in the second quarter during the game against the Pittsburgh Steelers at Heinz Field on October 8, 2017 in Pittsburgh, Pennsylvania. (Photo by Justin K. Aller/Getty Images)
ARLINGTON, TX - OCTOBER 08: Aaron Rodgers #12 of the Green Bay Packers looks for an open receiver in the third quarter against the Dallas Cowboys at AT&T Stadium on October 8, 2017 in Arlington, Texas. (Photo by Tom Pennington/Getty Images)
HOUSTON, TX - OCTOBER 08: Will Fuller #15 of the Houston Texans makes a reception for a touchdown as he slips behind Terrance Mitchell of the Kansas City Chiefs in the fourth quarter at NRG Stadium on October 8, 2017 in Houston, Texas. (Photo by Bob Levey/Getty Images)
ATLANTA, GA - OCTOBER 15: Tevin Coleman #26 of the Atlanta Falcons stretches for a touchdown against Kiko Alonso #47 and Nate Allen #29 of the Miami Dolphins at Mercedes-Benz Stadium on October 15, 2017 in Atlanta, Georgia. (Photo by Kevin C. Cox/Getty Images)
EAST RUTHERFORD, NJ - OCTOBER 15: Tight end Austin Seferian-Jenkins #88 of the New York Jets is seen fumbling the ball after what was originally called a touchdown against strong safety Duron Harmon #30 and cornerback Malcolm Butler #21 of the New England Patriots during the fourth quarter of their game at MetLife Stadium on October 15, 2017 in East Rutherford, New Jersey. The Replay Official reviewed the runner broke the plane ruling, and the play was reversed and called a fumble. (Photo by Al Bello/Getty Images)
NEW ORLEANS, LA - OCTOBER 15: Marshon Lattimore #23 of the New Orleans Saints breaks up a pass thrown to Golden Tate #15 of the Detroit Lions at Mercedes-Benz Superdome on October 15, 2017 in New Orleans, Louisiana. The Saints defeated the Lions 52-38. (Photo by Wesley Hitt/Getty Images)
NEW ORLEANS, LA - OCTOBER 15: The New Orleans Saints defense celebrates during the second half of a game against the Detroit Lions at the Mercedes-Benz Superdome on October 15, 2017 in New Orleans, Louisiana. (Photo by Jonathan Bachman/Getty Images)
KANSAS CITY, MO - OCTOBER 15: Wide receiver Antonio Brown #84 of the Pittsburgh Steelers is upended by linebacker Kevin Pierre-Louis #57 of the Kansas City Chiefs after a catch over the middle during the second half of the game at Arrowhead Stadium on October 15, 2017 in Kansas City, Missouri. ( Photo by Peter Aiken/Getty Images )
CARSON, CA - OCTOBER 22: Adrian Phillips #31 of the Los Angeles Chargers attempts an interception on a pass to A.J. Derby #83 of the Denver Broncos during the third quarter at StubHub Center on October 22, 2017 in Carson, California. (Photo by Harry How/Getty Images)
BALTIMORE, MD - OCTOBER 26: A cat runs on the field during the fourth quarter of the game between the Baltimore Ravens and the Miami Dolphins at M&T Bank Stadium on October 26, 2017 in Baltimore, Maryland. (Photo by Rob Carr/Getty Images)
FOXBORO, MA - OCTOBER 22: Julio Jones #11 of the Atlanta Falcons catches a touchdown pass as he is defended by Malcolm Butler #21 of the New England Patriots during the fourth quarter of a game at Gillette Stadium on October 22, 2017 in Foxboro, Massachusetts. (Photo by Maddie Meyer/Getty Images)
NEW ORLEANS, LA - OCTOBER 29: Ted Ginn #19 of the New Orleans Saints catches a pass as he is defended by Eddie Jackson #39 of the Chicago Bears during the fourth quarter at the Mercedes-Benz Superdome on October 29, 2017 in New Orleans, Louisiana. (Photo by Chris Graythen/Getty Images)
GREEN BAY, WI - NOVEMBER 06: Brett Hundley #7 of the Green Bay Packers avoids a tackle attempt by Ezekiel Ansah #94 of the Detroit Lions in the third quarter at Lambeau Field on November 6, 2017 in Green Bay, Wisconsin. (Photo by Stacy Revere/Getty Images)
ARLINGTON, TX - NOVEMBER 05: Alex Smith #11 of the Kansas City Chiefs passes the ball under pressure from Jaylon Smith #54 of the Dallas Cowboys and Brian Price #92 of the Dallas Cowboys in the second quarter of a football game at AT&T Stadium on November 5, 2017 in Arlington, Texas. (Photo by Ron Jenkins/Getty Images)
DETROIT, MI - NOVEMBER 12: Darius Slay #23 of the Detroit Lions makes a tackle against Rashard Higgins #81 of the Cleveland Browns during the first half at Ford Field on November 12, 2017 in Detroit, Michigan. (Photo by Rey Del Rio/Getty Images)
NEW ORLEANS, LA - NOVEMBER 19: Preston Smith #94 of the Washington Redskins hits Drew Brees #9 of the New Orleans Saints and is called for a roughing the passer penalty at Mercedes-Benz Superdome on November 19, 2017 in New Orleans, Louisiana. (Photo by Wesley Hitt/Getty Images)
EAST RUTHERFORD, NJ - NOVEMBER 26: Quarterback Cam Newton #1 of the Carolina Panthers runs the ball to score a touchdown against outside linebacker Bruce Carter #54 of the New York Jets during the second quarter of the game at MetLife Stadium on November 26, 2017 in East Rutherford, New Jersey. (Photo by Al Bello/Getty Images)
FOXBORO, MA - NOVEMBER 26: Trey Flowers #98 and Kyle Van Noy #53 of the New England Patriots recover a fumble during the third quarter of a game against the Miami Dolphins at Gillette Stadium on November 26, 2017 in Foxboro, Massachusetts. (Photo by Jim Rogash/Getty Images)
LOS ANGELES, CA - NOVEMBER 26: Andrew Whitworth #77 of the Los Angeles Rams runs onto the field prior to the game against the New Orleans Saints at the Los Angeles Memorial Coliseum on November 26, 2017 in Los Angeles, California. (Photo by Sean M. Haffey/Getty Images)
ARLINGTON, TX - NOVEMBER 30: Byron Marshall #34 of the Washington Redskins leaps over Orlando Scandrick #32 of the Dallas Cowboys on a run in the first quarter of a football game at AT&T Stadium on November 30, 2017 in Arlington, Texas. (Photo by Wesley Hitt/Getty Images)
NASHVILLE, TN - DECEMBER 03: Logan Ryan #26 of the Tennessee Titans swats away a pass intended for DeAndre Hopkins #10 of the Houston Texans during the first half at Nissan Stadium on December 3, 2017 in Nashville, Tennessee. (Photo by Wesley Hitt/Getty Images)
ORCHARD PARK, NY - DECEMBER 3: Dion Lewis #33 of the New England Patriots stiff arms Jordan Poyer #21 of the Buffalo Bills during the second quarter on December 3, 2017 at New Era Field in Orchard Park, New York. (Photo by Tom Szczerbowski/Getty Images)
ATLANTA, GA - DECEMBER 07: Tommylee Lewis #11 of the New Orleans Saints dives for a touchdown as he is tackled by De'Vondre Campbell #59 of the Atlanta Falcons at Mercedes-Benz Stadium on December 7, 2017 in Atlanta, Georgia. (Photo by Kevin C. Cox/Getty Images)
ORCHARD PARK, NY - DECEMBER 10: Colton Schmidt #6 of the Buffalo Bills walks the field before a game against the Indianapolis Colts on December 10, 2017 at New Era Field in Orchard Park, New York. (Photo by Brett Carlsen/Getty Images)
CHARLOTTE, NC - DECEMBER 10: Jonathan Stewart #28 of the Carolina Panthers runs for a touchdown against the Minnesota Vikings in the first quarter during their game at Bank of America Stadium on December 10, 2017 in Charlotte, North Carolina. (Photo by Grant Halverson/Getty Images)
CHARLOTTE, NC - DECEMBER 10: Jonathan Stewart #28 of the Carolina Panthers leaps into the end zone to score the game-winning touchdown against the Minnesota Vikings during their game at Bank of America Stadium on December 10, 2017 in Charlotte, North Carolina. The Panthers won 31-24. (Photo by Grant Halverson/Getty Images)
MIAMI GARDENS, FL - DECEMBER 11: Danny Amendola #80 of the New England Patriots fails to complete a touchdown against the defense of T.J. McDonald #22 of the Miami Dolphins in the fourth quarter at Hard Rock Stadium on December 11, 2017 in Miami Gardens, Florida. (Photo by Mike Ehrmann/Getty Images)
DETROIT, MI - DECEMBER 16: Chicago Bears wide receiver Markus Wheaton #12 juggles the ball for an incomplete pass against the Detroit Lions during the second half at Ford Field on December 16, 2017 in Detroit, Michigan. (Photo by Gregory Shamus/Getty Images)
CHARLOTTE, NC - DECEMBER 17: Damiere Byrd #18 of the Carolina Panthers catches a touchdown pass against Josh Hawkins #28 of the Green Bay Packers in the third quarter during their game at Bank of America Stadium on December 17, 2017 in Charlotte, North Carolina. (Photo by Grant Halverson/Getty Images)
FOXBORO, MA - DECEMBER 24: Devin McCourty #32 of the New England Patriots breaks up a pass intended for LeSean McCoy #25 of the Buffalo Bills during the second quarter of a game at Gillette Stadium on December 24, 2017 in Foxboro, Massachusetts. (Photo by Adam Glanzman/Getty Images)
GLENDALE, AZ - DECEMBER 24: Tight end Evan Engram #88 of the New York Giants is unable to catch the pass against the Arizona Cardinals in the first half at University of Phoenix Stadium on December 24, 2017 in Glendale, Arizona. (Photo by Norm Hall/Getty Images)
PITTSBURGH, PA - DECEMBER 31: Darrius Heyward-Bey #88 of the Pittsburgh Steelers runs up field for a 29 yard touchdown run in the first quarter during the game against the Cleveland Browns at Heinz Field on December 31, 2017 in Pittsburgh, Pennsylvania. (Photo by Justin Berl/Getty Images)
SEATTLE, WA - DECEMBER 31: Wide receiver Jaron Brown #13 of the Arizona Cardinals celebrates his 25 yard touchdown catch against cornerback Byron Maxwell #41 of the Seattle Seahawks during the first quarter at CenturyLink Field on December 31, 2017 in Seattle, Washington. (Photo by Otto Greule Jr/Getty Images)
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"If that deduction goes away, what you will see is a dramatic sea change in the college sports landscape," Duke athletic director Kevin White told ESPN's Darren Rovell. "We need to put speed bumps up now to slow this thing down, because I don't think the politicians have any idea how much this will pull apart our system."

Under the current system, fans are often required to make a substantial donation before they are allowed to purchase season tickets for premium seats. This allows athletic programs to sell their tickets for huge sums while giving their customers a nice tax break.

Rovell provided an instructive example: at LSU, a 2017 season ticket for a seat on the 50-yard line required a $1,025 donation, which allowed the fan to then purchase the ticket itself for $425. The latter figure is fully taxable, but the donation that facilitated the purchase of the actual ticket is deductible by 80%.

Many officials are concerned that without the tax break, consumers will stop making the donations. LSU athletic director Joe Alleva put the situation in stark economic terms.

"We take in $50 million to $65 million a year in donations related to tickets," said LSU athletic director Joe Alleva. "If even 10 percent of people say, 'We're not going to do that anymore,' that's at least $5 million to us. We have no other place to make that money up."

Critics of the provision are concerned that the student-athletes may be the ones who end up most negatively affected. White said the reforms would "significantly compromise the opportunities for young people" to receive athletic scholarships. Some worry that the NCAA's less popular sports, such as bowling, rowing, and rifle shooting, could be especially impacted.

Still, others insist that ending the deduction is long overdue, asserting that it benefits only the deep-pocketed benefactors who can afford the hefty donations.

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