As the seventh year of the Financial Aid Reporting Program closed, results suggested a number of Division III member institutions were still misapplying the division’s financial aid legislation.  This misapplication of financial aid legislation has led 14 institutions to have their cases referred to the NCAA enforcement staff to be processed as major violations since 2007.
Institutions can avoid the pitfalls that often lead to these violations by striving to meet the recommendations outlined below. While this list is intended to represent an ideal set of best practices, institutions must also determine the best use of their available funding and staffing resources.
Emphasis on Institutional Control and Shared Responsibility
NCAA Division III presidents and chancellors should stress the importance of and the commitment to NCAA rules compliance within their institutions. Some key considerations:
Institutional Control: NCAA Constitution 6.1.1 vests the ultimate responsibility and final authority for the conduct of the institution’s intercollegiate athletics program in the hands of the institution’s president or chancellor. This responsibility includes oversight of the institution’s administration of financial aid. Additionally, an institution’s president or chancellor should meet with the athletics department coaching and administrative staff on an annual basis, at the beginning-of-the-year compliance meeting, to stress the importance of NCAA rules-compliance and a no-tolerance policy for staff members who knowingly, intentionally or negligently violate NCAA legislation. Further, the institution’s president or chancellor should emphasize the importance of attendance at any rules-education seminars (which should be conducted as part of a campus-wide education effort) and the consequences of excessive absences from these seminars.
Adequate Personnel: Institutions should designate a full-time senior athletic department staff member to lead the institution’s athletics compliance office, and whose sole (or primary) responsibility should be the oversight of athletics compliance. These responsibilities should include developing rules-education and formalized monitoring programs for athletics compliance.
Direct Reporting: Institutions should address the organizational structure of the athletic department to allow the athletic director at least a shared direct reporting line to the institution’s president or chancellor. The president or chancellor’s ability to be fully informed about relevant rules-compliance issues will assure that the institution’s commitment to full compliance is supported and overseen at the highest level of institutional administration.
Shared Responsibility: While the institution’s president or chancellor is charged with the ultimate responsibility for institutional control, the responsibility for compliance with NCAA legislation is truly shared by everyone involved with athletics at an institution. This includes athletics department staff members, coaches, student-athletes, representatives of athletics interests, and employees whose responsibilities interface with athletics (i.e., financial aid, admissions).
Administration of Financial Aid to Student-Athletes and Financial Aid Monitoring
Institutions must have an athletics compliance program in place that addresses the administration of financial aid to student-athletes. This program, at a minimum, should include the following measures:
Establish Clear Communication Lines: The senior athletics compliance administrator should be designated as the athletic department’s liaison to the admissions office so coaches and other athletics staff members do not communicate directly with the admissions administrators. Further, coaches should not be permitted to communicate with the financial aid office regarding the prospective student-athletes they are recruiting.
Define Departments: Institutions must separate the responsibilities of the admissions and financial aid offices. Administrators involved in the admissions process should not make decisions on either need or non-need based financial aid awards. Information obtained in the admissions process concerning athletics participation, leadership or ability should not be shared directly or indirectly with those responsible for financial aid administration. It goes without saying that at least as strict a separation between athletics and student financial aid offices should be maintained.
Review Scholarship Criteria: Institutions should conduct a full review of the determining criteria for all scholarships administered by the institution and, where necessary, amend said criteria to eliminate direct or indirect references to athletically-related factors prohibited by NCAA legislation. Institutions should implement the following safeguards: (1) identify the institution as an NCAA Division III institution on its web site and discuss the commensurate prohibition on athletically-related financial aid; (2) on application materials for all institution-administered scholarships, identify the institution as an NCAA Division III institution that prohibits athletically-related financial aid; and (3) provide guidance to all scholarship committees on permissible evaluation of applicant qualifications pursuant to applicable NCAA legislation. For example, no members of the athletics department staff should serve on scholarship committees.
Self-Assessment: Institutions should develop a data program that allows the institution to perform a real-time internal audit of all financial aid awards for first-time/full-time freshman and transfer students.
Document, Document, Document: In each student file, the institution should place written documentation describing the student’s qualifications for any award offered. The senior compliance administrator should review all student-athlete files (or perform spot-checks of selected student-athlete files) to ensure that all financial aid awards to student-athletes are permissible under NCAA legislation. This review should be done prior to any student-athlete receiving notification of his or her financial aid award for the upcoming academic year.
Athletics Financial Aid Committee: Institutions should establish an athletics financial aid committee to provide oversight of the institution’s administration of financial aid to student-athletes. This oversight should include, but is not limited to, developing institutional policies and procedures regarding financial aid for student-athletes, monitoring the administration of financial aid to student-athletes, organizing rules-education efforts and developing rules-education seminars and materials, and serving as a resource for institutional staff members on financial aid related issues. The athletics financial aid committee should meet no less than once a month and should include, at a minimum, the institution’s faculty athletics representative, athletics director, senior athletics compliance administrator, a representative from the office of financial aid, a representative from the registrar’s office, and a representative from the admissions office. The committee could be chaired by the faculty athletics representative or another individual deemed appropriate.
Athletics Compliance Manual: Institutions should develop an athletics compliance manual addressing all areas of NCAA Division III rules-compliance, including financial aid. Each chapter of the rules-compliance manual should include all relevant institutional policies and procedures, references to NCAA rules, forms, key definitions, applicable bylaw citations, and revision history. The rules-compliance manual should be distributed to all athletics staff members, coaches, and institutional employees whose responsibilities interface with athletics (i.e., financial aid, admissions, etc.).
Compliance Hotline: The senior athletics compliance administrator should set up an anonymous hotline (e.g., phone line or web-based questionnaire) for the reporting of any known or suspected rules-violations.
Rules-Education Programming & Training
Institutions should establish comprehensive rules-education programs that include the following measures:
Communication: The senior athletics compliance administrator should create a process for institutional staff members, coaches, student-athletes, and representatives of athletics interests to submit questions relating to rules-compliance and legislative interpretations. At least once a semester, the athletics department should distribute an electronic newsletter or other e-mail that includes interpretations, questions and answers, examples, and reminders of NCAA legislation to all athletics and other institutional employees involved with NCAA-related issues.
Formal, Broad Rules Education: NCAA rules-education sessions should be provided to the institution’s coaches, athletics administrators, and institutional staff members whose responsibilities interface with athletics-aid (e.g., admissions, retention, financial aid, etc.). These education sessions should be conducted regularly (perhaps monthly) and should include reviews of recent bylaw interpretations, educational columns, secondary cases, and major enforcement cases. These sessions should also stress timely rules-compliance issues (e.g., sports gambling legislation during March Madness). The senior athletics compliance administrator should take attendance at each session and follow up with personnel who are absent. Athletics staff members, coaches and institutional employees whose responsibilities interface with athletics should have a copy of the NCAA Division III manual, any applicable conference manuals, and the institution’s rules-compliance manual.
Annual Training: The institution should hold an annual rules-education seminar for campus entities involved in supporting the intercollegiate athletics program, including staff members from the registrar’s office, admissions, financial aid, and advancement. The seminar should be held at the conclusion of each academic year and should address current athletics compliance policies and procedures, the effectiveness of current monitoring programs, and an open discussion regarding essential changes for the following year.
Regional Rules Attendance: Institutions should consider requiring the institution’s athletic director and senior athletics compliance administrator to attend regularly the NCAA Regional Rules Seminar. Additionally, the institution should rotate representatives from the financial aid, registrar, and admissions offices to attend once every three years. Institutional staff members who attend the NCAA Regional Rules Seminars should debrief the institution’s coaches, athletic administrators, and other staff members who interface with athletics in subsequent rules-education sessions. This will assist the athletics compliance office with educating institutional offices that interface with athletics and all other institutional personnel who have athletics responsibilities about relevant NCAA rules.
Interim Training: Institutions shall require any mid-year hires in the financial aid or admissions office to attend a specialized rules-education seminar regarding the institution’s financial aid process. This seminar should occur within one month of the individual’s hiring date.
External Audit of the Financial Aid Program
Institutions should retain a qualified outside entity for an outside audit of the institution’s financial aid program at least once every four years. This program should include, at a minimum, reviews of the institution’s athletics rules-education program and financial aid policies and procedures, a random sample of applications for prospective students, and the institution’s self-assessments over the past three years. The audit should also include a meeting with the institution’s president or chancellor, the athletic financial aid committee, and general counsel to provide recommendations and potential athletics compliance issues. The outside entity should also provide a detailed report to the institution’s president or chancellor and athletics financial aid committee within one month of the audit.
NCAA Division III financial aid legislation prohibits institutions from considering athletics participation or ability in the awarding of financial aid. To ensure compliance with these rules, the NCAA compares the financial aid packages of first-time, full-time student-athletes with the aid packages of other first-time, full-time students. Institutions should take advantage of preventative measures outlined in this Note, including regular rules-education for employees in relevant departments, policy review and drafting, and careful monitoring of the financial aid process, in order to avoid NCAA sanctions.