The NCSL Blog

30

By Andrew Smalley   

College athletes earn billions of dollars annually for their schools, television networks, apparel companies and the National Collegiate Athletic Association.

College athletes in California could be allowed to strike their own endorsement deals and hire agents under a bill signed into law by Gov. Gavin Newsom. The measure is scheduled to take effect in 2023.CreditThomas Graning/Associated PressShould those student-athletes get a share of that revenue, in addition to the scholarships which pay for their education?

That question is poised to have more lasting impact on college sports than a buzzer-beating basket in the Final Four, or an electrifying touchdown in the national championship football game.

A California law tests the theory of college amateurism and is being closely watched by both state and national lawmakers. The bill, SB 206, also known as the Fair Pay to Play Act, passed unanimously and was signed by Governor Gavin Newsom (D) on Monday.

Each year, more than 460,000 college students compete in collegiate athletics, says the NCAA. College athletics, fueled by lucrative TV contracts for sports such as football and basketball, have become a major revenue source for many athletic programs and schools.

California’s bill, set to go into effect in 2023, will allow college athletes to hire an agent and be paid for the use of their name, likeness and image. Under the legislation, individual schools and the NCAA would not be able to ban students from earning this compensation.

In recent years, legislators both at the state and federal level have debated whether student-athletes should receive additional pay for playing a sport while in college. The NCAA has long sought to prevent compensation for athletes to preserve the amateurism of college athletics.  

In 2019, four states introduced legislation to compensate college athletes or allow college athletes collective bargaining powers.

The NCAA responded to the bill’s passage with a letter to Newsom arguing that the legislation would remove the distinction between college and professional athletics and would “negatively impact more than 24,000 California student-athletes.” The letter also says the bill would mean college athletes from California will be unable to compete in NCAA competitions and tournaments.

The bill was opposed by the California State University system over concerns that the legislation would not allow student-athletes to compete in NCAA events and might remove their scholarship eligibility. Private colleges such as Stanford and the University of Southern California have also opposed the bill.

The NCAA has said it will consider challenging the bill in court and that the legislation violates the Commerce Clause and would be ruled unconstitutional.

While California is the only state to pass student-athlete pay legislation, other states have introduced similar legislation. Washington HB 1084, would have allowed students to be represented by agents and receive compensation for their image and name. That bill did not pass in the 2019 session. Lawmakers in South Carolina announced plans to introduce legislation similar to California’s bill in January 2020.

Other states are also considering different approaches to compensation for student-athletes. In 2019, Maryland legislators introduced, but did not pass, HB 548 which would have required the state to create a collective bargaining process for college athletes. Additionally, a bill has been pre-filed for 2020 in Tennessee that would create a grant fund to compensate student-athletes after they graduate.

At the federal level, North Carolina Congressman Mark Walker (R) introduced the Student-Athlete Equity Act which would enact provisions similar to the California bill across the country.

Given the divided public polling on whether student-athletes should be paid and the amount of revenue at stake for both colleges and athletes, this issue is likely to remain a pressing concern for schools and states.

Andrew Smalley is a research analyst in NCSL's Education Program.

Email Andrew.

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About the NCSL Blog

This blog offers updates on the National Conference of State Legislatures' research and training, the latest on federalism and the state legislative institution, and posts about state legislators and legislative staff. The blog is edited by NCSL staff and written primarily by NCSL's experts on public policy and the state legislative institution.