NCAA opposing California bill pushing revenue sharing for athletes

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Usually reticent to take positions on state legislation early in the lawmaking process, the NCAA is forcefully expressing its opposition to a bill in California that would give college athletes the opportunity to participate in revenue sharing with their schools, among other wide-ranging changes aimed at mandating and regulating athlete welfare.

‘The NCAA believes the California legislation is the wrong solution at the wrong time,’ the association’s new senior vice president of external affairs, Tim Buckley, told USA TODAY Sports. ‘It will only further complicate an already murky picture while we’re working with Congress to create a uniform playing field in this space.

‘I think we will see something emerge on the Senate side. Another state law at this time is not the right fix.”

Buckley said he did could not provide any specifics about when a Senate proposal might be made, or by whom.

New NCAA leaders, new state-level challenges

Buckley was brought to the NCAA by Charlie Baker, who became the association’s president on March 1 after most recently serving as Massachusetts’ governor. Buckley had been Baker’s chief of staff in Boston, and he now oversees the NCAA’s government relations and communications work.

His comments come a week after the California bill passed through the first committee to consider it, the Assembly’s Higher Education panel. It is now set for consideration on May 3 by the Assembly’s Appropriations Committee, which is chaired by the bill’s sponsor, Chris Holden. Holden is a Democrat who graduated from San Diego State and played four seasons of basketball at the school.

A spokesman for Holden said Holden did not want to comment immediately on Buckley’s statements.

For the bill to stay alive this year, it must pass the Appropriations Committee no later than May 19 and the Assembly no later than June 2.

Days before Holden’s bill began moving, Arkansas Gov. Sarah Huckabee Sanders signed into law changes in her state’s statute regarding college athletes’ ability to profit from their name, image and likeness (NIL). Several of those changes appear to conflict with NCAA rules, including those related to schools’ interactions with collectives — booster- and business-driven organizations that have formed to pool resources and NIL opportunities for athletes at various schools and can be promoted in limited ways by the schools.

On Monday, the Oklahoma legislature formally sent a similar measure to Gov. Kevin Stitt, and the Texas House all but approved another look-alike.

Although the NCAA does not like the prospect of these conflicts between its rules and state laws, it has not openly and actively opposed any of these bills. California’s is a different matter, at least in part because of the state’s recent history and national impact.

The landscape in California

In early 2019, California state Sen. Nancy Skinner introduced a bill that would make the state the first to clear college athletes’ path to getting money or other forms of compensation from endorsements, public appearances, signing autographs and other ventures. The bill was opposed by schools in the state, but the NCAA was reluctant to get involved publicly as it went through Senate committees, then passed the Senate by a 31-5 vote.

About a month later, with the bill set for its first consideration by an Assembly committee, then-NCAA president Mark Emmert sent a letter to the chairs of two committees that implied that if the bill became law as it was written, California schools could face the prospect of being prohibited from participating in NCAA championships when the bill was scheduled to take effect in 2023.

But momentum for the bill had gathered, and it sailed through three committees and the Assembly floor, drawing a combined total of one opposing vote. When it went back to the Senate, it was approved 39-0. Gov. Gavin Newsom signed it on Sept. 30, and other states quickly followed suit.

That set the NCAA on its path to its current state of affairs with NIL: Many athletes making some money. Some athletes making a lot of money. Little enforcement of existing rules and laws that are starting to be torn down by state legislators.

What could happen with California bill

Under Holden’s bill, much of which would take effect in 2024, public and private schools in California would subject to a new, extensive regulatory structure overseen by a 21-member California Athlete Protection Panel appointed by the governor, the Assembly Speaker and the Senate Rules Committee. The panel would be required to develop and enforce health and safety standards, and it would have subpoena power.

The most contentious aspect of the new structure — but far from the only one — would be athletes potentially receiving annual payments of up to $25,000 from their schools for playing their sports. The pool of money available to athletes in each sport could be determined by the amount of revenue attributed to each sport under the U.S. Department of Education’s athletics financial reporting system. It is widely assumed that this would disproportionately benefit football and men’s basketball players. 

Buckley contended: “It would direct funds away from Olympic sports and women’s sports.’ Buckley estimated that those athletes comprise 90% of California’s student-athletes population.

The bill does, however, include a provision that would allow schools to adjust the amounts they would have to pay athletes in various sports “to comply with Title IX proportionality comparisons in athletics.” Another provision would allow schools to base the pool of money to which athletes could be entitled only on amounts in excess of revenues for the 2021-22 school year. This is intended to preserve funding of lower-revenue sports and slow the impact of potentially having to pay athletes in higher-revenue sports.

Other financial pressure could come from the bill’s requirement that the state’s schools, following an indexed scale based on athletics revenue, would have to annually combine to fund up to $7 million in costs for the regulatory panel.

They also would have to provide enhanced health-care coverage and scholarships covering up to six academic years of full-time college attendance or until an athletes receive an undergraduate degree, whichever occurs first.

“The NCAA is already moving forward on a lot of these benefits,” Buckley said. The Division I Board of Directors could approve a package of new benefits for athletes on Wednesday.

Other fundamental changes

The bill, as written, would change college sports in California. But its impacts would be felt both inside and outside the state. For example:

►The National Letter of Intent would be replaced for California schools — and for out-of-state schools making offers to California residents — by a document to be created by the regulatory panel.

►California schools and out-of-state schools that are recruiting in the state would have to submit to the regulatory panel a set of information about their NIL policies.

►Schools in the state would have to annually complete an evaluation of their compliance with Title IX in athletics and make it public.

►If the regulatory panel determined through an administrative hearing that a school has eliminated roster slots on a team, reduced aggregate scholarship amounts or eliminated a team while paying a coach or athletics administrator an annual salary of $500,000 or more, the school’s athletics director would be suspended for at least three academic years.

►The regulatory panel would be required to develop standards under which it would certify college-athlete agents, marketers and financial advisers.

“The California bill really seeks to micromanage resources,” Buckley said, “and it would put (21) unelected, political appointees in the driver’s seat of college sports in California.”

This post appeared first on USA TODAY