US college athletes now allowed to earn money from endorsements

Overseas-education | BLOOMBERG 13 Jul 2021

The national collegiate Athletic Association adopted a stopgap policy that lets student athletes earn money from activities like social media posts and autograph signings, reversing decades of restrictions.

The NCAA's governing bodies have approved the interim policy for athletes in all 50 US states and across all three divisions. The organization rushed to come up with a solution just before new rules were set to take effect in at least 10 states.

Failing to act would have led to a jumble of rules that some colleges argued would create an unfair advantage for states where athletes can be paid.

The move levels the playing field for athletes in states like Washington and New York, which haven't moved as quickly as Texas, Florida and Alabama.

This model is expected to serve as a standard until federal legislation is enacted. Competing bills and disagreements mean federal action may not come for months, if at all, according to observers.

"With the variety of state laws adopted across the country, we will continue to work with Congress to develop a solution that will provide clarity on a national level," said NCAA president Mark Emmert. "The current environment prevents us from providing a more permanent solution and the level of detail student athletes deserve."

Individual conferences and schools may draft their own positions in states that don't have NIL legislation - rules governing the use of an athlete's name, image and likeness.

Universities, for example, may have to decide if students can endorse alcoholic beverages or marijuana in states where it's legal.

The University of Florida is barring students from agreements with gambling and sports-wagering vendors or companies associated with athletic-performance enhancing drugs. The University of Alabama also won't allow student athletes to enter into deals with companies that sell tobacco, alcohol, adult entertainment or casino services.

The rules governing what student athletes may earn are slowly being rewritten - in the courts and in legislative bodies. College football and basketball programs can produce huge economic windfalls for schools, but the athletes who bring in the fans and TV sponsors historically have earned little, if anything.

Spokane, Washington-based Gonzaga University is among the many colleges that have prepared for relaxed regulations. The school's deputy director of athletics, Chris Standiford, said that Gonzaga has a "great plan in place" for its students to capitalize on their following - on and off the field.

The US Supreme Court recently issued a decision that potentially upends sports economics and could marginalize small schools or programs that lose money. While the ruling was narrow in nature, it opened the door for extra athlete compensation and rejected the NCAA's bid for broad antitrust immunity.

The decision enables schools to provide athletes with compensation related to education, such as for laptops, tutoring and paid internships. That includes academic achievement awards as large as the athletic achievement awards they already provide, currently with a US$5,980 (HK$46,650) annual cap.

While "pay for play" remains off the table for now, the NCAA decision on marketing will enable athletes to make thousands of dollars from the use of their names, images and likenesses.

The move "also reinforces key principles of fairness and integrity across the NCAA and maintains rules prohibiting improper recruiting inducements," said Division II Presidents Council chair Sandra Jordan, chancellor at the University of South Carolina Aiken. "It's important any new rules maintain these principles."

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