According to a bill passed by the California State Assembly, state colleges and universities would have to share a percentage of revenues with athletes.
California, the state that led sweeping Name, Image and Likeness (NIL) reform, is now trying to take collegiate athlete rights one step further — with revenue sharing.
Assemblyman Chris Holden, a Pasadena Democrat, introduced Thursday the College Athlete Protection Act, a law that could radically transform the economy around collegiate athletics.
The College Athlete Protection Act requires state colleges and universities to share a percentage of revenue with athletes who compete in soccer, men’s basketball, and women’s basketball. The payment amounts are based on the programs’ annual revenue, according to legal text shared with Sports Illustrated ahead of Thursday’s announcement.
The bill, Assembly Bill 252 (AB252), ties a portion of an athlete’s salary to completion; does not consider athletes employees of their universities; calls on schools to provide medical care and scholarships to athletes according to their eligibility; and calls for the suspension of athletic directors for at least three years as severe punishment if they eliminate rosters, reduce scholarship amounts, or discontinue athletic programs.
“It comes as no shock that collegiate athletes suffer injuries on the field, court or game,” Holden said in a statement to SI. “What is shocking is the lack of protections to help athletes when they are down or too afraid to speak up because of the repercussions, the loss of scholarships and ultimately the loss of a promising career. That ends now with AB252.”
The legislation, dropped amid an athletes’ rights movement that has produced sweeping changes to archaic NCAA policy, touches on a raging problem that runs through collegiate sports. The revenue share debate has gained momentum as revenue growth continues to accelerate in the collegiate sports industry from multi-million dollar football and basketball TV deals.
Similar to its NIL legislation, California could put its universities in a precarious position. The College Athlete Protection Act would require them to break NCAA rules, which could be another blow to the organization’s crumbling foundation of amateurism. California was the first in a series of states to pass legislation allowing its collegiate athletes to receive compensation from NIL, a move that forced the NCAA to scrap its age-old bans on the issue.
This new bill is another affront to the NCAA’s current statutes. The organization, made up of the schools themselves, limits what universities can offer athletes to tuition and participation costs. Direct payments to athletes – known as “pay-for-play” – are prohibited.
While a similar bill fell through in the California Senate last year, primarily over gender equality concerns, this streamlined version gives schools more flexibility in complying with Title IX and revenue-sharing regulations, and its sponsor Holden is the chair the powerful Appropriations Committee of the State Assembly. These factors inspire optimism in this version coming through California’s Democrat-controlled bicameral legislature.
The bill has strong support from the National College Players Association (NCPA), an athlete advocacy group governed by the U.S. Steelworkers and directed by former UCLA linebacker Ramogi Huma. The organization is responsible for years of aggressive pressure on athletes to get a piece of the money pie.
“The status quo in NCAA sport is abusive, deadly and exploitative,” Huma said in a statement to SI. “This law would ensure that collegiate athletes enjoy critical protections and a fair share of the earnings they generate to support college completion.”
Under the bill, athlete payments would be capped at $25,000 a year, but excess money — it could be in the millions — would be placed in a trust so players could earn the money after they graduate. From the time they are accepted into college, they have six years to graduate or lose funds.
The bill would require schools to share revenue with athletes in sports who earn twice as much revenue as that sport spends on athletic scholarships. At most schools, these sports include soccer, men’s basketball, and women’s basketball.
Athletes would earn 50% of the earnings from their respective sport, but that figure is offset by the amount they receive in athletic scholarships. A school would have to pay the athletes the difference.
For example, USC football brought in $50 million in revenue, according to 2018 budget figures provided to the U.S. Department of Education. The school paid out approximately $6.3 million in scholarships. That leaves a $19 million gap between the amount paid in grants ($6.3 million) and 50% of total sports revenue ($25 million).
Under the bill, USC would have to distribute that amount ($19 million) to its 85 scholarship football players. On average, each player would make around $215,000 per year. Men’s basketball players at USC would make about $155,000. Female basketball players would get $110,000.
However, the bill gives schools a second way to pay athletes in the form of new revenue. Should a school choose this route, any new revenue generated in a given year would be distributed among the athletes competing in the qualifying sports.
For example, if School A’s soccer program brought in $50 million in revenue in 2021 and $60 million in 2022, School A would need to distribute the $10 million in new revenue to the athletes. If earnings do not change from one year to the next, nothing is owed to the athletes.
This new revenue option was not included in the original bill that was introduced last year. It gives universities the ability to allocate a smaller amount of additional funding to athletes to support other non-income-generating sports programs, many of which are Olympic sports teams such as swimming and diving, track and field, and gymnastics. These sports, as well as many women’s basketball programs, often lose millions of dollars a year.
At the highest level of the FBS, Olympic sports are often financially backed by winnings in soccer and men’s basketball — winnings that would theoretically be used to pay athletes in a revenue-sharing model. But the vast majority of FBS programs don’t report profits, some even losing money on major sports like soccer and basketball. In this case, Olympic sports are often funded through tuition, donations, or post-season tournament payouts.
According to Huma, there are additional earnings that are not categorized by sport – such as B. Donations – which may be allocated to athletes under a revenue-sharing model. There are other ways to reallocate funds to pay athletes such as: Examples include cutting exorbitant coach salaries in football and basketball, slowing down modernization and renovation of facilities, and downsizing staffing levels.
In the USC example above, under the revenue-sharing model, the school would pay out more than $21 million in additional funds to athletes annually — or about 18% of their total sports revenue. This number could soon change given the realignment of the conference.
The law, if passed, would take effect in January 2024, the year USC and UCLA are expected to join the Big Ten and boost their athletic budgets. The Big Ten struck a TV deal worth more than $1 billion annually, more than doubling USC and UCLA’s current distribution of media rights to the Pac-12. Much of the new revenue flowing into these sports departments could find its way into the hands of athletes under the proposed legislation.
Rising dollar numbers are behind the current athletes’ rights movement. In the most recent example, conference commissioners and presidents just approved an expansion to the college football playoffs that experts say could bring in $2 billion in television revenue annually.
The NCPA and its Executive Director Huma are among the most public critics of the NCAA’s amateur rules. The group won a victory in June 2021 when the US Supreme Court unanimously ruled against the NCAA in a case involving educational benefits to athletes.
The ruling further undermined the federation’s amateurish facade at a time when state laws opened the door for athletes to earn compensation from their NIL, which is now a thriving industry in which brands and boosters sell millions to college players to distribute.
The NCAA, caught in a purgatory between amateurism and professionalism, continues to be pushed toward the professional model, and many believe more changes are on the way. This includes employment status for athletes.
The California bill offers an important caveat: Payments to athletes “should not serve as proof of employment.” Athlete employment status is one of the many fierce debates within the industry, with NCAA and college administrators opposing the idea.
However, there is a significant movement to consider athletes as employees. The National Labor Relations Board announced last month that it plans to file unfair labor practices charges against USC, Pac-12 and NCAA as individual and joint employers of FBS football players and Division I basketball players. The move was announced 10 months after the NCPA filed charges with the NLRB Bureau.
Experts say that with the Supreme Court’s Alston ruling, the implementation of NIL, the restructuring of the NCAA and, perhaps most importantly, a Democratic-controlled White House and US Senate, it’s an ideal time for athletes to become employees to apply.
“Every day the status quo seems more untenable,” Gabe Feldman, a professor of sports law at Tulane, said in an SI interview last spring. “It is likely that some significant changes will occur in the near future. There is agreement: athletes should be given more. The question: How do we do that and at the same time protect the foundations of university sports?”
The new California law would not only grant athletes a portion of their team’s earnings. Other provisions of the bill are:
Do all d1 athletes get money?
Do you get paid in D1? Are D1 athletes paid? Under a new rule introduced by the NCAA in 2021, D1 athletic students can now receive compensation, although they cannot receive it directly from their school. Rather, they can be paid by their name, picture and likeness, or NIL.
How do D1 athletes get money?
In addition to branding contracts, student athletes have run branded training clinics and been paid for appearances and autograph sessions. Unlike professional influencers, college athletes tend to have small audiences on social media.
What do D1 athletes get?
D1 athletes are given every type of gear imaginable. To see also : Colts Owner Buys Muhammad Ali’s 1974 ‘Rumble in the Jungle’ Belt. This includes socks, shoes, compression pants, shorts, sweatpants, sweatpants, singlets, t-shirts, long-sleeved shirts, polo shirts, raincoats, sweatshirts, coats, caps, hats and any other accessories related to the sport you practice.
How much do D1 college athletes get paid?
As of January 11, 2023, the median annual salary for a student athlete in the United States is $46,555 per year. This may interest you : Degree in Sports Management: Courses, Careers and PMF.
Do college athletes get everything paid for?
As a result of the NCAA v. Alston ruling, collegiate athletes now have the right to benefit from their name, image and likeness (NIL) while retaining the right to compete in their sport at the collegiate level. Read also : WNBA BPI marks a turning point for women’s sports metrics. (The ban on schools paying athletes directly remains in effect.)
Do all d1 athletes get paid? The NCAA has long banned its athletes from earning monetary compensation during their collegiate careers. But that last changed in June 2021, when the Supreme Court ruled that the NCAA couldn’t limit “education-related payments” to athletes.
Do college athletes get paid anything?
NCAA and NCAA v. Alston, along with new state laws, have allowed collegiate athletes to begin monetizing their name, image and likeness, and have granted players additional educational benefits. But as the NCAA’s pie has grown exponentially, most athletes’ share of that pie is still crumbs.
How much money do college athletes bring in?
The National Collegiate Athletic Association (NCAA) had record revenue of $1.16 billion for the 2021 fiscal year ended August 31, an increase from $519 million in 2020.
How do college athletes get paid?
In addition to branding contracts, student athletes have run branded training clinics and been paid for appearances and autograph sessions. Unlike professional influencers, college athletes tend to have small audiences on social media.
Do all D1 athletes get money?
The NCAA has long banned its athletes from earning monetary compensation during their collegiate careers. But that last changed in June 2021, when the Supreme Court ruled that the NCAA couldn’t limit “education-related payments” to athletes.
How Much Are D1 College Athletes Paid? As of January 11, 2023, the median annual salary for a student athlete in the United States is $46,555 per year.
How do D1 athletes get money?
In addition to branding contracts, student athletes have run branded training clinics and been paid for appearances and autograph sessions. Unlike professional influencers, college athletes tend to have small audiences on social media.
What do D1 athletes get?
D1 athletes are given every type of gear imaginable. This includes socks, shoes, compression pants, shorts, sweatpants, sweatpants, singlets, t-shirts, long-sleeved shirts, polo shirts, raincoats, sweatshirts, coats, caps, hats and any other accessories related to the sport you practice.
