Earlier last month, a U.S. House bill, the SCORE Act, was pulled for further work. Endorsed by the NCAA’s College Sports Commission, the goal of the bill was to create and enforce a set of uniform, federal rules to regulate name, image, and likeness (NIL), revenue sharing and add controls to the transfer portal. The opponents to the bill argued that the legislation came at the expense of athletes and was a gift to the NCAA and the Power conferences. The bill would have permitted the NCAA to cap NIL deals, set a limit on transfers, establish fair-market-value on NIL deals, and limit conflicts with existing university sponsorship deals. Finally, the bill stopped athletes from becoming employees and shielded the NCAA and the Commission from antitrust and state court lawsuits. The argument by the legislative opposition contended that this legislation was not ready for ‘prime time.’
A similar congressional bill was throttled the same week. That bill aimed to establish uniform Federal standards for NIL rights, pooling media rights, and the creation of a Commission to stabilize College Sports over a two-year timeline. The goal was to establish a less chaotic governance model for college sports and establish a set of uniform rules across athletics. It, too, was put on hold.
All these legislative efforts do not address the growing blurring of the line between professionals and collegiate athletes. DU hockey fans have already seen the influx of AHL players entering the NCAA (and recent NBA draftees who never played in the NBA), petitioning the NCAA for eligibility. Just how far are we from seldom-used major league players in any number of sports returning to play college ball? Maybe closer than anyone thinks.
There are further legal efforts to classify student-athletes as ’employees’. The NCAA has insisted that student-athletes are not employees and universities are exempt from paying wages, benefits, or recognizing union rights. However, this classification is also under increasing legal scrutiny after the ruling Johnson vs. NCAA, where the court found that college athletes meet the legal definition of employees under the Fair Labor Standards Act. This is the pivotal issue that may force legislators’ hands if such a judicial decision stands.
In its current state, NCAA college sports are totally unmanageable. Any decentralized attempt to impose control or create uniform guidelines at the NCAA, state, or university levels results in a spate of costly lawsuits.
Like it or not, college sports are headed for an antitrust exemption, maybe in the next year. It is clear that such a deal would fall under the NCAA banner with a commission(er) and is sure to include a student-athlete collective bargaining arm, similar to the NFL and MLB players’ association. An antitrust exemption allows certain activities that would normally be illegal under competition laws (price fixing, monopolies) to shield groups or organizations from challenges to practices that restrict competition but are deemed in the public interest. It takes the public good into account while allowing limitations to regulations controlling wages, markets, and pricing.
The solution is clear. However, the exact details and path to get there are certain to be choppy and uneven.