The NCAA had long prohibited the usage of student-athletes being paid for their name, image, and likeness (NIL). That changed in 2021 when Congress passed a bill granting student-athletes across all divisions in college athletics to receive compensation for their NIL.

In a memo released on May 27 to every university under the NCAA, the concept of NIL has changed even more. Before, some states had passed laws prohibiting universities from running collectives to operate NILs for student-athletes. Now, the NCAA told its member schools that they don’t have to follow state NIL laws.

The memo, which Sports Illustrated’s Ross Dellenger shared in a tweet, addressed commonly asked questions regarding NIL and the rules surrounding its usage. Billy Hawkins, a professor specializing in the area of sociocultural aspects of sports and physical activity at the University of Houston (UH), thought this memo was too late in a sense for the NCAA to gain some control over states.

Hawkins is working on a study at UH that provides a demographic representation across all NCAA institutions on who is receiving NIL endorsements and what all athletes at all sports are benefiting from the NCAA legislation. The study will be published by the end of this year.

“I think they’ve waited too long in terms of putting forth NIL policy–name, image, and likeness policy–and that allowed the states to get ahead of them,” Hawkins stated. “And once the states got ahead of them, it’s hard not to develop any policy that’s going to address the various schools throughout the nation because each state has varying types of policies: some are much more permissive, some are restrictive.”

NCAA representatives did not respond to requests for comment.

Background

Looser NIL laws could prove beneficial on the recruiting trail, and help drag higher profile recruits out of state. Daniel Sailofsky, a kinesiology and physical education professor at the University of Toronto, feels that the state lawmakers may be signing looser NIL laws for possible political gain, like reelection.

“I think that for some of them it is a political play in the sense that college football is king in certain states, and they want to make it easier for their schools to recruit high-level talent, and if that results in a winning program that could look good for them politically,” Sailofsky stated.

According to FAU Athletic Director Brian White, the university is not planning to change its operations.

“We have operated within all NCAA rules / guidelines as well as Florida state laws and our intention is to continue to do that into the future,” White wrote in a statement.

According to the memo, any entity tied to the university or institution must be “subject to the same NIL scrutiny as the institution and must adhere to NCAA rules and policy.” Additionally, boosters are not to use NIL to recruit “progressive student-athletes” to a certain institution, and that universities are not allowed to give incentives to boosters like suite access and tickets, which talks about collectives. A booster is someone who donates money and resources to support a collective.

The final, notable question that was asked in the memo was what the NCAA would do if a university in a state that prohibits NIL use violates the NCAAs regulations. The answer: “NCAA rules are adopted by member schools…Unless and until the membership changes a particular rule, all schools, as part of a voluntary membership, are required to comply.”

Which means, if a state law prevents a university from using NILs, the university can override that state law and follow the NCAA’s NIL rules because those schools voluntarily joined the NCAA.

“Well, the most important section to me was that the NCAA apparently believes that its member schools can, essentially, flaunt state laws and that its own cartel rules supersede legislation authority, which is rather astonishing,” said Ted Tatos, an economics professor at the University of Utah.

Campus collectives

Universities quickly enacted collectives, a place that helps the student-athletes facilitate and manage their NIL deals, when NILs became legal.

FAU Owl Collective founder Bryan Rammel said in January that the formation of collectives when NIL were legalized was “the wild, wild west.”

Now that NIL is legal, in such an abrupt and short amount of time, it is still unclear to some schools and states about how to proceed. 

Per FAU Athletics, both the Paradise Collective and the Owl Collective have some ties to the athletic department. Paradise Collective representatives did not respond to requests for comment. The founder of the Owl Collective, Bryan Rammel, spoke about how the memo may not impact them, but will follow what FAU will do.

“We will follow whatever the FAU athletic program wants to be followed… That’s our stance on it: we’re here to support FAU athletics however we can, and we want to do so in a compliant way that everybody feels comfortable with,” Rammel said.

Other states’ efforts

State lawmakers in Arkansas, Texas, and Oklahoma are pushing to loosen NIL rules, as each state will have a university playing in the Southeastern Conference, which many experts consider to be the highest level of college football in the nation.

Matt Brown mentioned how representatives of schools within the NCAA are continuing to push for a federal law, eliminating the idea of what he quoted as “‘pay-for-play’”.

“They don’t want to be sued for breaking state law, they don’t want to be sued for breaking antitrust law, so all they can do is write memos and hope they can scare people into compliance…” said Matt Brown, a publisher of Extra Points, a newsletter for college sports business. “It’s why the head of the NCAA and why major conference commissioners and many athletic directors are asking the federal government to pass a NIL law to make it a national law that would supersede all of these state laws and allow some kind of enforcement mechanism, because without one, there really isn’t anything the NCAA can do with any of this shit.”

Brown explains that is why the NCAA hired Charlie Baker, a governor from Massachusetts, as their new commissioner in December 2022.

Several Texas universities have publicly stated that they will instead follow their state NIL laws. The schools could face certain punishments, including bans, if they choose to disobey the NCAA’s memo and follow state laws. 

“My advice would be if there’s a conflict between the two things, you should follow your state law,” Brown said. “To be fair, the state law doesn’t mandate how that school runs their NIL collectives out of the fundraising arm, it simply gives permission to do so. But, I mean, the NCAA doesn’t have subpoena power. If you’re a public school, then the state that gives you all the money to operate, you should do what the state tells you to do.”

Sailofsky sees that states are trying to “get ahead of this new product.” He later compared what is happening now with NIL and A.I. 

“The same way that when there is new A.I. that appears, legislation is created to try to deal with it right away. So, some of it is more of a practical thing and I think some of it is a political ‘let’s try to get good talent in here and then we can win some games and that will increase our political chances’ thing.”

Looking forward

While some experts believe that this could lead Congress potentially getting involved, others don’t see that happening. 

“I don’t think it changes shit because it’s just an email,” replied Brown. “People can ignore it.”

Even Dan Cornely, who runs the master’s program in Sports Management at Florida Atlantic University, gave his take.

“I don’t think it’s going to have this extreme, monumental change that we are going to see this huge shift in the landscape because NIL deals are already going on and that is not going to change,” Cornely said.

Tatos hypothesized that the NCAA is attempting to prohibit NIL deals for profit. Tatos gave an example of how a company like Nike would sign a deal with a university to have their players wear their brand, whereas an individual athlete can wear that brand and get that money from them. 

“So, Nike signs a deal with, let’s say, Duke, with UNC, because it wants their shoes to be on the athletes, right? As opposed to the NBA, where you have athletes signing their own deals…So, what the companies themselves want is access to the individuals, but by prohibiting the free market there, the schools were able to take away those profits themselves.”

Almost all that the UP spoke with believe that this could lead to Congress intervening between the states and the NCAA.

“My hope will be that NIL is a step towards full unionization and paying these athletes as workers, which is what they actually are,” Sailofsky said. 

Maddox Greenberg is the Sports Editor for the University Press. For information regarding this or other stories, email [email protected] or DM via Twitter @MaddoxGreenberg and Instagram @maddoxblade04.