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Congressional hearing targets 'NIL chaos' in college sports

Posted at 10:43 AM, Mar 30, 2023

A congressional hearing Wednesday targeting “NIL chaos” in college sports drifted into the ramifications of athletes being deemed employees of their schools and mostly highlighted those who support congressional intervention to protect the collegiate model.

A subcommittee of the House Committee on Energy and Commerce held the first hearing related to college sports on Capitol Hill in more than two years.

The intended focus was name, image and likeness compensation for athletes. College sports leaders have been calling for help in the form of a federal law to bring uniform regulation to the way athletes can earn money off their fame with sponsorship or endorsement deals.

Rep. Gus Bilirakis (Fla.-R), the chairman of the subcommittee on Innovation, Data, and Commerce, said passing a federal NIL law that would pre-empt existing state laws would provide clarity and transparency for athletes.

“The lack of uniformity across different states and institutions has created confusion and uncertainty and a federal standard is needed, so all athletes are playing by the same rules,” Bilirakis said. “In short, we must strike a delicate balance between the rights of college athletes to profit from their own NIL while keeping the amateur status for all college athletes.”

Seven previous hearings have been held in the House and Senate, but lawmakers have made no significant progress toward passing a college sports bill since the topic first started gaining attention.

The latest hearing was held days before the Final Four in the NCAA men's and women's basketball tournaments were set to be played in Texas.

Lawmakers questioned six witnesses for nearly three hours. They heard from two college sports administrators, the president of a Division II university, a former NFL player, a current Florida State softball player and one of the leaders of an athletes’ advocacy group.

Most of the witnesses encouraged congress to act on NIL.

“We need transparency in the market place," Washington State athletic director Pat Chun said.

Jason Stahl, executive director of the College Football Players Association, pushed back. He said any NIL regulations would only serve the interests of schools, conferences and the NCAA.

“The federal government should stay out of the NIL free market,” he said.

The NCAA lifted its ban on college athletes earning money off their fame almost two years ago, but fear of lawsuits and a patchwork of state-level NIL laws steered the association away from putting in detailed and uniform rules.

“The current NIL chaos means student-athletes are left to fend for themselves,” said Rep. Cathy McMorris Rodgers (Wash.-R). “And those at the top of their game must figure out how to maneuver through a multiple of agents, collectives and high dollar contract offers all while maintaining their academic and athletic commitments.”

The concern among many in college sports is NIL is being used as a recruiting inducement or as de facto pay-for-play, which are still against NCAA rules but have become difficult to enforce.

New NCAA President Charlie Baker, who was not among the witnesses at the hearing, has said the athletes are the consumers in this burgeoning market and a federal law would be a form of consumer protection.

“NIL is a powerful vehicle that rightfully allows student-athletes the ability to earn compensation from their unique market value,” Baker said in a statement. “At the same time, the lack of transparency in today’s NIL marketplace puts student-athletes in jeopardy of exploitation by bad actors.”

The hearing also veered into the topic of college athletes being deemed employees and the possibility that colleges could be required to share with athletes the revenue generated by their sports.

At most Division I schools, revenue generated by football and basketball help fund all the other sports.

"The creation of an employee-employer model would significantly threaten this current dynamic and alter everything we know about how sports outside football and men’s basketball are supported," Florida State softball player Kaley Mudge said.

A bill introduced by a California state lawmaker in January would — if passed — require some Division I schools to share a percentage of revenue with mostly football and basketball players.

A federal lawsuit being heard in Pennsylvania seeks to make colleges treat Division I athletes like employees and start paying them an hourly wage. A complaint to the National Labor Relations Board could also lead to employee status being granted to some college athletes, which could open the door to unions.

“How does a football player unionize and a softball player doesn’t?” Chun said.

Patriot League Commissioner Jen Heppel, who testified before lawmakers, said in written testimony that Division I college athletes being deemed employees “would likely represent a breaking point for the sponsorship of athletic programs at Patriot League institutions.”