Skinner seeks NIL transparency with new bill

For Sen. Nancy Skinner (D-Oakland) the effort to ensure college athletes are fairly compensated for their hard-earned stardom in competition is still game on.

After effectively rewriting the rules of American college athletics with her SB 206 in 2019 – a bill that made California the first state to give student athletes the right earn money from the use by their schools of their name, image and likeness (NIL) – Skinner has introduced new legislation (SB 906) seeking to bring some transparency to what has become a Gold Rush for some college athletes and their schools.

The original NIL law allowed college athletes in the Golden State to be legally compensated for endorsing products or appearing in advertisements (among other things), granting them the chance to share in the enormous revenues colleges make from athletics. It also instantly gave California a distinct advantage when recruiting the best athletes: come here, get paid.

Skinner successfully shepherded another NIL-related bill into law as well, following up her original 2019 bill in 2021 with SB 26, which accelerated California’s adoption of NIL rules and expanded it community college athletes.

Not surprisingly, fanbases across the country were not going to stand for schools like USC, UCLA, Cal and Stanford having a leg up in the year-found fight for new talent. So, scores of state legislatures across the country quickly followed Skinner’s lead and passed similar NIL bills of their own, changing the way college sports operate.

The biggest of those changes has been the creation of something known as “collectives,” private entities loosely – though not directly – connected to universities to facilitate NIL deals for college athletes. Collectives have in very short order have become central figures in the recruitment of high school stars and transfers.

Notable collectives include Yea Alabama, which primarily supports the University of Alabama’s dominant football team; Texas Aggies United, which also primarily supports a Texas A&M football team desperate for big wins; and The 1890 Initiative, which (you guessed it) primarily supports a once-powerful but now struggling Nebraska football team looking for any wins at all.

As Skinner noted in a press release announcing the introduction of SB 906, “To date, these collectives have formed predominantly to support men’s college football and basketball players.”

The biggest of those changes has been the creation of something known as “collectives,” private entities loosely – though not directly – connected to universities to facilitate NIL deals for college athletes. Collectives have in very short order have become central figures in the recruitment of high school stars and transfers.

A glance at the listing of NIL collectives on the college sports news site On3, which specializes in college recruiting news, makes that abundantly clear. There are, for example, three such collectives listed for the defending NCAA football champion Michigan Wolverines. All three list football as their primary focus.

Skinner says she did not initiate the NIL gold rush just to benefit male athletes. She wants to ensure that female athletes are benefiting from this new world as well.

However, anecdotally, she and her staff have heard that some female athletes have done quite well for themselves under the new NIL regime, just not with the help of collectives. Indeed, Haley and Hanna Cavinder, twin women’s basketball stars at the University of Miami, reportedly earned close to $2 million in NIL deals. Iowa women’s basketball star Caitlin Clark appears in a State Farm commercial with current NBA star Jimmy Butler and Hall of Famer Reggie Miller that you might have caught on television recently.

So, Skinner’s strategy with SB 906 is to begin collecting data on NIL to see how student athletes of both genders are faring.

“What allowing athletes to have rights to their Name, Image and Likeness did in the best of cases is allow an athlete to monetize that skill and talent they have,” Skinner told Capitol Weekly. “But what we’ve seen – and it isn’t surprising because college athletics is a multibillion-dollar operation in the U.S. – is some interests [have said], ‘Let’s figure out how to use NIL to benefit our college.’ So you have these collectives, mostly created by boosters or alums or whatever that want to attract the best athletes to their school.

“So, OK, fine, but are you doing that in a fair manner? Is that benefiting women athletes just as well? Is it benefiting swimmers and track stars? Or is it only benefiting basketball players?”

If it turns out that female athletes are indeed profiting at a roughly equitable rate with male athletes, just not under the auspices of collectives, Skinner and staff may not see any need for further legislation.

But first she wants to see the lay of the land, which is where SB 906 comes in. The bill would require any entity that enters into an NIL deal with a college athlete to provide basic information about the deal to the college or university the student attends. This would include collectives as well as businesses that make direct deals with student athletes.

“What the bill does is by the transparency it gives us the information,” Skinner said. “Gives colleges the information, the public the information, policymakers the information – how those boosters are using it, using the NIL, how they’re distributing the money. And then, once we have the information, we can see whether there is a legitimate next step, policy-wise, or whether colleges need to start paying attention to Title IX or what have you.”

Under the bill, entities entering into NIL deals with student athletes would be required to report to the student’s university:

• the amount of money or other compensation paid to the student and his or her immediate family,
• the athletic team for which the student plays or is expected to play and
• the student’s gender.

Notably, the entities would not be required to report to the universities the specific identity of the student athlete they’re working with. The universities, however, would be required to aggregate the total amount of compensation provide to all student athletes at their institution each year by sport and gender.

SB 906 would then make all of that data public information.

If approved by the legislature and signed into law, SB 906 would only apply to California universities and student athletes. Skinner’s staff isn’t sure if other states will be in quite the same rush to follow this bill. But there’s hope that other blue states might, and that would begin to shed light on gender equity in the distribution of NIL funds.

And certainly if the information collected by the bill reveals Title IX violations, Skinner would want to see action taken. In December, a lawsuit was filed against the University of Oregon athletic department alleging Title IX violations tied to NIL – which just furthers concerns that the application of NIL could run afoul of the equities Title IX attempts to ensure.

“There is a coming collision because the people who are implementing NIL are talking about how this is the wild, wild west, and that they can do anything thing that they want,” Arthur H. Bryant, a partner at Bailey Glasser, told law.com. “And no they can’t. If they violate Title IX, there is a law there.”