Trump signs executive order laying out new rules for NIL deals and money in college sports
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Trump signs executive order laying out new rules for NIL deals and money in college sports
President Trump signs executive order on college sports. It seeks to ban “third-party, pay-for-play payments to collegiate athletes” It also says revenue-sharing arrangements between universities and athletes should expand or preserve “scholarships and collegiate athletic opportunities in women’s and non-revenue sports” The NCAA says it “appreciates the Trump Administration’s focus on the life-changing opportunities college sports provides millions of young people” The White House calls college sports an “out-of-control, rudderless system,” but it’s not clear how the order will be enforced.”Absent guardrails to stop the madness, many college sports will soon cease to exist,” Mr. Trump’s executive order states. “The NCAA is making positive changes for student-athletes and confronting many challenges facing college sports,” the NCAA says.
The executive order seeks to ban “third-party, pay-for-play payments to collegiate athletes,” while still allowing athletes to strike brand endorsement deals. It also says any revenue-sharing arrangements between universities and athletes should expand or preserve “scholarships and collegiate athletic opportunities in women’s and non-revenue sports.”
Mr. Trump’s order also said schools with more than $50 million in athletic revenue cannot reduce the number of scholarship opportunities for “non-revenue sports” — typically sports other than football and basketball. Schools that draw more than $125 million are directed to increase their non-revenue scholarships in the coming academic year.
The president also directed the National Labor Relations Board to work on “clarifying the status of collegiate athletes” — likely referring to moves by some college athletes to be deemed university employees and form labor unions.
It’s not clear how the order will be enforced. Mr. Trump tells top administration officials to “develop a plan” within 30 days to advance the order using “all available and appropriate regulatory, enforcement, and litigation mechanisms.” It floated decisions about federal funding, Title IX enforcement and work with Congress.
CBS News was first to report on Mr. Trump’s plan to sign a college sports-focused executive order last week.
In recent years, collegiate sports have been reshaped by drastic policy changes that allow student-athletes to make millions of dollars while still in school.
The NCAA in 2021 permitted athletes to earn money for the use of their name, image and likeness, or NIL. Since then, some big-name student-athletes have scored the types of lucrative brand endorsement deals that were once more closely associated with professional athletes.
Rules restricting schools from directly paying athletes have also been loosened. A legal settlement involving the NCAA earlier this year allowed schools to start sharing revenue with athletes for the first time, and the Supreme Court ruled in 2021 that the NCAA’s attempts to limit some benefits to athletes violated antitrust law.
The changes mark a stark departure from college sports’ previous operating model, in which athletes were thought of as amateurs and were paid in college scholarships. That system faced stiff criticism from many student-athletes, who viewed it as unfair to block them from being compensated even as their work, in some cases, brought in millions of dollars for their schools.
But the new landscape has also drawn fears about whether smaller colleges will struggle to compete with their larger peers’ checkbooks, and whether sports that don’t generate much revenue for colleges will face more pressure. And fans of certain schools have formed so-called NIL collectives that draw in donations and offer endorsement deals to players, an arrangement some critics have called a “pay-to-play scheme.”
“Absent guardrails to stop the madness and ensure a reasonable, balanced use of resources across collegiate athletic programs that preserves their educational and developmental benefits, many college sports will soon cease to exist,” Mr. Trump’s executive order signed Thursday states.
Meanwhile, most states have passed their own laws regulating NIL, but the federal government doesn’t have a uniform standard. This week, a House committee advanced the SCORE Act, which would set national NIL rules. But there’s concern that the bill doesn’t do enough to protect athletes’ interests.
The NCAA said in a statement after Thursday’s executive order that it “appreciates the Trump Administration’s focus on the life-changing opportunities college sports provides millions of young people.”
“The NCAA is making positive changes for student-athletes and confronting many challenges facing college sports by mandating health and wellness benefits and guaranteeing scholarships, but there are some threats to college sports that federal legislation can effectively address and the Association is advocating with student-athletes and their schools for a bipartisan solution with Congress and the Administration,” NCAA President Charlie Baker said in a statement.
Trump signs order to clarify college athletes’ employment status amid NIL chaos
President Donald Trump signs an executive order on college sports. The order does not provide or suggest specifics on the controversial topic of college athlete employment. The move comes after months of speculation about whether Trump will establish a college sports commission. The NCAA has been lobbying for several years for limited antitrust protection to keep some kind of control over this new landscape, but a handful of bills have gone nowhere in Congress.“It is common sense that college sports are not, and should not be, professional sports, and my administration will take action accordingly,” Trump says. “We’ve gotten to the point where government is involved. Obviously, there’s belief it needs to be involved,’’ Big Ten coach Barry Odom says of the Trump order at a press conference in Las Vegas. ‘The game’’s been around for a hundred years and it’s going to be around 100 more,’ he says of college football’s future in the U.S., he adds.
Trump directed the secretary of labor and the National Labor Relations Board to clarify the status of collegiate athletes through guidance or rules “that will maximize the educational benefits and opportunities provided by higher education institutions through athletics.” The order does not provide or suggest specifics on the controversial topic of college athlete employment.
The move comes after months of speculation about whether Trump will establish a college sports commission to tackle some of the thorny issues facing what is now a multibillion-dollar industry. He instead issued an order intended to add some controls to “an out-of-control, rudderless system in which competing university donors engage in bidding wars for the best players, who can change teams each season.”
“Absent guardrails to stop the madness and ensure a reasonable, balanced use of resources across collegiate athletic programs that preserves their educational and developmental benefits, many college sports will soon cease to exist,” Trump’s order says. “It is common sense that college sports are not, and should not be, professional sports, and my administration will take action accordingly.”
There has been a dramatic increase in money flowing into and around college athletics and a sense of chaos. Key court victories won by athletes angry that they were barred for decades from earning income based on their celebrity and from sharing in the billions of revenue they helped generate have gutted the amateurism model long at the heart of college sports.
Facing a growing number of state laws undercutting its authority, the NCAA in July 2021 cleared the way for athletes to cash in with NIL deals with brands and sponsors — deals now worth millions. That came mere days after a 9-0 decision from the Supreme Court that found the NCAA cannot impose caps on education-related benefits schools provide to their athletes because such limits violate antitrust law.
The NCAA’s embrace of NIL deals set the stage for another massive change that took effect July 1: The ability of schools to begin paying millions of dollars to their own athletes, up to $20.5 million per school over the next year. The $2.8 billion House settlement shifts even more power to athletes, who have also won the ability to transfer from school to school without waiting to play.
At Big Ten Conference football media days in Las Vegas, Purdue coach Barry Odom was asked about the Trump order.
“We’ve gotten to the point where government is involved. Obviously, there’s belief it needs to be involved,” he said. “We’ll get it all worked out. The game’s been around for a hundred years and it’s going to be around 100 more.”
The NCAA has been lobbying for several years for limited antitrust protection to keep some kind of control over this new landscape — and avoid more crippling lawsuits — but a handful of bills have gone nowhere in Congress. Trump’s order makes no mention of that, nor does it refer to any of the current bills in Congress aimed at addressing issues in college sports.
NCAA President Charlie Baker and the nation’s largest conferences both issued statements saying there is a clear need for federal legislation.
“The association appreciates the Trump administration’s focus on the life-changing opportunities college sports provides millions of young people and we look forward to working with student-athletes, a bipartisan coalition in Congress and the Trump administration,” said Baker, while the conferences said it was important to pass a law with national standards for athletes’ NIL rights as soon as possible.
The 1,100 universities that comprise the NCAA have insisted for decades that athletes are students who cannot be considered anything like a school employee. Still, some coaches have recently suggested collective bargaining as a potential solution to the chaos they see.
It is a complicated topic: Universities would become responsible for paying wages, benefits, and workers’ compensation and schools and conferences have insisted they will fight any such move in court. While private institutions fall under the National Labor Relations Board, public universities must follow labor laws that vary from state to state and it’s worth noting that virtually every state in the South has “right to work” laws that present challenges for unions.
Trump’s order also:
— Calls for adding or at least preserving athletic scholarships and roster spots for non-revenue sports, which are those outside football and basketball. The House settlement allows for unlimited scholarships but does impose roster limits, leading to a complicated set of decisions for each program at each school that include potential concerns about Title IX equity rules. Trump said “opportunities for scholarships and collegiate athletic competition in women’s and non-revenue sports must be preserved and, where possible, expanded.”
— Asks the Justice Department and Federal Trade Commission to “preserve college athletics through litigation” and other actions to protect the rights and interests of athletes — a stance that could influence ongoing lawsuits filed by athletes over eligibility and other issues.
— Directs White House staff to work with the U.S. Olympic and Paralympic Committee to protect the collegiate pipeline feeding Team USA. College sports programs produce around three-quarters of U.S. Olympians at a typical Summer Games, but some are on uncertain footing as schools begin sharing revenue with athletes and the lion’s share going to football and basketball.
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AP National Writer Eddie Pells contributed.
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Source: https://www.cbsnews.com/news/trump-college-sports-nil-deals-executive-order/