A proposed bill in the California state legislature poses a significant economic threat to the landscape of NCAA sports, specifically those that don’t generate revenue.
Assembly Bill 252, also known as the College Athlete Protection Act, aims to create a revenue-sharing arrangement between schools and student-athletes that compete in revenue-generating sports.
Similar to how the development of name, image and likeness (NIL) policies in 2021 has changed the NCAA landscape by allowing student-athletes to be compensated financially for endorsement purposes, AB 252 would also result in a seismic change in the industry.
The author of the bill, former SDSU basketball player and assembly member Chris Holden, worked closely with the National College Players Association (NCPA), the athlete-advocacy group that helped push the development of NIL, in crafting AB 252.
The stark difference between NIL and AB 252 is that, while NIL allows student-athletes to be compensated for promotion and endorsement opportunities from the private sector, AB 252 would see revenue funneled directly from the school to the student-athlete.
“At some point we have to recognize that what’s demanded of these athletes far exceeds what the average student is expected to contribute,” Holden said last month.
“We owe it to these young people to put protections in place that match the unique position they are in and set them up for success post schooling.”
The bill would require each Division I institution in the state to establish a “degree completion fund” in order to pay their scholarship athletes “fair market value,” defined by the bill as an equal share of half their team’s annual revenue, minus the cost of the athlete’s grant-in-aid.
The amount of money each student-athlete would receive would depend on the revenue generated by each specific team, but could see them receiving $25,000 annually and “have more than $100,000 waiting for them upon graduation,” according to The Orange County (OC) Register).
The revenue targeted by AB 252 is currently used for athletic department operations. This money funds things such as recruiting budgets and coaching salaries for major sports such as football and men’s basketball, but also helps supports other programs, including swimming and diving, that don’t turn a profit.
The University of California (Cal, UCLA, etc.) and California State University (San Jose State, San Diego State, etc.) have both opposed the bill, stating that they believed AB 252 would result in the elimination of non-revenue sports, along with having serious ramifications on Title IX.
AB 252 is also opposed by the United States Olympic & Paralympic Committee (USOPC), with the organization’s Athlete Advisory Council (AAC) saying it “positively impacts a few athletes in revenue-generating sports to the detriment of many.”
Team USA Your Voice Matters:
CA Assembly Bill 252, which attempts to redirect athletic funding to student-athletes participating in sports with market value (football & basketball), could result in loss of Olympic sports on campus
For more info- https://t.co/QPXNppf8Rd pic.twitter.com/hOdt6qi6eQ— USOPC AAC (@USOPC_AAC) April 12, 2023
There are still a number of hurdles the bill has to pass in order for it to come to fruition anytime soon, according to The OC Register). AB 252 passed the California State Assembly’s higher education committee in April by an 8-3 vote, which moves it to appropriations. It would still need to:
- Pass appropriations by May 19 in order to reach the assembly floor during this legislative cycle (two-year cycles). Holden, the author of the bill, is the chair of the appropriations committee.
- If it passes appropriations, AB 252 would then need to pass the full assembly by June 2 in order to advance to the senate this year.
The appropriations committee has scheduled a hearing on AB 252 for Thursday.
Have two sides of the athletic department; Revenue and Non-Revenue. Revenue sports are all self-sustaining including scholarships and the wages the football and basketball players receive. All other sports are funded like Division III schools through tuition and fees revenue. Since all the football and basketball scholarships will be paid out of the revenues from their ticket sales, tv revenue share and the other revenue sources, the universities can use the scholarship money saved from football and basketball to fund the other non-revenue sports.
Conversely then, if the athletics program loses money (and a lot do), student athletes should be required to pay to keep the program afloat as revenue sharing should always be symmetrical.
Profit =\= revenue
I’m all for student-athletes making money, so I’m in favor of NIL. I’m not in favor of forcing universities to pay student-athletes. Let the free market work. If an athlete is good enough to be paid, they can weigh all packages (NIL, scholarship, whatever money a university *chooses* to pay, prestige of the program, future earning potential, etc) then they can decide on the best deal given their goals. If a university in California wants to support Olympic sports, let them! Maybe one thing we can agree on: stop paying college football coaches that consistently lose games $millions per year.
Also, I’m concern that other athletes that can’t make money don’t lose their full or partial scholarships. Good is already very expensive to begin with
Maybe Chris Holden should listen to his alma mater when it comes to this decision.
Given the Supreme Court stripping the NCAA of most of their power to enforce many rules in the NIL/Player Compensation space, we get left with this. If not California, it will be somebody else. Revenue generating sports want to keep their revenue and they will continue to look for ways to do so. Although I have no great love for the NCAA, those who wish to blow it up should consider that the thing that comes next could be some very commercial entity and the NCAA could be considered the good-ole days by non-revenue sports… I hope I am wrong, but…
Ive been saying it for years and I’ll say it again. Require all federally funded schools (essentially any public school and most private schools) to put 50% of their athletic budget toward Olympic sports. end the ASA. An amendment like this would mean up to 50% of the income would be siphoned to non-revenue sports.
Why? Why do small sports deserve all that money?
I think it goes to the mission of public universities. To the extent the athletic department has a budget, it should be used to open up opportunities for many more student athletes than just those that play revenue generating sports. Private schools might have different missions.
Well if you dont want to save them stop pissing and moaning about the death of Olympic sports!
This would get shut down by the Supreme Court in an instant due to a Title IX violation
California finds a way to screw up everything
I love my home state (the geography & people), but I can’t stand when we pull stuff like this. We have way huger problems to solve like the homelessness crisis and the housing crisis we but refuse to do take meaningful steps to solve them.
Spoiler alert, Sacramento is not going to do a thing about housing and homelessness. As a matter of fact, the problem is accelerating. The NIMBYs would never allow the zoning and law changes required to even begin to address the above issues.
But Los Angeles is: https://www.politico.com/news/2023/02/04/karen-bass-los-angeles-homelessness-00081190