California could lead another charge in college athlete pay with its latest proposed bill

California sparked the birth of NIL money for athletes; now the state could take it a step further

In 2019, California Gov. Gavin Newsom signed the Fair Pay To Play Act, which prohibited the NCAA from punishing a student-athlete who profited off their name, image and likeness (NIL). With state law trumping NCAA rules, it meant any college athlete from a California school could make some money while playing.

Lawmakers from across the political spectrum in states all over the country quickly followed suit and passed their own bills. Courts upheld the legislation and NIL is now a major, if evolving, part of college athletics.

“California has been very effective at putting forth trailblazing legislation,” state Assemblymember Chris Holden said. “It makes sense and then catches on around the country.”

Well, California is back, this time with Holden, who serves Pasadena and spoke Thursday in front of the famed Rose Bowl, sponsoring a law that promises an even bolder change to how college sports operates.

The College Athlete Protection Act will begin working its way through committees with optimism among backers that it can find its way to Newsom’s desk this fall and be signed. (A similar bill failed last year).

CAPA takes a direct shot at the NCAA’s long-standing amateurism model by requiring schools to share profits from specific programs with its athletes, particularly those who graduate.

California Assemblymember Chris Holden discusses a proposed bill that aims to expand college athlete payment beyond NIL. (AP Photo/Beth Harris)
California Assemblymember Chris Holden discusses a proposed bill that aims to expand college athlete payment beyond NIL. (AP Photo/Beth Harris)

The bill requires schools to share up to 50% of revenue with athletes who compete in programs that bring in twice as much in revenue as they spend on athletic scholarships.

At many places this would include only football and men’s basketball, although women’s basketball, gymnastics, ice hockey, volleyball and other sports can reach that threshold at certain schools.

Current student-athletes' pay would be capped at $25,000 per year while they're in school, but colleges would be required to set aside an equally divided 50% of revenue annually to be paid out upon completion of a degree within six years. At major football programs, such as USC, that could equal about $200,000 a year per player — or $800,000 for a four-year career, according to some estimates.

Part of what doomed the bill last year were concerns that by paying football and basketball players, athletic departments would lack the resources to continue to fund scholarships or even entire teams in non-profitable sports. This time, in an effort to prevent such cuts, there is a second funding option.

A school that sees an increase in revenue — even a small amount — can allocate 50% of the so-called “new money” to pay the athletes in those sports. This would likely result in far less money for athletes, if any at all, but it's still considered progress

It is also the way, proponents argue, that existing budgets aren’t strained to the point of pulling back opportunities for others. USC and UCLA, for example, are about to enter the Big Ten Conference where millions in new money is awaiting. That increase in revenue could save those schools money under the new bill.

“Even though it won't make the athletes whole, it will represent progress for those athletes,” said Ramogi Huma, a former UCLA football player and now president of the National Collegiate Players Association.

The bill also calls for a three-year ban for any athletic director who cuts teams or scholarships under these circumstances.

There are additional provisions and CAPA could be beefed up or stripped down as it goes through the legislative process.

If it were to pass, it will likely be duplicated by other states, if only out of competitiveness. After the NIL bill passed in 2019, there was a fear that California schools would enjoy a significant recruiting advantage — why not go play where you can earn more than just a scholarship?

States began to match or even write more forgiving laws in an effort to outdo not just California, but states with rival programs. Others have sat it out and watched as the NCAA has been essentially powerless to stop all kinds of payments to players and recruits. Public sentiment has quickly swung against the NCAA and amateurism.

CAPA may be slightly less pronounced of an advantage. NIL opportunities anywhere can offset the graduation payment, which in and of itself is a delayed payout that may not hold the recruiting sway of an immediate deal.

That said, it is a full-throttle attack on the concept of amateurism, which the NCAA has clung to long after other international sports organizations, most notably the Olympics, have given up. This would feature schools making direct payments to players — an addition to scholarships, academic awards and Pell Grants that are already allowed.

Back in 2019, many in college sports ignored the actions of the California Assembly, only to see its impact quickly sweep over football and basketball. No one should make the same mistake this time.

Precisely how this will play out isn’t known, but if it passes as some expect it, college sports will be forever altered, perhaps significantly.