NCAA NIL subcommittee now tasked with developing a Plan B

At the two-year anniversary of the NIL Era, industry leaders are increasingly voicing one question: If the NCAA‘s efforts to secure a federal NIL bill fall short, what is Plan B?

Now the NCAA’s NIL subcommittee has in fact been tasked with exploring a Plan B in case Congress does not act by passing a federal NIL bill. The NCAA Division I Council received updates on the work of the NIL subcommittee last Tuesday and Wednesday at NCAA headquarters in Indianapolis, a source with direct knowledge of the meetings told On3.

The purpose of the meetings – attended Tuesday and Wednesday by first-year NCAA President Charlie Baker – extended beyond merely discussing NIL-specific guidance and interpretation. Rather, the source said, the purpose was to develop details around an NIL-specific proposal in case Congress doesn’t act to pass a federal NIL bill.

The source, who spoke on condition of anonymity because of ongoing discussions, stressed the meetings do not reflect a pivot in strategy by the NCAA. The NCAA will continue to aggressively lobby Congress for a federal NIL bill while the subcommittee – also known as the NIL Working Group – explores potential backup plans.

A larger stakeholders meeting is expected to occur at the end of July in Indianapolis to solicit additional feedback on a potential draft of an NIL-specific proposal. That could be in the form of a draft of a federal bill to present to Congress or new overall NIL-specific guidelines. Specific elements that will be included in a potential NIL proposal remain unclear. 

‘We do need a Plan B and C’

Last week’s meetings were also important because the NCAA is working to show Congress that the membership can govern the association, the source said, but it needs federal assistance considering the numerous and disparate state laws impacting NIL. For example, it was revealed Monday that New York became the latest state that passed signed sweeping NIL reform on the local level aimed directly at bypassing oversight by the NCAA.

The pros and cons of a potential revenue-sharing model were not addressed. Nor was a potential employee model. The conversation remained narrowly focused on NIL. The tenor of the open dialogue was “relatively quiet” on Tuesday, the source said, adding that on Wednesday, more robust discussion ensued, as all stakeholders continue to navigate an array of NIL-related issues. 

“There was not one person in the room who is not dealing with something related to name, image and likeness,” the source said. “This was the opportunity for everyone to state their case. Some [dialogue] was blunt.”

Baker, the former Massachusetts governor, said last month he ideally would like to see a federal bill passed by the end of the calendar year. Stakeholders know the clock is ticking with the election cycle fast approaching. And it had not been clear that the NCAA was exploring a Plan B.

“I haven’t heard anybody talking about a Plan B now,” Bubba Cunningham, North Carolina‘s athletic director, recently told On3. “Hope we have people working on that. We do need a Plan B and C. 

“And what does it look like: Do we go to a revenue-sharing model for some of our teams? Do we go to need-based models for the majority of our teams? What impact do all of these conversations have on the Olympic movement?”

What does the NCAA want with an NIL bill?

Although Baker began his tenure in March, the NCAA has been lobbying Congress for four years. More than a dozen bills have been proposed. None has even gone to a vote. There are five primary bill proposals whose drafts have been circulating. Here is a synopsis of each.

Democrats typically want a broader bill. Republicans are pushing for a more narrowly focused one. There is little consensus. Florida Republican Rep. Gus Bilirakis, who proposed a narrowly focused bill, told On3’s Pete Nakos, “You know how government works. You gotta build consensus. I work on both sides of the aisle and have a reputation of getting things done. I want to make this a priority to save the integrity of college sports.”

The association’s federal bill wish list includes three main items: A uniform national NIL standard; at least limited antitrust protection and a formal federal designation that student-athletes are not employees of their schools, conferences or the NCAA.

On the NIL front specifically, Baker has said that a registry of NIL deals, a certification process for agents and a uniform NIL standard are among the priorities. The NCAA wants a federal NIL bill that preempts state NIL laws, which have become increasingly bold and progressive in giving in-state schools competitive advantages. 

In fact, state NIL laws recently passed in Arkansas, Colorado, Missouri, Montana, New York, Oklahoma and Texas are ushering in a new phase in the two-year-old NIL Era. 

The Texas state law, for instance, allows schools’ fundraising foundations to provide priority points to donors who contribute to the school-affiliated collective. That collides with NCAA rules. And the Lone Star State law provides protection for in-state schools from the NCAA policing NIL activity. Texas A&M and Texas Tech have introduced models that more closely tie their school fundraising arms with collectives. 

‘We don’t have to invite you to NCAA championships’

Other schools will likely follow suit. Steve Hank is the executive vice president of collegiate athletics at Affinaquest, the leading data management company in college sports. Both A&M and Tech are clients. When Hank talks with other clients these days, there is one common question: “Can we do it?”

The NCAA issued a memo last week that said member schools must “adhere to NCAA legislation (or policy) when it conflicts with permissive state laws.” But Texas A&M indicated it will follow state NIL law instead of NCAA policy. What happens next could ignite a legal clash.

“The NCAA is a voluntary organization,” the source said. “If [schools in] Texas want to go way outside the guidelines and say, ‘We don’t have to follow NCAA rules,’ the NCAA can say, ‘We don’t have to invite you to NCAA championships either.'”