Should universities share athletics revenue with players? California bill sparks backlash
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For four years, Stanford student Liam Anderson has gone to what he calls his “full-time job.” He puts on his uniform, laces up his shoes and just runs. As captain of the Stanford track and field team, the public policy major has put in 20 to 40 hours of running, conditioning and physical therapy each week — a pace he’ll continue when he returns to campus this fall to pursue his master’s degree.
It’s a lot of time away from academics, with little financial reward, which is partly why Anderson has been supporting and advising California lawmakers on new legislation that could dramatically alter college athletes’ compensation.
“This is the only labor market where the primary labor input — the players — receive essentially zero compensation from their employers,” Anderson said. “It is very difficult on a philosophical level to argue that these players do not deserve some form of compensation. To say a scholarship is enough is laughable.”
Assembly Bill 252, or the College Athlete Protection Act, would require California colleges to put some of their sports revenue into a fund that would pay student athletes when they complete their degrees. Athletes could earn as much as $25,000 for each year they participate in their sport.
But the bill has been controversial. Last week, its author, Assemblymember Chris Holden, put it on hold until next year after opponents — including the University of California, California State University and Team USA — argued it would further prioritize men’s basketball and football, causing campuses with tight athletic budgets to divert resources away from less lucrative sports. The NCAA has also opposed it.
Supporters say the first-in-the-nation bill, which the state Senate could take up again as early as January, bolsters athletes’ rights by giving them a cut of the revenue they generate. It’s the latest flashpoint in the debate over student athlete compensation, in which California has played a leading role.
As written, the bill would also require colleges to comply with a variety of health and safety standards, including paying all out-of-pocket health care costs for athletes injured on the field, and providing players with financial and life skills training. Sports agents seeking to represent student athletes would need to be certified by the state. A 21-member panel appointed by the Legislature and governor, with seats set aside for former college athletes, would oversee compliance.
The degree completion fund, however, has drawn the most attention since it would be a further blow to the amateurism model in college sports. California already catalyzed change within the NCAA when it allowed student athletes to make money off their name, image and likeness. NCAA policy now permits athletes to sign endorsement deals, but that money comes from private sponsors rather than the universities themselves. Athletes receiving it would be eligible for the degree completion funds, too.
Combined, California’s 26 Division I schools earned $1.2 billion in revenue in fiscal year 2022, according to the U.S. Department of Education. That includes media contracts, ticket sales, investment interest income, student activity fees and alumni contributions.
“Revenue is being generated. There are TV rights that are being negotiated for someone to make a lot of money, and it is not the student athlete,” said Holden, a Pasadena Democrat who played college basketball for San Diego State from 1978 to 1982.
“This is an opportunity to really recognize the kind of sacrifices that many of these athletes put on the line on behalf of universities and the NCAA, institutions that make billions of dollars,” Holden added.
Money for the degree completion fund would come from a university’s existing athletic revenue. Beginning in 2024, if an athletic department makes more annual revenue than it did in the 2021-22 academic year, the difference would be deposited in the fund. Athletes’ payments would depend in part on how much revenue their sport generates and how much their team already gives out in athletic grants.
Football and men’s basketball make up a majority of revenue brought in by athletic departments, and some of those funds currently go to subsidize other sports. That caused some supporters of those lower-revenue sports — such as swimming and volleyball — to worry that the bill would sap much-needed funding from their programs.
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