California Senate Passes Bill for Increased Transparency in College Athlete NIL Deals

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The California state Legislature last night passed SB 906, a bill introduced by Senator Nancy Skinner (D-Berkeley). The legislation, which seeks to shed light on the Name, Image, and Likeness (NIL) deals in college sports, received robust bipartisan support, passing unanimously in the Senate and garnering a 76-0 vote in the Assembly.

SB 906 builds on the foundation laid by SB 206, the landmark legislation signed by Governor Gavin Newsom five years ago, which first allowed college athletes to profit from their NIL. While SB 206 was a game-changer in the multibillion-dollar industry of college sports, the rapid growth of NIL deals has also led to concerns, particularly regarding the emergence of “collectives” — private entities affiliated with colleges that facilitate NIL deals, often favoring male athletes in football and basketball.

“SB 206 sparked a revolution in the multibillion-dollar industry of college sports. Today, student athletes across the country are receiving compensation for their talent and hard work. That’s great news. But there has also been an increase in college sports boosters forming so-called ‘collectives’ and other strategies that appear to be benefitting men and once again shortchanging women athletes,” stated Senator Skinner.

SB 906 aims to bring more transparency to these NIL deals by requiring collectives and other entities handling NIL agreements valued at $5,000 or more annually to disclose essential details to the college or university the athlete attends. This includes the amount of compensation, the name of the athletic team, the athlete’s gender identity, and the total compensation provided to athletes by sport and gender.

Moreover, California colleges and universities would be mandated to make this data publicly available in an anonymous and aggregated form. This measure is intended to reveal the distribution of NIL deals across different sports and genders, ensuring that female athletes are not being sidelined in the rapidly expanding NIL market.

“There’s an old saying, ‘Sunlight is the best disinfectant.’ And hopefully, the transparency measures in SB 906 will prompt collectives and other NIL entities to do the right thing and boost funding for women athletes,” added Senator Skinner, who also chairs the California Legislative Women’s Caucus. She further emphasized that if the data shows that female athletes are being disadvantaged, policymakers would have the necessary information to address and correct these inequities.

With SB 906 now headed to Governor Newsom’s desk, California is poised to take another leading role in the evolving landscape of college sports, ensuring that NIL opportunities are equitable and transparent for all student-athletes.