Tuberville In the News: WHNT 19: Tuberville introduces federal legislation for NIL, transfer portal in college sports

WASHINGTON, D.C. (WHNT) —  Senators Tommy Tuberville (R-AL) and Joe Manchin (D-WV) have formally introduced federal legislation for Name, Image and Likeness (NIL) in college sports.

The Senators introduced the Protecting Athletes, Schools, and Sports (PASS) Act of 2023 Tuesday in an effort to ‘protect student-athletes, maintain fair competition and compensation, strengthen transparency, and preserve the time-honored tradition of college sports.’

This piece of legislation comes two years after a Supreme Court decision allowed collegiate athletes to profit off their name, image and likeness.

The Pass Act lays out rules to protect student-athletes, schools, moderate the transfer portal and ‘ensure the health and safety of student-athletes.’

First, the Pass Act lays out protections for student-athletes by:

  • Requiring collectives and boosters to be affiliated with a college or school.
  • Establishing a national standard for NIL.
  • Preserving Title IX and ensuring that nothing in the PASS Act affects the rights of any student-athletes or any programs funded through Title IX.

Second, the Pass Act lays out protections for the Universities by:

  • Ensuring that schools, conferences, and associations are not liable for their efforts to comply with the PASS Act.
  • Prohibiting NIL agreements that involve alcohol, drugs, or conflict with existing school and conference licenses.
  • Requiring student-athletes to ask permission to make use of existing intellectual property (IP)

Third, the Pass Act “ensures the health and safety of student-athletes” by:

  • Guaranteeing health insurance for sports-related injuries for uninsured student-athletes for 8 years following graduation from a 4-year institution.
  • Requiring institutions generating more than $20 million and $50 million in athletics revenue to pay out-of-pocket expenses for two and four years, respectively.  
  • Requiring institutions to honor the original scholarship commitment made to a student-athlete.
  • Implementing a Uniform Standard Contract for student-athlete use for NIL deals.
  • Enhancing curriculum on financial literacy, NIL rights, and related legal and regulatory issues.
  • Strengthening enforcement and oversight by directing the NCAA to oversee and investigate NIL activities and report violations to the Federal Trade Commission.

The Pass Act addresses the transfer portal as well, which has become a growing concern for many in collegiate athletics. The Pass Act shows data that states 41% of student-athletes who enter the transfer portal did not find a new school.

To try to moderate the transfer portal, the act introduces new guidelines. Those guidelines state that student-athletes are not eligible to transfer from a school until they’ve been with their original school for three years.

However, there are some exceptions that would allow a student-athlete to transfer:

  • Death or terminal illness of a family member
  • Athletes primary position coach or head coach are fired or take another job

Student-athletes who do not fall under these exceptions must sit out for a full academic year before they would be eligible to play for another school.

Tuberville and Manchin have been working towards a bill that would regulate NIL and establish federal guidelines for athletes and schools since August 2022.

In a letter to SEC Commissioner Greg Sankey, the two lawmakers outlined what they feel is wrong with the current state of college athletics.

“A lack of clear, enforceable rules is creating an environment that potentially allows for the exploitation of student-athletes by unregulated entities, prioritizes short-term financial gain over careful investment in one’s career and the lifelong value of education, and diminishes the role of coaches, mentors, and athletic staff while empowering wealthy boosters. In short, we are rapidly accelerating down a path that leads away from the traditional values associated with the scholastic athletic competition.”

In June 2023, Tuberville along with fellow Senator Katie Britt (R-AL) met with several coaches and administrators from Alabama and Auburn to get their input on what legislation for NIL should look like. At the time, Tuberville called NIL ‘disastrous’ and said the legislation would be out soon.

On June 9, the IRS issued a memo to Universities on the issue. The IRS released the following view on the issue:

It is the view of this Office that many organizations that develop paid NIL opportunities for student-athletes are not tax-exempt and described in section 501(c)(3) because they provide to student-athletes are not incidental both qualitatively and quantitatively to any exempt purpose furthered by that activity.

Tuberville released the following statement about the legislation being introduced today:

“Student athletes should be able to take advantage of NIL promotional activities without impacting their ability to play collegiate sports, but we need to ensure the integrity of our higher education system, remain focused on education, and keep the playing field level. Our legislation with Senator Manchin will set basic rules nationwide, protect our student-athletes, and keep NIL activities from ending college sports as we know it.”

Mancin also released a statement, discussing the legislation and its intent in a ‘rapidly evolving NIL landscape.’

“As a former college athlete, I know how important sports are to gaining valuable life skills and opening doors of opportunity. However, in recent years, we have faced a rapidly evolving NIL landscape without guidelines to navigate it, which jeopardizes the health of the players and the educational mission of colleges and universities. Our bipartisan legislation strikes a balance between protecting the rights of student-athletes and maintaining the integrity of college sports. I urge my colleagues on both sides of the aisle to consider this commonsense legislation as a way to level the playing field in college athletics.”

For more information or to read the entire Pass Act can be read, click here.