Texas colleges will soon be able to pay their athletes

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Texas colleges could soon pay student athletes directly for the first time.

The Senate unanimously passed a bill on Tuesday that would allow colleges to enter directly into what are called “name, image and likeness” agreements with athletes. Currently, only outside entities, like national advertisers or athletic boosters, can do so.

“The Senate saved college sports in Texas,” Lt. Gov. Dan Patrick said, jokingly afterward.

The Senate was supposed to consider House Bill 126 on Sunday, but delayed after senators complained they hadn’t been fully briefed on the issue. Some then hopped on a call with college coaches across the state, who emphasized they needed the legislation to disperse millions of dollars as part of a court settlement that is expected to be finalized in the fall and to be able to effectively recruit top talent.

“Had they only informed everyone in the Senate a few weeks ago what was happening, we would have passed it the first time,” Patrick said, “but everyone’s kind of learned their lesson. It’s good to talk to senators when you want their vote … here’s to winning in Texas.”

Sen. Brandon Creighton, a Conroe Republican sponsoring the legislation in the upper chamber, agreed on Tuesday to limit the deal making to athletes 17 or older after hearing concerns from his Democrat colleagues that younger athletes might be taken advantage of. The student athletes would not receive payments from the university until after they are enrolled and participating in their sports program.

“I hope this amendment addresses some of the primary concerns that we talked about two nights ago and ensures that the guardrails are there for a level playing field for our young athletes,” Creighton said.

Creighton, who authored Texas’ existing NIL law, said student athletes would still be prohibited from entering into agreements with sexually-oriented business or alcohol or tobacco companies. They’d also still be required to take a financial literacy course.

The proposal comes after several high profile lawsuits against the National Collegiate Athletic Association, or the NCAA, challenging its restrictions on compensation.

Last year, the NCAA agreed to settle one of these cases by paying back $2.8 billion to athletes who had participated in Division I sports since 2016.

A judge is expected to approve the settlement and the NCAA is supposed to change its rules soon, which is why the Texas Tech University and Texas A&M University systems have publicly pushed state lawmakers to act. They say without this bill, Texas talent will go to other states.

The NCAA is expected to cap the total amount all universities can pay their athletes annually at $20.5 millon. Creighton said during a Senate education committee earlier this month that smaller universities can make strategic investments below the cap to recruit for their sports programs. He said he hoped a federal law on this issue would pass otherwise courts could require schools to pay even more or treat their athletes as employees.

Democrat Sens. Royce West of Houston and José Menéndez of San Antonio focused more on the students’ wellbeing than the schools’.

West asked if universities were notifying those who played for them in recent years that they could receive a portion of that billion dollar settlement. The Texas A&M University System said it was.

Menéndez pointed out that universities in Division I sports generate billions of dollars in revenue a year while less than 2% of student athletes go pro.

“Why should these athletes not be able to share some of the gain or the resources that their families could desperately need?” he said.

After the House approved the Senate's changes with a 110-25 vote on Thursday, the bill now heads to the governor’s desk to be signed into law. If signed, it will take effect on Sept. 1.

The Texas Tribune partners with Open Campus on higher education coverage.

Disclosure: Texas A&M University, Texas Tech University and Texas A&M University System have been financial supporters of The Texas Tribune, a nonprofit, nonpartisan news organization that is funded in part by donations from members, foundations and corporate sponsors. Financial supporters play no role in the Tribune's journalism. Find a complete list of them here.

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