NIL era turns 1

July 1 was the first anniversary of the NCAA’s adoption of an interim policy permitting student-athletes to monetize their names, images, and likenesses (NIL).

In doing so, the NCAA amended longstanding rules that precluded student-athletes from permitting businesses to use their NIL. Since that time, student-athletes have been able to accept compensation from a commercial entity for promoting the entity’s products on social media without violating NCAA rules, for example. The first year of the NIL era has created positive opportunities for student-athletes, yet much remains to be seen about what NIL will look like in the future.

Many feared that only the most prominent football and men’s basketball student-athletes in the country’s most visible athletics programs would benefit from NIL arrangements. However, many student-athletes from other sports, including women, have taken advantage of their newfound freedom. Many student-athletes have benefited, with some even receiving luxury vehicles from car dealerships for promoting them, for example. Locally, the Razorbacks softball program has been especially active, making team-wide arrangements with a local car dealership and barbecue restaurant.

Student-athletes have also used NIL opportunities to support charitable causes. For instance, University of Iowa football student-athletes raised funds for a children’s hospital and stillbirth prevention campaign. Locally, Razorbacks men’s basketball student-athlete JD Notae raised funds for a Northwest Arkansas nonprofit providing food and resources to needy families.

Another surprise to some has been the advent of NIL booster collectives, entities that supporters of a team or athletics department form to generate and pool revenue for NIL deals. According to national media reports, collectives are making offers of NIL arrangements contingent on a prospective student-athlete attending the university that the collective supports.

The arrangements may violate the NCAA’s interim policy if these reports are accurate. When it adopted its temporary policy, the NCAA was quick to remind that its prohibitions on pay-for-play and improper recruiting inducements remained in effect. For example, NIL pay may not be based on the number of touchdowns that a wide receiver scores or is only available if a prospective student-athlete attends a specific university.

Thus, if a collective conditions NIL compensation on a prospective student-athlete, out of high school or as a transfer from another university, enrolling only at the university that the collective supports, the arrangement could constitute an improper recruiting inducement.

Many college athletics constituents are frustrated that the NCAA’s enforcement unit charged with enforcing NCAA rules has yet to pursue any such potential violations. However, much of the enforcement process happens discreetly, so perhaps the NCAA is doing something regarding the perceived use of NIL arrangements in recruiting. Entities wishing to engage a student-athlete regarding a potential NIL arrangement should contact the compliance staff at the student-athlete’s university. Most universities have processes to assist student-athletes, and the compliance staff is familiar with these processes, NCAA guidelines and state laws.

The NCAA recently affirmed its commitment to student-athletes having the ability to monetize their NIL yet reiterated that it will continue to preclude pay-for-play and improper recruiting inducements. Over the next year of the NIL era, I will watch how the NCAA enforces the latter. I expect that we will hear of the NCAA formally investigating or punishing at least one university for violating its interim policy.

Josh Lens, J.D., is an assistant professor of recreation and sport management at the University of Arkansas and also consults for universities and conferences regarding legal and NCAA matters. The opinions expressed are those of the author.