Ohio nears NIL update to allow schools to directly pay student

If enacted, the new Ohio law would authorize universities to voluntarily compensate student-athletes for the use of that athlete’s name, image or likeness (NIL). Additionally, it would clarify that student-athletes are not university employees, allow student-athletes to obtain agents, and make their NIL contracts shielded from public record laws, among other provisions.

The push to change state law comes off the back of a lawsuit against the NCAA, which produced a preliminary settlement that sets up a revenue-sharing arrangement between schools and athletes who, for decades, played for scholarships, a few expenses and little else, while coaches and athletic departments brought in millions.

The settlement, if unchanged, would dramatically alter the layout of collegiate sports. Each school would be authorized to create a pool of money, capped at $21.5 million in its first year, to be doled out to their student-athletes at the discretion of the university’s athletic departments.

“Right now, state law bans (direct school payments),” bill sponsor Rep. Adam Mathews, R-Lebanon, told this outlet. “And, by passing House Bill 660 or similar language, we will be able to comply with (forthcoming changes to) federal law and allow universities, if they wish, to pay their student-athletes directly.”

Since NIL compensation was first allowed by the NCAA in 2021, athletes have only been able to receive compensation through third-party collectives or brand sponsorship deals.

The change, generally welcomed by university programs who, with it, would have more control over their athletes’ payments, could also put those programs in a pickle: The revenue that will soon be used to pay student-athletes is the same revenue currently used to subsidize a whole host of university sports teams that do not actually create revenue.

University of Dayton Athletic Director Neil Sullivan wrote a letter to season ticket holders in October explaining how the update may impact his athletic program. He explained schools can choose “whether and how much of these new benefits to provide to student-athletes” up to the cap and noted that UD will focus those direct payments on their basketball teams — the Flyers’ primary revenue drivers.

“We want to maintain and advance our basketball programs,” Sullivan wrote. “Our basketball performance is largely dependent on the talents and efforts of highly skilled student-athletes. Therefore, our continued ability to compete effectively depends on our ability to recruit high caliber players and to retain our existing roster. Players and their families want to be on the court, and they want to receive competitive packages and benefits.”

Mathews said he wanted to cement the forthcoming update in Ohio law to give universities more certainty as they plan budgets for the next academic year.

“We do want to be very clear, this is only coming from the athletic budgets. No taxpayer dollars are allowed to be used for this type of direct payment,” Mathews said.

Mathews’ proposed updates were folded into Senate Bill 130 last week. “We expect it to pass as we amended it, then on to the governor,” he told this outlet.

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Avery Kreemer can be reached at 614-981-1422, on X, via email, or you can drop him a comment/tip with the survey below.