The Colorado State Legislature heard arguments on Jan. 29 over a new bill outlining guidelines concerning student-athlete name, image and likeness (NIL) contracts.
State Rep. Lesley Smith, D-Boulder, is the main sponsor of Colorado House Bill 25-1041, which aims to amend Colorado’s current NIL laws in the wake of the new NCAA house settlement.
“Many other states already have, or will have, updated NIL laws to match NCAA rule changes. Colorado must follow to remain competitive nationally,” Smith said before hearing testimony.
Smith was referring to the new NCAA house settlement, which, among other things, allows schools to pay student-athletes for their NIL directly. Many states are updating their laws to comply with the new NCAA rules.
However, one clause in HB25-1041 would remove student athletes’ NIL contracts from public record, raising concerns among members of the public and press.
As a whole, HB25-1041, or Student-Athlete Name Image or Likeness bill, proposes multiple things: updating the definition of a student-athlete to include prospective students, allowing student-athletes the right to representation in contract negotiations, allowing universities to directly compensate student-athletes for their NIL, removing the requirement that students must disclose their NIL contracts to the university athletic department and exempting student athletes’ NIL contracts from public records.
Currently, NIL contracts are public information under the Colorado Open Records Act (CORA). The State House heard testimony from several concerned citizens about the bill.
An anonymous student at the University of Colorado Boulder testified in the case and cited concerns that the information protected under CORA would be restricted from the press.
“I’m afraid that a bill like the one proposed would open the door to restricting the media’s access to firsthand information, instead getting its sources by internally investigated public institutions,” they said.
Smith, however, sees it differently and cites the Family Educational Rights and Privacy Act (FERPA).
“For me, the most important aspect of this is that these are student-athletes, and they are not employees,” Smith said. “Because they’re students, I believe their student records, including contracts, should be protected under FERPA.”
Whether these NIL contracts fall under FERPA is up for debate. Eric Maxfield, an attorney and board member at Colorado Freedom of Information Coalition, testified against the bill, stating, “FERPA was designed to protect students from misinformation held by universities.”
He stressed other opinions regarding the act: “[FERPA] is not in place to protect student correct information and especially student information that’s not about their education. Not designed to protect contracts that involve the expenditure of public funds from the public.”
Where exactly the funds for paying student contracts will come from is still unclear. The NCAA House Settlement references revenue sharing from ticket sales and broadcasting rights, but there is disagreement on what qualifies as public funds.
Smith emphasized that the athletic department, along with other CU departments, is an auxiliary fund: “They generate their own money through fees and such to provide their services. There are no taxpayer dollars going toward these budgets.”
However, Maxfield also argued that NIL contracts are a “monetization of student-athletes performance… by the schools and [are] therefore public business.”
The debate over whether public universities’ budgets are considered public or private will play a large role in the future of this bill.
Josh Abram, principal fiscal analyst for the Colorado State Legislature, said in his testimony that universities in Colorado receive less than 10% of their funding from the state in accordance with their enterprise status. This means that there are public dollars in connection with CU’s funding, although the direct allocation of them is unclear.
Tim Regan-Porter, the CEO of the Colorado Press Association, testified that, “public institutions must remain accountable regardless of the funding sources and allocation,” and that even private NIL contracts are intertwined with public institutions.
These concerns over accountability stem from the fact that if these contracts are removed from public record, it will be up to the schools to police themselves, and journalists will be unable to check on the institutions.
“Without transparency, the risk of abuse increases,” warned Regan-Porter.
Along with general concerns over university accountability, concerns over Title IX compliance come to the forefront. Under Title IX, NIL opportunities must be equitably distributed between male and female athletes. Those who testified brought up concerns that without public scrutiny, there would be more risk of the universities allocating NIL funds inequitable between male and female athletes.
“Secrecy invited inequity,” Luke Story, the vice president of the Colorado Broadcasters Association, stated. Story also called the removal of NIL contracts from the public record “unnecessary and harmful to public accountability.”
State Rep. Jacque Phillips, D-Adams, also raised concerns that individuals would be unable to raise Title IX complaints without access to contract data, hindering accountability.
Smith said she’s aware “there's concern about gender equity and the NIL payments,” and recalled her time as a CU regent and part of the Gender Equity Task Force. She stated she was “very impressed” at the level of commitment CU Athletic Director Rick George and the department took to ensure gender equity across athletics, and was confident they would continue to do so even away from public oversight.
However, this lack of public accountability is still worrying. With journalists and public watchdogs unable to see these NIL contracts, Maxfield said that HB25-1041 will, “result in reliance on the university and only the university to police itself.”
Other sponsors of the bill are State Sen. Judy Amabile, D-Boulder, and State Sen. James Coleman, D-Denver. CU Athletic Director Rick George also testified in support of the bill.
George supported the restriction of NIL contracts from public record, noting the pressure student-athletes at CU are under, specifically in regards to the football team.
“[CU is] one of the most visible programs in the country,” George stated. “There’s already a ton of scrutiny on our student-athletes where it impacts their mental health.” He suggested having public NIL contracts would add another level of scrutiny and pressure.
Ultimately, while proponents of the bill argue that it’s necessary to protect student-athletes, members of the press worry that the lack of transparency will risk misuse of public resources and gender inequity.
While it’s necessary for Colorado to update its laws to match NCAA rules regarding NIL, the issue of transparency will affect both journalists and the public.
The aforementioned CU student hopes that the “future of transparency with journalists and [the] state’s public colleges remains as open as possible. [He feels] it’s the best path forward for keeping a healthy relationship between these athletes, the media, the schools, and their information department.”
The bill will be laid over, and Smith said the committee would discuss options with lobbyists from the press throughout the week.