College Athletics Faces Uncertainty Amid NIL Policy Changes

College Athletics Faces Uncertainty Amid NIL Policy Changes

States, the NCAA and Congress grapple with creating a fair and consistent system for student-athletes.

More than 30 states have passed NIL laws, advancing athletes' rights. (michaelquirk/Getty Images)

College athletics is undergoing a seismic shift. After years of lawsuits, state laws and NCAA rule changes, a $3 billion settlement, effective July 1, has transformed how student-athletes are compensated. Yet the future remains uncertain amid ongoing legal and legislative battles.

More than 30 states have passed NIL (name, image and likeness) laws, advancing athletes' rights. Additionally, the settlement in June of the class-action lawsuit House v. NCAA, filed by athletes against the association, allowed direct NIL payments to athletes and introduced a salary cap system and compliance rules. However, concerns about state laws, NCAA enforcement, and challenges from boosters and NIL collectives remain unresolved.

In response, Congress is considering the SCORE Act, which proposes overriding state NIL laws to create a nationwide framework. The legislation would empower the NCAA to enforce rules and prohibit athletes from being classified as employees. While some worry about federal preemption of state law, lawmakers see it as a way to stabilize college athletics.

"We've worked on transparency, protecting our athletes and ensuring they are compensated just as universities have been for decades."

-Colorado Senate President James Coleman

During a panel discussion on college sports at the 2025 NCSL Legislative Summit, Tim Buckley, NCAA senior vice president for external affairs, said legal challenges have forced significant changes to transfer and eligibility policies.

"We couldn't wait while the case played out," he says, referencing lawsuits that overturned NCAA rules in 2023. "We had to have a season, form teams and make rules."

While some applaud the increased movement for athletes, others fear academic priorities are being sidelined. Meanwhile, lawsuits continue to challenge eligibility rules, and the NCAA is calling for federal intervention to set consistent national standards.

"I completely understand why states have stepped in," Buckley says, adding that while the NCAA has modernized with initiatives like guaranteed scholarships and health care, federal support is needed to stabilize college sports.

State Perspectives

States have taken varied approaches to NIL policies. Utah Sen. Ann Millner says her state has prioritized allowing direct NIL payments to student-athletes, with audit measures to ensure compliance.

"We feel like that's going to be a better approach," she says, stressing the need to safeguard amateur athletics for athletes outside the NCAA's Power Five conferences. "We really need to find the right balance."

Following California's lead, Virginia enacted a bipartisan law (HB 1505; 2024) allowing public and private colleges to compensate student-athletes and shield schools from NCAA penalties directly.

"This law ensures our schools and athletes have the freedom to engage in NIL deals without fear of repercussions," Virginia Sen. Mamie Locke says.

Georgia Rep. Chuck Martin expresses concerns about young athletes signing predatory contracts. "There are situations where somebody has signed away 10% of their earning potential for the rest of their life for a $25,000 check," he says.

He also notes the skyrocketing value of NIL deals, comparing college athletes earning millions to NFL rookies earning less. "This is not NIL anymore, folks."

Colorado Senate President James Coleman highlights his state's leadership in NIL policy since 2020.

"We've worked on transparency, protecting our athletes and ensuring they are compensated just as universities have been for decades," he says. Colorado law allows athletes to be paid by businesses and universities while protecting them from predatory practices by ensuring access to professional representation.

A key feature of the law, he adds, is requiring annual reporting on gender- and sport-based spending to address pay inequities. "It's important to inspire young women to pursue athletics the same way we encourage young men," Coleman says.

Challenges and Concerns

Coleman also emphasized the importance of academics and health. "The students are there to get an education. They're not there to play sports," he says, pointing to higher GPAs among Colorado student-athletes. He stresses mental and physical well-being, recalling athletes who lost scholarships after injuries. "That's why it's critical to focus on the health of our athletes, not just their performance on the field or court."

Martin echoes concerns about equity in opportunities. "We're focusing so much on the million-dollar guys and ladies that we're leaving some kids out, particularly females," he says, adding that limited resources might discourage schools from expanding opportunities for women.

Locke notes Virginia's rapid NIL compliance efforts, including mandatory education on contract law, financial literacy and branding.

"We have to deal with the student part of the student-athlete and ensure that's not being lost," she says.

Millner questions whether NIL policies are taking college athletics away from its core values. "The question is, what is college athletics all about? There was a time when it was focused on academics," she says, adding that smaller schools struggle to fund athletics. "Ninety-five percent of schools out there aren't making money and are supplementing athletics because they believe in the value it brings to students," she says, advocating for different approaches for Power Five and smaller schools.

The NCAA's Role

Buckley, with the NCAA, underscores the association's efforts to support education and equity. "Our rules require universities to honor scholarships and give athletes 10 years to come back and finish their degrees," he says. He also highlighted progress in women's sports, such as a financial incentive program for the women's basketball tournament, now on par with the men's.

"For the first time ever, campuses are incentivized to invest in women's basketball," he says.

However, Buckley warns that NIL regulations must maintain equity in sports funding.

"We need to ensure these laws aren't tilting the playing field in favor of one school or team," he says. "That cap on NIL dollars is essential for schools to continue investing in women's and Olympic sports that don't generate much revenue."

The Role of Federal Legislation

The fragmented NIL landscape has prompted Congress to consider a federal solution. The proposed SCORE Act would create a uniform system by overriding state NIL laws and granting intercollegiate athletic associations the authority to regulate student-athlete deals. Under the new NCAA rules ushered in through the House settlement, contracts over $600 are permitted only if they are for "fair market value" and serve a "valid business purpose." Compliance actions under these terms have already faced challenges.

Locke expressed skepticism about federal intervention. "The floodgate has already been opened," she says, noting that 32 states have already passed their own NIL legislation. "At the federal level, I have absolutely no confidence that we are going to solve this problem."

Coleman, however, emphasizes the need for collaboration.

"We do need a 50-state solution," he says. "But we have to come together and talk about what is best for our athletes, what is best for each state, and what our federal level can do."

Lesley Kennedy is NCSL's director of publishing and digital content.