NIL changes to take effect in South Carolina, Oregon, Connecticut

Friday, July 1 marks the one-year anniversary of the NIL era at the NCAA level and the first day of the era’s second year will be a newsworthy one. Starting Friday, state legislation in Connecticut, Oregon and South Carolina will either take effect or no longer apply, with the most significant change coming in The Palmetto State.

Here’s everything you need to know about the NIL-related legislative changes that take effect July 1, 2022.

South Carolina suspends state law regarding NIL

Last week, South Carolina Gov. Henry McMaster announced his vetoes for the state’s General Appropriations Act, or in other words the state budget, for the 2022-23 fiscal year.

The state’s General Assembly previously ratified the suspension of the state law that applies to NIL compensation for college athletes (Act 35 of 2021) and Gov. McMaster didn’t veto it. The suspension stands.

That means for at the least the next fiscal year, only the NCAA’s interim NIL policy will apply to the state.

The soon-to-be suspended act stated that a university can’t directly or indirectly facilitate “compensation opportunities” for the use of an athlete’s NIL. It also said that entities that support a university or its athletic programs can’t directly or indirectly compensate athletes through NIL.

“I would ask that everybody vote for this, otherwise you’re going to see some of the best players in the country go to schools that don’t have Clemson or South Carolina in their name,” Rep. Tim McGinnis said in his closing remarks during a legislative session in March.

A growing number of state lawmakers, especially in the SEC footprint, including in Alabama, Mississippi, Missouri, South Carolina and Tennessee, have amended, repealed or suspended their laws regarding NIL.

Connecticut removes prohibition of athletes using institutional marks

In May, Connecticut Gov. Ned Lamont signed Senate Bill 20. Starting Friday, the three-page bill that was signed into law will remove the prohibition of athletes using institutional marks, such as a school’s name, mascot, logo or unique color scheme, while fulfilling their contractual obligations in NIL activities. The law will also require universities to develop a policy regarding athletes’ use of institutional marks.

However, universities aren’t required to allow their athletes to use institutional marks.

College athletes’ personal brands and name recognition is often tied to their athletic program at their school. This law creates a potential path for athletes to use official school marks in connection with their NIL activities. However, universities are also protective of their institutional marks, which is why specific policies will be required under law.

Oregon requires producers of jerseys, video games and trading cards to pay royalties

In March, Oregon Gov. Kate Brown signed Senate Bill 1505, which will require the for-profit producers of jerseys, video games and trading cards to pay royalties to athletes for the use of their NIL.

The state law will also change the definition of an agent. The definition no longer includes students at a university who are participating in a clinic, studio, lab or other school-created program for educational, training or support purposes.

Click here to read more on how NIL legislation varies on a state-by-state basis.