State of Tennessee Amends NIL Law to Further Empower Institutions and Collectives
By Kristi Dosh
Last Updated on April 24, 2022
Tennessee governor Bill Lee signed an amendment to the state’s name, image and likeness legislation on April 20th. The amendment makes significant changes to the way collectives can work with college coaches and athletic departments.
WVLT News first reported it and spoke with Spyre Co-Founder Hunter Baddour, who said of the bill, “it’s a gamechanger.”
Tennessee’s NIL amenement
A summary of the bill was posted by the state legislature as follows (emphasis added):
Under present law, an intercollegiate athlete at a four-year public or private institution of higher education located in this state, other than an institution of higher education governed by the board of regents of the state university and community college system, (an “institution”) may earn compensation for the use of the athlete’s name, image, or likeness. Such compensation may not be provided in exchange for athletic performance or attendance at an institution and may only be provided by a third party. This amendment removes the reference to the athlete being “at an institution” and the provision that compensation only be provided by a third party, and clarifies that an institution or an officer, director, or employee of the institution may not compensate a current or prospective intercollegiate athlete for the intercollegiate athlete’s name, image, or likeness.
This amendment removes the present law provision whereby an institution, or an officer, director, or employee of the institution may not be involved in the development, operation, or promotion of a current or prospective intercollegiate athlete’s name, image, or likeness, including actions that compensate or cause compensation to be provided to athletes. This amendment instead provides that an institution’s involvement in support of name, image, or likeness activities does not constitute compensation to or representation of an intercollegiate athlete by the institution for purposes of this part so long as the institution does not coerce, compel, or interfere with an intercollegiate athlete’s decision to earn compensation from or obtain representation in connection with a specific name, image, or likeness opportunity.
Present law prohibits an entity whose purpose includes supporting or benefitting the institution or its athletic program from compensating or causing compensation to be provided to a current or prospective intercollegiate athlete for the athlete’s name, image, or likeness if the arrangement is contingent on the athlete’s enrollment or continued participation at an institution. This amendment removes this provision.
This amendment adds that:
(1) Parents, siblings, grandparents, spouses, and legal guardians of an intercollegiate athlete who represent the intercollegiate athlete for the purpose of securing compensation for the use of the intercollegiate athlete’s name, image, or likeness are not considered to be athlete agents for purposes of this part, and are not subject to the requirements for athlete agent; and
(2) An athletic association’s governing actions, sanctions, bylaws, and rules must not interfere with an intercollegiate athlete’s ability to earn compensation and must not otherwise impact an intercollegiate athlete’s eligibility or full participation in intercollegiate athletic events, unless the intercollegiate athlete has committed a violation of the rules of an institution or an athletic association or this act is invalidated or rendered unenforceable by operation of law.
Breaking down the practical impact
The first paragraph opens the door for NIL compensation to be made to prospective student athletes.
The second paragraph removes the “institutional involvement” prohibition and allows athletic department employees (athletic directors, coaches, etc.) to be part of the process as long as they aren’t coercing or compelling an athlete’s decision to attend or stay at an institution.
The third paragraph goes even further and allows NIL deals that are contingent on enrollment at a particular institution. However, that’s one the NCAA is pretty clear on, so it may have no immediate impact.
It goes on to say that parents, spouses, siblings, grandparents and legal guardians are not subject to requirements of athlete agents, even when they are representing the athlete for NIL deals.
Honestly, the very last paragraph is confusing. First it says an athletic association’s (i.e., the NCAA’s) rules must not interfere with an athlete’s ability to earn compensation or stay eligible, but then later in the sentence it adds “unless the intercollegiate athlete has committed a violation of the rules…”
WVLT News concluded that collectives can now participate in the recruiting process more freely in Tennessee, co-host events with the athletic department and even be endorsed by athletic officials, including coaches.
No doubt, this is going to make for some interesting news and storylines coming out of the state in the future.
