While the focus of attention on college athletics remains on the recent House v. NCAA settlement and the submission of the proposed settlement documents to be reviewed and discussed by Senior U.S. District Judge Claudia Wilken on September 5th, the world of high school Name, Image and Likeness (NIL) rights to student-athletes continues to grow. As the number of states authorizing NIL rights approaches 40, the need to understand the nuances of the varying state law becomes increasingly crucial. Most recently, on July 24, 2024, the Florida State Board of Education (see our blog post on the decision here) put an end to a years-long debate by officially joining the other states in permitting high school athletes to participate in NIL arrangements without sacrificing their amateur status. The Florida bill highlights the importance of formal agreements when engaging in NIL activities in an effort to combat undisclosed pay-for-play deals. Additionally, Florida addressed concerns of the new policy fostering unfair competition by prohibiting NIL activities during a student-athlete's transfer season. South Dakota also made headlines in July by adopting a similar policy allowing high school athletes in the state to benefit from their NIL. However, despite the growing national shift toward recognizing and cultivating exploration of this new revenue stream for young athletes, one major athletic high school athletic powerhouse – North Carolina – is still navigating the complex terrain of NIL regulations, offering a very controversial option for NIL rights for the state's high school athletes.
North Carolina Maintains Controversial Split in NIL Authorization for High School Athletes
In May 2023, the North Carolina High School Athletic Association (NCHSAA) approved a proposal that would have allowed high school athletes to monetize their NIL beginning July 1, 2023. While the proposal awaited final ratification from the State Board of Education (the Board), state legislators decided to step in and usurp the NCHSAA's authority, proposing to block the new policy by stripping the NCHSAA of its rulemaking authority. North Carolina Bill 636 was passed by the state legislature, which formally stripped the NCHSAA of much of its authority, including its ability to oversee NIL policies. This a rarity, as most state legislatures do not typically interfere with the rulemaking role of the state associations overseeing high school sports. Although the bill ultimately died in the House of Representatives, North Carolina's lengthy legislative process put the proposal on hold for over a year. When the Board finally addressed the issue at a June 6, 2024 meeting, it reversed the NCHSAA's initial position and barred NIL activities for student-athletes attending public high schools in the state, while the state's independent athletic association, which oversees private school athletes, has authorized student-athletes in non-public schools to be able to pursue their NIL rights. Specifically, athletes at public high schools in North Carolina are not able to profit off their name, image and likeness through: public Appearances or commercials, autograph signings, athletic camps and clinics, sale of non-fungible tokens (NFTs), product endorsements, and personal, in-person promotional activities and social media.
The Board's decision has created a dramatic rift in policy across the state as student-athletes attending private institutions were granted the green light by the North Carolina Independent Schools Athletic Association (NCISAA) to capitalize on and explore NIL opportunities at the nearly 100 private schools for which it oversees and governs athletics. While the NCISAA's authorizes these restricted NIL opportunities, their policy also mirrors those found in many other states by banning collectives and restricting NIL activities relating to controlled substances, adult entertainment and alcohol. This split in regulations between private schools and public schools has raised concerns among coaches statewide, who fear that top prospects will gravitate toward private schools where NIL opportunities are available, and thus creating an uneven playing field in high school athletics across the state.
Most recently, the NCHSAA presented the findings of its 2-year long study of NIL for high school athletes in hopes of persuading the Board to align its NIL policy with that of North Carolina private schools and a majority of states. The Board heard NCHSAA's presentation at the end of July and it is expected that a vote on a unified statewide NIL policy could occur later this year to eliminate the current NIL advantage being offered to private school athletes, to the detriment of the state's tremendous pool of public school high school athletes.
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