By: Creighton, Miles, West S.B. No. 1385
(In the Senate - Filed March 10, 2021; March 18, 2021, read
first time and referred to Committee on Higher Education;
April 19, 2021, reported adversely, with favorable Committee
Substitute by the following vote: Yeas 9, Nays 0; April 19, 2021,
sent to printer.)
Click here to see the committee vote
COMMITTEE SUBSTITUTE FOR S.B. No. 1385 By: Creighton
A BILL TO BE ENTITLED
AN ACT
relating to the compensation and professional representation of
student athletes participating in intercollegiate athletic
programs at certain institutions of higher education.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. The legislature finds and declares the
following:
(1) intercollegiate athletics are an essential part of
the fabric of this state;
(2) the competitive integrity of intercollegiate
athletics is of vital importance;
(3) the United States Congress has failed to act to
provide uniform guidance to the states on the matter of
intercollegiate athletes receiving compensation in exchange for
the use of the athlete's name, image, or likeness; and
(4) the United States Congress must act on this matter
to ensure the competitive integrity of intercollegiate athletics.
SECTION 2. Subchapter Z, Chapter 51, Education Code, is
amended by adding Section 51.9246 to read as follows:
Sec. 51.9246. COMPENSATION AND PROFESSIONAL REPRESENTATION
OF STUDENT ATHLETES PARTICIPATING IN INTERCOLLEGIATE ATHLETIC
PROGRAMS. (a) In this section:
(1) "Athlete agent" has the meaning assigned by
Section 2051.001, Occupations Code.
(2) "General academic teaching institution" and
"private or independent institution of higher education" have the
meanings assigned by Section 61.003.
(3) "Honor code" means a set of rules or principles
governing an academic community to which a student agrees to abide
when attending an institution to which this section applies.
(4) "Institutional contract" means a contract between
an institution to which this section applies or its designated
representative and an external party that includes a sponsorship
agreement governing the use of the institution's trademarks in
connection with athletics.
(5) "Team contract" means a contract between a student
athlete and an institution to which this section applies and
includes any rules or expectations of the institution's athletic
department or head coach that require a student athlete's
compliance as a condition under the contract of participation as a
member of the intercollegiate athletic program.
(b) This section applies only to:
(1) a general academic teaching institution; or
(2) a private or independent institution of higher
education.
(c) An institution to which this section applies may not:
(1) adopt or enforce a policy, requirement, standard,
or limitation that prohibits or otherwise prevents a student
athlete participating in an intercollegiate athletic program at the
institution from:
(A) earning compensation for the use of the
student athlete's name, image, or likeness when the student athlete
is not engaged in official team activities, as that term is defined
by the institution; or
(B) obtaining professional representation,
including representation by an athlete agent or attorney, for
contracts or other legal matters relating to the use of the student
athlete's name, image, or likeness; or
(2) provide or solicit a prospective student athlete
of an intercollegiate athletic program at the institution with
compensation in relation to the prospective student athlete's name,
image, or likeness.
(d) A scholarship, grant, or similar financial assistance
awarded to a student athlete by an institution to which this section
applies that covers the student athlete's cost of attendance at the
institution is not compensation for purposes of this section.
(e) A student athlete participating in an intercollegiate
athletic program at an institution to which this section applies
may not be disqualified from eligibility for a scholarship, grant,
or similar financial assistance awarded by the institution because
the student athlete:
(1) earns compensation from the use of the student
athlete's name, image, or likeness when the student athlete is not
engaged in official team activities; or
(2) obtains professional representation, including
representation by an athlete agent or attorney, for contracts or
other legal matters relating to use of the student athlete's name,
image, or likeness.
(f) An institution to which this section applies may not
prescribe a team contract for an intercollegiate athletic program
that prohibits or otherwise prevents a student athlete from using
the student athlete's name, image, or likeness for a commercial
purpose when the student athlete is not engaged in official team
activities.
(g) A student athlete participating in an intercollegiate
athletic program at an institution to which this section applies:
(1) shall, before entering into the contract, disclose
to the institution, in the manner prescribed by the institution,
any proposed contract the student athlete may sign for use of the
student athlete's name, image, or likeness;
(2) may not enter into a contract for the use of the
student athlete's name, image, or likeness if:
(A) any provision of the contract conflicts with
a provision of the student athlete's team contract, a provision of
an institutional contract of the institution, or a provision of the
honor code of the institution;
(B) the compensation for the use of the student
athlete's name, image, or likeness is provided:
(i) in exchange for athletic performance or
attendance at the institution;
(ii) by the institution;
(iii) in exchange for property owned by the
institution or for providing an endorsement while using
intellectual property or other property owned by the institution;
or
(iv) in exchange for an endorsement of
alcohol, tobacco products, e-cigarettes or any other type of
nicotine delivery device, anabolic steroids, casino gambling, a
firearm the student athlete cannot legally purchase, or a sexually
oriented business as defined in Section 243.002, Local Government
Code; or
(C) the duration of the contract extends beyond
the student athlete's participation in the intercollegiate
athletic program;
(3) may not enter into a contract for the student
athlete's representation by an athlete agent relating to use of the
student athlete's name, image, or likeness unless the athlete agent
holds a certificate of registration under Chapter 2051, Occupations
Code;
(4) is not considered an employee of the institution
based on the student athlete's participation in the intercollegiate
athletic program; and
(5) may earn compensation from selling the student
athlete's autograph in a manner that does not otherwise conflict
with a provision of this section.
(h) An institution to which this section applies that
identifies a provision in a contract disclosed to the institution
by a student athlete under Subsection (g)(1) that conflicts with a
provision in the student athlete's team contract, an institutional
contract of the institution, or the honor code of the institution
shall promptly disclose the conflict to the student athlete or the
student athlete's representative, if applicable. The student
athlete or the student athlete's representative is responsible for
resolving the conflict not later than the 10th day after the date of
the disclosure.
(i) An institution to which this section applies shall
require a student athlete participating in an intercollegiate
athletic program at the institution to attend a financial literacy
and life skills workshop at the beginning of the student's first and
third academic years at the institution. The workshop must be at
least five hours in duration and include information on financial
aid, debt management, time management, budgeting, and academic
resources available to the student athlete. The institution may
not during the workshop allow any provider of financial products or
services to:
(1) market, advertise, or refer the provider's
services to a student athlete; or
(2) solicit a student athlete to use the provider's
services.
SECTION 3. Section 2051.351, Occupations Code, is amended
by adding Subsection (b-1) to read as follows:
(b-1) This chapter, including this section, does not
prohibit an athlete agent from representing a student athlete in
the use of the student athlete's name, image, or likeness in
accordance with Section 51.9246, Education Code.
SECTION 4. Section 51.9246(f), Education Code, as added by
this Act, applies only to a contract entered into, modified, or
renewed on or after the effective date of this Act.
SECTION 5. This Act takes effect September 1, 2021.
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