California Senate Bill 206, more commonly referred to as the Fair Pay to Play Act, now makes it illegal for California universities to revoke an athlete's scholarship or eligibility for taking money. Under the new law, schools will not pay athletes, but athletes can hire agents to seek out business deals for them. The bill will not go into effect until Jan. 1, 2023.
California schools and the NCAA have long opposed the bill, which makes it impossible for schools to follow the NCAA's amateurism rules. The NCAA sent a letter to Newsom earlier this month calling the state's legislation "unconstitutional."
The Fair Pay to Play Act received notable endorsements, including one from Lakers star LeBron James. James hosted Newsom on HBO's The Shop for the bill's signing.
"[Signing the bill] is going to initiate dozens of other states to introduce similar legislation," Newsom said on the show before signing the bill. "And it’s going to change college sports for the better by having now the interests, finally, of the athletes, on par with the interests of the institutions. Now we’re rebalancing that power arrangement."
James also praised Newsom's decision to sign the bill into law in a tweet on Monday.
Shortly after the bill was signed, the NCAA issued its own statement in response to California's new law.
"As a membership organization, the NCAA agrees changes are needed to continue to support student-athletes, but improvement needs to happen on a national level through the NCAA’s rules-making process. Unfortunately, this new law already is creating confusion for current and future student-athletes, coaches, administrators and campuses, and not just in California," the NCAA said. "We will consider next steps in California while our members move forward with ongoing efforts to make adjustments to NCAA name, image and likeness rules that are both realistic in modern society and tied to higher education."