wa-law.org > bill > 2025-26 > SB 6235 > Original Bill
The legislature finds that intercollegiate athletics are conducted under the auspices of nonprofit institutions of higher education and, when properly governed, promote student development, campus life, community identity, and broad public engagement in education, benefits that constitute a public good aligned with the educational missions those institutions are chartered to serve.
The legislature further finds that intercollegiate athletics generate hundreds of millions of dollars in revenue annually through national media contracts, sponsorships, and ticket sales within our state, creating a significant impact on our commerce.
Public institutions of higher education are financed and supported by taxpayers through direct appropriations, tax-exempt status, subsidized federal student aid, state grant funds, and tax-advantaged debt, and therefore have a heightened obligation to ensure that institutional assets, including intercollegiate athletics programs and facilities, are managed for public benefit and student welfare rather than private enrichment.
The legislature therefore acknowledges that these agreements that convey ownership, revenue-sharing, control rights, or security interests in intercollegiate athletics to private equity, hedge funds, or similar vehicles are inherently conflicted, create pressure to maximize short-term cash flows at the expense of educational and Title IX obligations, and risk extracting wealth from publicly supported institutions and their students, undermining transparency, accountability, and the public purposes for which those institutions exist.
The governing boards of each of the state universities, the regional universities, The Evergreen State College, and community colleges in addition to their other duties prescribed by law shall have the power and authority to establish programs for intercollegiate athletic competition. Such competition may include participation as a member of an athletic conference or conferences, in accordance with conference rules.
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As a condition of the power and authority established in this section, an institution of higher education may not enter into, maintain, or permit any agreement with a private capital firm or a sovereign wealth fund that:
Transfers, assigns, pledges, or otherwise conveys to such firm or fund any ownership, profit, net revenue, or gross revenue interest arising from the institution's intercollegiate athletics program, including media, sponsorship, licensing, ticketing, premium seating, data, or other commercial rights;
Grants such firm or fund control rights over athletics decisions, institutional branding, scheduling, personnel, or student participation; or
Establishes a joint venture, new entity, or other agreement through which such firm or fund receives any share of, or any interest in, athletics-related revenues or rights, including licensing and merchandising rights, or athletics facilities or related real property including any leasehold, sublease, concession, easement, mortgage, deed of trust, lien, or similar property interest.
Except as limited in (a) of this subsection, the following agreements are allowable:
Fee-for-service contracts for discrete services;
Charitable contributions, gifts, or grants;
Tax-exempt bond financings, lease-purchase agreements with governmental units, or governmental entities that issue tax-exempt bonds that do not convey revenue interests or control rights to a private capital firm; and
Sponsorships or advertising agreements that provide brand placement without revenue sharing or control.
An institution of higher education shall ensure compliance for any agreement entered by an athletics conference, media-rights consortium, or other affiliate that allocates, assigns, or encumbers the institution's athletics-related revenues or rights.
This section applies to any collective, foundation, affiliate, or separate legal entity that is directly or indirectly owned, controlled, or operated by the institution of higher education or its athletics department.
The governing boards of each of the institutions of higher education shall require annual program participation agreement certification that the institution and its affiliates have not entered into any agreement listed under (a) of this subsection and shall require public disclosure of all agreements relying on an exception under (b) of this subsection. The governing boards of each of the institutions of higher education shall report to the appropriate higher education committees of the legislature on these agreements annually.
For the purposes of this section, the following definitions apply:
"Control rights" includes consent, veto, or approval rights over budgets, hiring, scheduling, competition, branding, or strategic decisions; or other rights to assume or direct management or operations of an intercollegiate athletics program or athletics facility;
"Intercollegiate athletics program" includes teams, departments, conferences, media or data rights, ticketing and premium seating, sponsorships, licensing and merchandising, and athletics facilities used primarily for intercollegiate varsity sports competition;
"Private capital firm" means (i) a hedge fund or private equity fund as those terms are defined in 12 U.S.C. Sec. 1851(h)(2), (ii) a private fund as defined in 15 U.S.C. Sec. 80b–2(a)(29), and (iii) any investment adviser (as defined in 15 U.S.C. Sec. 80b–2(a)(11)) that advises a fund described in (c)(i) or (ii) of this subsection; and
"Sovereign wealth fund" means an investment fund owned or controlled by a foreign state, an agency or instrumentality of a foreign state (as defined in 28 U.S.C. Sec. 1603), or an agent of a foreign principal (as defined in 22 U.S.C. Sec. 611).
Agreements in effect on the effective date of this section must be brought into compliance or terminated no later than 24 months after such date. No agreement may be renewed or extended without compliance with this section.
The governing boards shall adopt rules after consultation with the state treasurer and the department of financial institutions and, to the maximum extent practicable, harmonize such regulations with definitions and interpretations under the federal securities laws.
If any part of this act is found to be in conflict with federal requirements that are a prescribed condition to the allocation of federal funds to the state, the conflicting part of this act is inoperative solely to the extent of the conflict and with respect to the agencies directly affected, and this finding does not affect the operation of the remainder of this act in its application to the agencies concerned. Rules adopted under this act must meet federal requirements that are a necessary condition to the receipt of federal funds by the state.