President Donald Trump signed an executive order last week targeting what the White House called “an out-of-control financial arms race” in college athletics, placing new restrictions on player eligibility and transfers and threatening to pull federal funding from universities that don’t comply.
The order takes effect August 1.
Under the new rules, college athletes will be allowed five years of eligibility and restricted to one transfer. A second transfer is permitted only after an athlete earns a four-year degree. The order also closes a loophole that had let athletes who played professionally in Europe or the NBA’s G League compete collegiately.
“Fair competition cannot occur without a consistent set of rules concerning pay-for-play or player eligibility that cannot be endlessly relitigated in court,” Trump’s order states.
The executive action comes after years of chaos triggered by court rulings that stripped the NCAA of its ability to limit athlete compensation. Under the current Name, Image, and Likeness (NIL) system, athletes can sign contracts worth millions and transfer freely between programs at the end of every season. Critics say the arrangement has effectively turned major college football and basketball into semi-professional leagues.
Trump’s order warns that the current trajectory could force universities to eliminate non-revenue sports and threatens “the overall financial well-being” of schools with federal funding relationships. Universities are being “driven into debt,” the order says, while women’s and Olympic sports face cuts to fund ever-escalating football and basketball rosters.
The “Power 4” conferences, which include the SEC, Big Ten, Big 12, and ACC, praised Trump’s move and called again for Congress to pass permanent legislation. Hall-of-fame Alabama football coach Nick Saban also lauded the order, saying it would help “manage and fund all sports” and preserve opportunities for young athletes.
Legal challenges are expected. Courts have consistently sided with athletes on NIL compensation issues, and the order urges Congress to codify the restrictions into law to withstand judicial scrutiny.
The SCORE Act, a piece of legislation introduced in the House last summer to address NIL and eligibility rules, has bipartisan support but has stalled in committee.
