Minnesota has NO state legislative vacuum law — “Legislative Vacuum” (SF 2909 is NOT a legislative vacuum bill). Strategic advantage: no laws that can be repealed for House to fix. UMN agreed to a full cap of $20.5M; Big 5 split (~75% football, ~10-15% men’s basketball, remainder hockey/volleyball/women’s basketball). $8.75M shortfall → $200 student athletic fee. Dinkytown Athletics = “above cap” partner. MSHSL “Amateur Plus” model (high school): strict IP ban + handicap bans. Tax complexity: 9.85% top rate + 2% non-resident artist tax + MI/ND reciprocity. Here is the complete guide.
The Evolution of NIL in Minnesota
Minnesota’s “Legislative Vacuum” = Strategic Asset. The lack of a specific Minnesota legislative act means there are no laws that can be repealed to comply with the terms of the House agreement. The Minnesota Department of Economic Sciences had immediate flexibility to participate.
NO State NO Statute — “Legislative vacuum”:
- Minnesota bypasses the “arms race” of state gun misdemeanor laws (2021-2024)
- There is no Minnesota Vocational Training Equalization Act or Student Athlete Bill of Rights.
- Management delegated to: UMN policy + MSHSL charter + federal antitrust agreements
- NOTE: SF 2909 is NOT a NIGHT Bill—it is a Judiciary/Public Safety bill.
- Strategic advantage: no legislative impediments blocking a House agreement
- First-mover advantage against states that repeal outdated laws (Texas, Florida, Alabama)
University of Minnesota — full funding of $20.5 million:
- Billboard Mark Coyle: Committed to spending the FULL amount of $20.5 million
- “Competitive necessity” — underspending = unilateral disarmament
- The limit is calculated based on 22% of the average Power 5 sports revenue
- 4% annual escalator (~$21.3 million in 2027)
- Damages: NCAA/Big Ten Distribution Reduction
The Big Five distribution model:
- Football: ~75% ($15.375 million) — main source of income, roster of 105 players
- Men’s basketball: ~10-15% ($2-3 million) — cost per player $500-800k
- Remaining ~10% ($2 million): women’s basketball, volleyball, men’s hockey
- “Hockey Anomaly”: Uniquely Minnesotan — the Blue Bloods Program in Income Distribution
- Vulnerability: Hockey competition against schools that prioritize hockey (UND, Denver)
Deficit of $8.75 million — $200 subject to student athletic participation:
- No legislative “rescue” from the government surplus
- General Higher Education Bill: ~$1.5 billion for UMN, but WITHOUT subsidies
- Board of Regents approved: fee $200/year ($100/semester)
- “Wealth transfer”: secondary school students subsidize athletes’ salaries
- Exchange: “Free tickets” to some events
- Comparative weakness: OSU/Michigan can close the gap without students paying tuition
Dinkytown Athletes Team — Hybrid Model:
- Official NIL Gopher Athletics Team
- Post-Settlement Role: “Above Capitalization” Strategic Partner
- The University provides a base budget (limit of $20.5 million); the Staff provides additional
- Example: 5-star quarterback gets $2 million; UMN offers $1.5 million → DTA closes $500k gap
- Co-founders: Rob Gage, Derek Burns
- Integration of the “MINDset” program: training in athlete branding
- Must pass the “Real Business Purpose” test (College Athletic Commission)
- Transition from the “sales agent” model to the “marketing agency” model
Tax complexity — 9.85% + tax on artists:
- Highest in Minnesota: 9.85% (one of the highest in the country)
- Tax for non-resident artists: 2% of gross remuneration
- Dual classification: W-2 (income share) + 1099 (collective NIL)
- Reciprocity with MI and ND: W-2 wages are tax-exempt, but 1099 is unclear
- Disadvantageous recruiting approach compared to Texas/Florida (0% state income tax)
Chapter IX — “Olympic Sports Compression”:
- The Big Five allocate ~75% to football, which is legally unstable under Title IX
- Defense: Payments = “market transactions”, not “educational benefits”
- Mitigation: 11 new scholarships (6 women’s, 5 football)
- “Two-tier caste system”: professional class vs. amateur class
- 15+ Olympic sports do not receive any direct revenue sharing
Why Minnesota matters:
Minnesota = “Legislative vacuum” (no state law NIL) = maximum flexibility. UMN committed to full $20.5M cap with Big 5 allocation. $8.75M shortfall → $200 student athletic fee (wealth transfer). “Dinkytown Athletes” = hybrid “above cap” partner. MSHSL “Amateur Plus” = strict high school caps. Tax complexity: 9.85% + 2% entertainer tax + reciprocity traps. Title IX deals with “Olympic Sports Squeeze.”
Minnesota College NIL Rules
No state charter = governed by NCAA rules, House settlement terms, and UMN institutional policies. Hybrid model: university revenue sharing ($20.5 million cap) + Dinkytown athlete pool (“above cap”).
What Minnesota offers:
- Maximum operational flexibility (“clean slate” — no restrictive laws)
- Full revenue sharing cap of $20.5 million (Big Ten competitive price)
- Dinkytown Athletes Team for Over-Cap Deals
- Note: Maximum tax rate 9.85% (disadvantageous situation compared to Texas/Florida)
UMN Infrastructure:
- Big Five distribution: football, men’s basketball, hockey, volleyball, women’s basketball
- Dinkytown Athletes (Rob Gage, Derek Burns)
- Branding/educational program “MINDset”
- College Athletic Commission Information Center Compliance
Minnesota High School NIL Rules
MSHSL “Amateur Plus” model (approved June 2022): Allows monetization with strict protections against professionalization. Defined by prohibitions rather than permissions.
Key facts:
- Governing Body: Minnesota State High School League (MSHSL)
- Status: “Permitted” with strict restrictions
- Policy approved: June 2022
Allowed activities:
Allowed: Training camps (youth training), autograph signings, social media advertising, coaching lessons. Athletes may hire agents/lawyers to review contracts (but not “marketing representation”).
MSHSL prohibitions in the “danger zone”:
Intellectual Property Ban: No use of school uniforms, logos, mascots, or names. Even a “blurred” logo = violation. Commercial identity must be separated from school identity.
“Vice” Clause: Gambling (including sports betting apps), alcohol, tobacco, cannabis, adult entertainment, weapons. Includes “bar and grill” if alcohol is the primary focus. “Pay-to-play” prohibited: Compensation cannot be contingent on results ($100/touchdown) or accolades (car for signing).
“Gray Zone” – groups aimed at high school students:
MSHSL prohibits school inducements from paying athletes. BUT: If Dinkytown Athletes signs high school players BEFORE they enroll at UMN, does that violate MSHSL? The policy says “no inducements to recruit.” Proving that the deal was an inducement, not fair market value for “social media influence” = difficult. Next hot spot: The college-recruitment war is seeping into high school.
College vs. High School: Key Differences
| Feature | College (No State Statute) | High School (MSHSL) |
|---|---|---|
| NIL Status | Legal (institutional policy) | Amateur Plus" (permitted) |
| State Statute | NONE (SF 2909 ≠ NIL) | MSHSL policy (June 2022) |
| Revenue Sharing | $20.5M cap (full commitment) | N/A |
| School Logos/Uniforms | Allowed | Strictly prohibited |
| State Income Tax | 9.85% top rate | 9.85% top rate |
| Vice Industries | Per NCAA rules | Vice Clause" bans |
| Collective Model | Dinkytown Athletes" (above-cap) | Collectives = "gray zone" |
| Agent Representation | Allowed | Contract review only |
Key Difference: Minnesota = “Legislative Vacuum” (no state law NIL) = maximum flexibility. UMN committed to full $20.5M cap with Big 5 split (Football ~75%). $8.75M shortfall → $200 student athletic fee. Dinkytown Athletes = hybrid “above cap” partner. MSHSL “Amateur Plus” = strict IP ban + handicap ban. Tax complexity: 9.85% + 2% entertainer tax. Title IX applies to “Olympic Sports Squeeze.”
What Minnesota athletes can do
College Athletes (UMN):
- Receive a direct income distribution (W-2 form from the university)
- partner with “Dinkytown Athletes” to make deals that exceed capitalization (1099)
- participate in the “MINDset” branding program
- sign advertising agreements with brands
- monetize social media accounts
- earn money from camps, seminars and speeches
- Get fan support through platforms like RallyFuel.
High school athletes:
Conducting training camps (youth training); signing autographs; posting on social media; coaching lessons; hiring agents/lawyers to review contracts (not marketing representation).
What Minnesota athletes can’t do
College athletes:
Cannot advertise: gambling, tobacco, adult entertainment, controlled substances (NCAA rules)
Foreign students (F-1 visa): cannot engage in active unpaid study in the US, must pass the “genuine business purpose” test for collective bargaining agreements (College Sports Commission Clearinghouse).
High school athletes:
- You cannot use the school uniform, logo, mascot or name (even blurred)
- You may not appear in a university t-shirt for commercial purposes.
- Cannot advertise: gambling, sports betting apps, alcohol, tobacco, cannabis, adult entertainment, weapons
- You can’t accept “bar and grill” offers if the main focus is alcohol
- You cannot accept performance bonuses (“$100 per touchdown”)
- You cannot accept incentives for enrollment.
Both:
- Must pay Minnesota state income tax (progressive up to 9.85%) + federal tax + self-employment tax
- Non-residents may pay 2% artist tax; Must maintain academic eligibility.
Compliance requirements
For college athletes:
UMN:
- Obtain Form W-2 for Income Distribution (Employee Classification)
- Receive a 1099 form from Dinkytown Athletes (independent contractor)
- Report all transactions >$600 to the College Athletic Commission Information Center
- Ensure that deals pass the “genuine business purpose” test
- Understand double taxation status (W-2 + 1099 = two “jobs”)
- Reciprocity: Michigan/North Dakota residents file Form MWR for tax exemption on Form W-2; 1099 status under reciprocity = unclear (potential trap).
For high school athletes:
- NEVER use the school uniform, logo, mascot, or name
- NEVER advertise products with a “defects clause”
- NEVER accept compensation based on performance or enrollment
- Understand agent limitations (contract review only, not marketing representation)
- Beware of the “gray area” of college collective bargaining agreements before enrolling.
For parents:
For college:
- no state statute NIL = governed by institutional policy
- UMN = full limit of $20.5 million with Big Five distribution
- “Dinkytown Athletes” fills gaps above the cap 9.85% state tax + 2% artist tax = recruiting disadvantage compared to Texas/Florida
- dual W-2/1099 status = complicated tax filing
- Michigan/North Dakota reciprocity can help (MWR form).
For high school:
- MSHSL “Amateur Plus” = allowed but limited; strict no-intellectual property (no school uniforms/logos)
- “Vice Clause” = broad prohibitions
- “Gray zone” = college teams geared towards high school students.
How fans support Minnesota athletes
Minnesota has ardent Gopher fans and now they can directly support the athletes through the NIL.
College athletes:
Platforms like RallyFuel allow Minnesota fans to support athletes at:
- University of Minnesota – Big Ten (Power Four)
- All sports – football, basketball, hockey and others
NIL infrastructure in Minnesota:
UMN Revenue Sharing: $20.5M annual cap. Big 5 distribution. W-2 employee classification. Dinkytown Athletes Team: Over-Cap Partner. Fills the gap for elite talent. Must pass the “Real Business Purpose” test. Co-Founders Rob Gage, Derek Burns. MINDset Program: Athlete Branding Training. Integrated with Team.
How it works:
1. Create an account on RallyFuel.com or the mobile app
2. Select the University of Minnesota
3. View verified athletes currently in your program
4. Support the athletes you want to support
5. Track your support through the fan dashboard
How it works: When you purchase Fan Fuel, you are purchasing Conditional No-Entry Entitlements (CNER). If the conditions are met, RallyFuel or its affiliate offers the athlete a NIL deal. If the conditions are not met, for example if the athlete moves to another team, you receive an automatic refund.
Contingency Protection: RallyFuel’s contingent model protects Fan Fuel with automatic refunds if athletes move to other countries or conditions are not met. Minnesota fans can support players without financial risk.
Important: Support for fans through RallyFuel is voluntary and conditional. Fuel purchases are not charitable donations. RallyFuel does not guarantee that any athlete will accept the No Donation Agreement. Fuel purchases for fans do not guarantee athletic performance, playing time, or any specific outcome.
High school athletes:
Minnesota high school athletes may utilize NIL opportunities under the MSHSL’s “Amateur Plus” policy, provided they never use school uniforms, logos, or names and avoid all prohibited “Vice Clause” products.
Learn more about the NIL landscape
Name, image, and likeness play an increasingly important role in college sports, and understanding how it works often requires more than individual articles or news stories.
RallyFuel is a platform focused on topics related to modern college athletics (NIL). It brings together information about athletes, NIL activities, and the broader structure of modern college athletics, helping readers explore the topic in greater depth.
Frequently asked questions
Can Minnesota high school athletes pass the NIL?
Yes. MSHSL “Amateur Plus” policy (June 2022) allows: boot camps, autograph sessions, social media advertising, coaching classes. Strict prohibitions: no use of school uniforms, logo, mascot, or name; no promotion of gambling, sports betting, alcohol, tobacco, cannabis, adult entertainment, weapons; no acceptance of performance bonuses or enrollment incentives. “Gray Zone”: College teams targeting high school seniors before enrollment = new enforcement challenges.
Why doesn’t Minnesota have a statewide NIL law?
“Legislative vacuum” = calculated inaction (prudence or deadlock). Minnesota bypassed the “arms race” of state unlicensed justice legislation (2021-2024). NOTE: SF 2909 is NOT an unlicensed justice bill, but an omnibus justice/public safety bill (victim compensation, correctional funding). Strategic advantage: no legislative hurdles blocking House resolution. UMN faced no legal hurdles at the state level to get involved immediately. First mover advantage over states repealing outdated laws (Texas, Florida, Alabama). Legislative influence is indirectly through the omnibus higher education bill (no unlicensed justice subsidy → tuition is $200).
What is the Big Five distribution model?
$20.5M cap allocated to 5 sports: Football ~75% ($15.375M) – main source of revenue, 105-player roster; Men’s basketball ~10-15% ($2-3M) – cost per player $500K-$800K; Remaining ~10% ($2M) split between women’s basketball, volleyball, and men’s hockey. “Hockey anomaly”: unique to Minnesota – Blue Bloods program receives revenue share. 15+ Olympic sports do not receive direct revenue sharing → “Two-tier caste system.” Title IX risk: ~75% for football is legally unsound; protection = “market transactions” not “educational benefits.”
What are “Dinkytown Athletes”?
Official Gopher Athletics team, not in NIL status. Post-Settlement Role: “Above Cap” Strategic Partner. Hybrid Model: University provides base salary ($20.5M cap); Team provides add-ons. Example: 5-star quarterback makes $2M; UMN offers $1.5M cap → DTA closes $500K gap. Co-Founders: Rob Gage, Derek Burns. Integrate MINDset for athlete branding. Now must pass “real business purpose” test (College Sports Commission Clearinghouse). Move from paying “assistant” to a “marketing agency” model with true ROI activation.
What are the tax implications for Minnesota?
Highest rate in Minnesota: 9.85% (one of the highest in the country). Dual classification: Income Split = W-2 (employee); Collective NIL = 1099 (contractor). Non-resident entertainer tax: 2% of gross compensation for athletes performing in Minnesota. Reciprocity with MI and ND: W-2 wages exempt (file MWR); 1099 unclear (potential “trap”). Recruiting disadvantages: Same gross NIL proposal = significantly higher net pay in TX/FL (0% state income tax) compared to MN. Athletes effectively work “two jobs” with complicated tax filing.
What happens if an athlete I supported transfers?
If an athlete transfers or chooses another school during the conditional period, you will receive an automatic refund to your original payment method. No manual request is required.
Minnesota: Legislative vacuum meets Big Ten ambitions
Minnesota has NO statewide statute of limitations — “Legislative vacuum” = strategic asset. SF 2909 is NOT a statute of limitations (Omnibus Court System/Public Safety). No laws that can be repealed to meet House agreement = first-mover advantage. UMN committed to reaching full cap of $20.5M with Big 5 allocation: Football ~75% ($15.375M), Men’s Basketball ~10-15% ($2-3M), remainder Women’s Basketball, Volleyball, Men’s Hockey (“Hockey Anomaly” = unique to Minnesota). $8.75M shortfall → $200 in student athletic fees (“wealth transfer”). Dinkytown Athletes = hybrid “above the limit” partner (Rob Hegg, Derek Burns); MINDset branding program; must pass “Real Business Purpose” test. MSHSL “Amateur Plus” high school model: strict IP ban + “spoofing” bans; “gray area” = senior-oriented college teams. Tax complexity: 9.85% top rate + 2% non-resident artist tax + reciprocity for minors/non-residents (W-2 exempt, 1099 unclear). Title IX re: “Olympic Sports Squeeze” creates a two-tiered caste system.
For college athletes ready to maximize their potential without injury, RallyFuel offers fan support with conditional protection. Meet Minnesota’s proven athletes and start fueling today.
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