The bill amends RCW 28B.10.703 and creates new statutory sections to prohibit public institutions of higher education in Washington from entering, maintaining, or permitting agreements with private capital firms or sovereign wealth funds that transfer ownership or revenue interests in, grant control rights over, or create joint ventures that give those firms or funds any share of athletics-related revenues, rights, or athletics facilities. It defines key terms including "control rights," "intercollegiate athletics program," "private capital firm," and "sovereign wealth fund." The measure also lists exceptions that remain allowed (for example, fee-for-service contracts for discrete services, charitable gifts, tax-exempt bond financing and certain lease-purchase agreements that do not convey revenue or control, and sponsorships that provide brand placement without revenue sharing or control). The bill imposes procedural requirements on governing boards and institutions: annual certification that the institution and its affiliates have not entered prohibited agreements, public disclosure of any agreements relying on an exception, annual reporting to the legislature’s appropriate higher education committees, and adoption of rules after consultation with the state treasurer and the Department of Financial Institutions, with a directive to harmonize definitions with federal securities law where practicable. It extends the prohibitions and requirements to affiliates, collectives, foundations, and separate legal entities directly or indirectly owned, controlled, or operated by the institution or its athletics department. Existing agreements in effect on the section’s effective date must be brought into compliance or terminated within 24 months and may not be renewed or extended without compliance. The text does not specify the act’s effective date, does not set out enforcement mechanisms or penalties, does not specify the timing or detailed procedures for rule adoption, and does not identify which specific legislative committees are the recipients of the annual reports.

If enacted, colleges and universities in Washington would no longer be able to sell or pledge shares of their athletics revenues, control over athletic decisions, or interests in athletic facilities to private equity, hedge funds, investment advisers, or foreign sovereign wealth funds, which likely closes off a source of outside capital that some schools and conferences have used to monetize media, ticketing, naming, or sponsorship rights. Institutions and their athletics affiliates will probably need to renegotiate or terminate existing deals within 24 months, which could mean legal and transaction costs, potential loss of pledged revenue streams, and reduced options for large up-front financing from those types of investors; private funds and sovereign wealth entities would lose access to those revenue-sharing or control arrangements in Washington schools. Governing boards must take on new compliance work: annual certifications that prohibited deals do not exist, public disclosure of any allowed exceptions, annual reporting to higher education committees, and rulemaking in consultation with the state treasurer and the Department of Financial Institutions. That shifts administrative burden and oversight onto boards and school finance offices and increases transparency, but the bill leaves unclear the exact effective date, enforcement mechanisms, and specific rule procedures, creating practical uncertainty for institutions and investors as they plan contract changes.