Newsom signed a bill Monday (September 30) to allow US athletes to hire agents and make money from endorsements but the California bill won't come into effect for 27 months.
Newsom is hoping the bill, called Fair Pay to Play Act, has a domino effect.
"It's going to initiate dozens of other states to do similar legislation. And it's going to change college sports for the better by having now the interest, finally, of the athletes on par with the interests of the institutions," said Newsom. "Now we're rebalancing that power arrangement."
The bill, which comes into effect in January 2023, threatens to disrupt the business model of American college sports and in June, NCAA President Mark Emmert said if the bill became California law, schools in the state could be prohibited from participating in NCAA championships.
"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," an NCAA spokesman said on Monday.
"Unfortunately, this new law already is creating confusion for current and future student-athletes, coaches, administrators and campuses, and not just in California."