Grant Wahl had an opportunity to do a one-on-one interview with MLS Commissioner Don Garber this week on SI.com, and there is a ton of interesting information and answers from Garber in it, on a wide range of issues.
Since we cover LAFC here, Wahl asked about the MLS expansion team, and got a pretty interesting response from Garber regarding the $110 million expansion fee paid by the 24-member ownership group.
SI: When a new ownership group like LAFC pays a $110 million expansion fee to the league, I assume they don't just write a $110 million check to MLS and hand it to you. Over how many years does that money come in, and how is it distributed once it does come in?
Garber: The LAFC owners wrote a $110 million check upon closing. And that money is distributed to the MLS owners in payment for the dilution of their interest in MLS. They now have a partner that will share in revenues and will help them basically work together to grow the league.
SI: Interesting. Was it at least one of those oversized checks you see on TV shows?
Garber: (laughs) By the way, it's the only time an ownership group has come in and paid its expansion fee in full [at the start]. The other ones have been spread over time.
SI: Why was LAFC different?
Garber: I just think we're at the point now that's something that makes more sense for our ownership group.
SI: And the $110 million check cleared?
Garber: (laughs) It cleared.
I mean, paying that much money up front was probably an indication of how serious this latest group was about trying to make a second team in Los Angeles work, and probably helped seal the deal. It's also pretty impressive to amass that kind of money and pay it in one installment.
It also answers a question I had about LAFC versus some of the other expansion teams. LAFC was in the same boat as Atlanta United FC in that they were "officially" in MLS, even without a stadium deal complete (unlike Atlanta, which had one from day one), as of the announcement of their establishment in Oct. 2014. On the other hand, there were a couple strings attached for Minnesota United, who have gotten a stadium deal and look as good as official, and David Beckham's quixotic Miami bid, which has major strings attached pending a stadium deal and is still not yet official, even though that club was announced 22 months ago.
I would speculate that LAFC clinched the deal because there were already plans moving between MLS and the LAFC owners prior to October 2014 about a stadium deal and because they wrote that $110 million check and paid it all up front. Once you've devoted that much money to something, you aren't going to back out of it, and neither is the entity getting paid.
One other tidbit from the interview, which is a must-read for MLS fans, is that Garber reiterated that LAFC will start play in 2018. That is the official line from the club, of course, but there was that one report that said the start date could be pushed back once again. The Commissioner is holding firm on '18, however, at present.
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