Notice NBA/NBAPA agree on new collective bargain agreement

[Mediocre Man]

It says players will have the ability to invest, not that owners are required to sell to them.

I don't like the move, but then, I feel most things that give players more control results in a worse product.

But if they are investing, isn’t that cutting into the owners profits?

 

[wizenheimer]

But if they are investing, isn’t that cutting into the owners profits?

that's probably a real complicated formula.

If someone owns 100% of teams, yes, they'd get 100% of whatever profits are generated. Of course, those profits would likely be taxed as dividends; and for high income people, interest and dividend income usually are taxed at the higher levels allowed by the IRS and states

however, if that owner has owned the team for longer than a year, then the proceeds from a partial sale would very likely be taxed as long-term capital gains. This nation, being in the pocket of the wealthy, sets the maximum federal tax rate on capital gains as 15%

so, for instance, somebody like Mark Cuban, who lives in Texas, which has no state income tax, could sell 10% of the Mavs...say for 400M, and put 340M in his pocket after taxes.

now, all that was true before the NBA decided players could buy into teams, so nothing is really changing as far as tax after sale. I'd wonder though about several things. Say Mark Cuban was looking at one of his players, like Doncic, approaching a new contract negotiation, and likely eligible for a max deal. Could Cuban offer that player a heavily discounted buy-in to the team in exchange for that player agreeing to a contract well below a max deal? Could it involve Cuban 'loaning' that player the buy-in amount with no-interest loan terms applied to future earnings?

What if the Mavs have a market value of 4 billion. But Cuban sets the partial sale value of the Mavs at 1 billion, then sells 5% of the team to that player for 50M; that when the actual market value of that 5% was 200M? The IRS is kind of geared to deal with sweetheart deals like that (and many forms of those deals are actually legal as long as the feds get their cut). But how will the NBA, thru the CBA, deal with that? Will the difference between the discounted price and the market value count against the Mavs salary cap? I can't imagine how the NBA could calculate that.

I'm not a CPA or financial advisor. We have some of those people posting here so they could speak about this more informed than me. But it sure seems like the NBA could be opening up a giant can of worms with these rules. There's just too much fertile ground for shenanigans.

 

[blazerkor]

What's the conflict? You think if Dame finds out 57% of the money went on his opponent that he'd throw the game? The financial gain would be incredibly small in a scenario like that.

If someone wanted to throw games, they would already be doing it, without the need to water down the profits by owning a share of a sportsbook.

Betting is so nuanced that it doesn't have to be throwing games. I just think that it would be incredibly hard to trust every player in the league to have the integrity to never shave a point if they knew what the line was and that bets had come in very heavy one way or another. It's the image of possible impropriety that the league really just doesn't need. There are already a ton of crackpots in this forum who think that games are fixed, so now the league wants to add players invested in sports gambling... doesn't make a lot of sense to me.

I don't mind players being able to be part owners of the team they play for but then again that provides a lot of complications I don't know the league needs either but at least they aren't problems that pose a risk to the integrity of the game. I don't imagine the league would allow players to own part of a team that they play against but hey if they're letting players invest in sports gambling who the fuck knows?

 

[blazerkor]

that's probably a real complicated formula.

If someone owns 100% of teams, yes, they'd get 100% of whatever profits are generated. Of course, those profits would likely be taxed as dividends; and for high income people, interest and dividend income usually are taxed at the higher levels allowed by the IRS and states

however, if that owner has owned the team for longer than a year, then the proceeds from a partial sale would very likely be taxed as long-term capital gains. This nation, being in the pocket of the wealthy, sets the maximum federal tax rate on capital gains as 15%

so, for instance, somebody like Mark Cuban, who lives in Texas, which has no state income tax, could sell 10% of the Mavs...say for 400M, and put 340M in his pocket after taxes.

now, all that was true before the NBA decided players could buy into teams, so nothing is really changing as far as tax after sale. I'd wonder though about several things. Say Mark Cuban was looking at one of his players, like Doncic, approaching a new contract negotiation, and likely eligible for a max deal. Could Cuban offer that player a heavily discounted buy-in to the team in exchange for that player agreeing to a contract well below a max deal? Could it involve Cuban 'loaning' that player the buy-in amount with no-interest loan terms applied to future earnings?

What if the Mavs have a market value of 4 billion. But Cuban sets the partial sale value of the Mavs at 1 billion, then sells 5% of the team to that player for 50M; that when the actual market value of that 5% was 200M? The IRS is kind of geared to deal with sweetheart deals like that (and many forms of those deals are actually legal as long as the feds get their cut). But how will the NBA, thru the CBA, deal with that? Will the difference between the discounted price and the market value count against the Mavs salary cap? I can't imagine how the NBA could calculate that.

I'm not a CPA or financial advisor. We have some of those people posting here so they could speak about this more informed than me. But it sure seems like the NBA could be opening up a giant can of worms with these rules. There's just too much fertile ground for shenanigans.

The conflict I guess I could see with players owning a part of the team they play for could become a matter of salary cap dodging. If the player owns a significant enough portion of the team then it starts to behoove the player (as an owner) to take a lower salary so he can make more profit off of his team by spending the salary they would make on a player who is as big or a bigger attraction to fans and advertisers.

I mean both the gambling thing and the team ownership thing seem to me to be opening pandora's box on a whole shit ton of chaos. I just don't know why the league wants this or would agree to it.

 

[Tince]

Betting is so nuanced that it doesn't have to be throwing games. I just think that it would be incredibly hard to trust every player in the league to have the integrity to never shave a point if they knew what the line was and that bets had come in very heavy one way or another. It's the image of possible impropriety that the league really just doesn't need. There are already a ton of crackpots in this forum who think that games are fixed, so now the league wants to add players invested in sports gambling... doesn't make a lot of sense to me.

I don't mind players being able to be part owners of the team they play for but then again that provides a lot of complications I don't know the league needs either but at least they aren't problems that pose a risk to the integrity of the game. I don't imagine the league would allow players to own part of a team that they play against but hey if they're letting players invest in sports gambling who the fuck knows?

Couldn't all the things you're worried about be happening now?

You bring up an interesting point regarding ownership. Say Dame buys a 2% share in the Blazers, then gets traded, do you think he'll be forced to sell his share in the team?

 

[blazerkor]

Couldn't all the things you're worried about be happening now?

You bring up an interesting point regarding ownership. Say Dame buys a 2% share in the Blazers, then gets traded, do you think he'll be forced to sell his share in the team?

The fact is if point shaving was going on right now the NBA could investigate to see if there is any kind of paper trail... like financial records linking players to sports books. If the player owned the sports book, it would be very hard for the league to prove intent. It could be going on right now but if the league looked into it, it would be very clear if it was. The idea that players would be partners in sports books would muddy the waters probably to the point of complete opacity.

As far as the team ownership goes, I don't think anything about that would hurt the image of the game's integrity. I do think the point you bring up is a problem. Players invest and then have to liquidate when they change teams, seems like a mess. If the player has enough of their net worth invested into the team then they would be very quick to take a pay cut in order to increase the profits of the team...

None of it makes sense to me.

 

[Tince]

The fact is if point shaving was going on right now the NBA could investigate to see if there is any kind of paper trail... like financial records linking players to sports books. If the player owned the sports book, it would be very hard for the league to prove intent. It could be going on right now but if the league looked into it, it would be very clear if it was. The idea that players would be partners in sports books would muddy the waters probably to the point of complete opacity.

As far as the team ownership goes, I don't think anything about that would hurt the image of the game's integrity. I do think the point you bring up is a problem. Players invest and then have to liquidate when they change teams, seems like a mess. If the player has enough of their net worth invested into the team then they would be very quick to take a pay cut in order to increase the profits of the team...

None of it makes sense to me.

A player who point shaves one game that makes up 0.001% of a sportsbooks revenue wouldn't receive near enough value. A player who point-shaves a single game would make a ton more money getting paid from a 3rd party who was profiting off the game being fixed.

I guess I just don't see this as near of a concern as you do.

 

[SharpesTriumph]

Wow! I would hope the players have to be on the NBA team that they invest in and have to liquidate if they are traded or choose to leave via free agency. The gaming/sports gambling thing is a little surprising and weird to me... I don't think I like the idea of a professional athlete basically being a bookie, instant conflict of interests.

Invest in sport betting platforms is extremely different than investing in a bet of a single sports game.

 

[SharpesTriumph]

But if they are investing, isn’t that cutting into the owners profits?

The owners know enough about business and have enough experts on their payroll to handle negotiating a sale of a tiny fraction of their business.

I just don't see any need for concern a $3-8+ billion owner will sell a tiny stake in a team to a player and get a bad deal.

 

[KingSpeed]

This..... @KingSpeed never said i wouldnt watch just makes no sense on why its even there in the first place, it legit makes no difference they are just putting lipstick on a pig and calling it sally.

You said you wouldn’t give a shit. That sounds like you wouldn’t watch.

 

[cdub503]

You said you wouldn’t give a shit. That sounds like you wouldn’t watch.

sounds like you assumed I wouldn’t watch. I am saying that the actual tournament wouldn’t make me tune in one way or the other. If I’m able to watch the game I’m able to watch the game. However with the championships. I will make more of an effort to watch because I give more of a “shit” about it. Or the implications of the game. IE winning a ring. With this mid season tournament I could give two shits if dame wins more money because he won a game in the middle of the season that he would have been playing anyways. That to me has no value other than what amount of money he won. Make sense?

If anything it’s a money grab for the players without it affecting the team payroll. Least that’s the way I see it. I just wish it was outside of the regular season. Tacking it into the middle of the season makes no sense to me.