Warriors

Warriors' tax bill projected to drop $66M based on NBA revenue

Warriors

The NBA and the National Basketball Players Association on Nov. 9 officially agreed to changes in the collective bargaining agreement in order to move forward with the 2020-21 NBA season.

One provision states that "tax payments will be reduced in proportion to any BRI [basketball-related income] decreases," which certainly will help minimize the Warriors' luxury tax bill.

By how much exactly? Well, ESPN's Bobby Marks on Tuesday morning tweeted that if the league sees a 40 percent dip in total revenue, the check Golden State eventually sends the NBA will total $71.1 million instead of $137.2 million -- a drop of over $66 million.

Keep in mind that this number assuredly will change some, as Golden State has until the end of the regular season to finalize its roster. In other words, the Warriors' tax bill will change if they make alterations to the roster that either increase or lower total salary obligations.

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Additionally, team and league revenue will be impacted significantly if large numbers of fans are allowed at games later in the season. The hope is that thousands of people will be permitted in arenas by the time the playoffs arrive in mid-May.

The Warriors begin a seven-game homestand Jan. 1, and won't have any fans at Chase Center until positive COVID-19 cases dramatically decrease in the Bay Area.

 

So how much financial trouble will the franchise be in if nobody is allowed inside Chase all season?

"It's about as bad as you could ever imagine," owner Joe Lacob told The Athletic's Tim Kawakami shortly after last month's NBA draft. "I don't think people want to hear about that. If I was a fan I wouldn't really want to hear about it either.

"But it's really bad for the entire NBA, and us in particular ... but we've planned for it. We did increase our debt capacity this summer. The losses are gonna be even greater -- well into the multiple hundreds of millions it appears, unless we miraculously are able to have fans as the months move on.

"But we're prepared for it. A good business should be prepared for it, and we're prepared."

RELATED: What Joe Lacob passionately told front office after Klay news

Just to be clear -- is that hundreds of millions in income, or overall?

"I'm not talking about lost revenue. I'm talking about losses -- revenue minus the expenses," Lacob said. "How much you have to write a check for, or come up with out of your pocket.

"It's well into the multiple hundreds of millions for us."

This certainly will be a story to follow as we get deeper into 2021.

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