NFL and club executives have agreed on a proposal to raise the debt limit for each team from $350 million to $500 million for the 2020 season, league and ownership sources told ESPN.
The agreement, reached during a conference call Monday, is a response to the financial uncertainties caused by the coronavirus pandemic, the sources said. Owners will vote on the proposal May 19. A league spokesman didn’t respond to a request for comment.
The increased debt limit has been discussed among league and team executives for weeks, as clubs push for access to extra money in case games must be played without fans this season. It could cost clubs tens of millions of dollars in local revenue if games are played in empty stadiums.
Patrick Rishe, who directs the sports business program at Washington University in St. Louis, conducted an analysis for ESPN that estimated the sudden vanishing of sports would erase at least $12 billion in revenue even before figuring any impact for the NFL and college football.
According to his estimates, the NFL would lose about $138 million in revenue from tickets and game-day fan spending for each week played without fans. A full season without fans could cost the league nearly $2.3 billion, Rishe calculated.
It’s not unusual for the league to raise the debt limit for teams, but such a move is usually reserved for clubs that are building new stadiums.
Nobody knows what the 2020 season will look like. The league is planning to begin as scheduled, with the Kansas City Chiefs hosting the Houston Texans on Thursday, Sept. 10, but the league and teams are working on contingency plans in the event the start of the season is delayed.