Once upon a time, people who owned sports franchises, like those who owned newspapers, weren’t in it for the money. Getting their names and faces in the local news in connection with beloved local institutions was satisfaction enough in itself. But like almost everything else in these post-storybook days, respect and celebrity have been monetized, and sports franchises, like news platforms, are expected to make not just a positive personal image for the boss, but a buck; in fact, as many bucks as the law allows.
And by and large they do, especially those big-time sports properties, which turn over coin and appreciate in value like few other businesses, in part because of some specific tax advantages the laws allow.
Take the case of Steve Balmer, the former Microsoft CEO who is the owner of the National Basketball Association Los Angeles Clippers. His spokesperson says, “Steve has always paid the taxes he owes, and has publicly noted that he would personally be fine with paying more.”
But in the meanwhile, a recent investigation by the Pro Publica team of Robert Faturechi, Justin Elliott and our guest today, Ellis Simani found, Balmer used his basketball ownership to pay less, probably more than $100 million in federal taxes.
As ProPublica figured it, Balmer paid taxes at a 12 percent rate, one-third of the tax rate paid by his league’s greatest super-star LeBron James and two percentage points lower than what a part-time ballgame beer seller and Uber driver paid on her taxes. According to Pro Publica’s research, Balmer had $656 million in income the same year the beer lady Adelaide Avila made $44,000.
A fabled NBA slogan was, “I love this game!” When NBA owners use it, it’s fair to ask what game they love — is it basketball or avoiding taxes.
Bill Veeck, a self-described “Chicago hustler” who owned Major League Baseball’s St. Louis Browns and Chicago White Sox in the middle of the last century, was a maverick who bought ballclubs for the best of reasons — he had fun running them.
He also had fun running down the public patriotism and private greed of his fellow-owners. “Look,” he wrote in his memoir, “we play the Star Spangled Banner before every game. You want us to pay income taxes too?”
Ellis Simani is a data reporter. Previously, he was a Scripps Howard data reporting fellow at ProPublica. Before joining ProPublica, he was a Metpro fellow on the Los Angeles Times’ data visualization desk. There, he covered a variety of topics ranging from visualizing environmental issues along California’s coast, to investigating the shortcomings of the Census Bureau’s racial categories. Prior to his work at the Los Angeles Times, Ellis interned with the Seattle Times’ News Apps team, and was a participant in ProPublica’s Data Institute in 2017.