Following a report Sunday from Sports Illustrated over alleged racial and sexual workplace misconduct by Carolina Panthers owner Jerry Richardson, the 81-year-old franchise founder made the shocking announcement that he will sell the team at the end of the 2017 season.
On Monday afternoon, the Panthers announced that Richardson is stepping aside from the team’s day-to-day operations, effective immediately. Tina Becker, who has been with the team for two decades, is taking over as chief operating officer.
At this point, there are more questions than answers surrounding the proposal to sell the team. We took a look at some of them.
Q. Why is this such a surprise?
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A. Bringing the Panthers to Charlotte has been a life’s goal for Richardson, now 81. A native Carolinian who is the only current owner to have also played in the NFL, Richardson began the process of trying to obtain an NFL team for Charlotte in 1987 and was awarded the franchise on Oct. 26, 1993.
Back in 2012 and 2013, when the Panthers were negotiating a taxpayer contribution toward stadium renovations, team representatives told Charlotte officials the Panthers would be sold within two years of Richardson’s death because of tax implications.
Q. How much did Richardson pay for the Panthers?
A. Richardson has said he and the other members of the ownership group put in about $220 million to start the team, including a $140 million NFL franchise fee. The public spent $60 million on land and infrastructure for the $187 million stadium, which was paid for by the ownership group and the buyers of permanent seat licenses.
In September, Forbes said the Panthers are now worth $2.3 billion, up 11 percent from last year.
Q. Would all owners sell their stake, even minority owners? Or just Richardson?
A. Neither the team nor the minority owners are providing details on their plan, but in a letter posted Sunday, Richardson said the team would be put up for sale at the end of the season and that it was “time to turn the franchise over to new ownership.”
Richardson said in 2009 he and his family owned 48 percent of the team, with the other 52 percent being owned by a group of about a dozen minority partners. Minority owners, however, in the past have told the Observer that Richardson is firmly in charge based on team governance documents.
Q. Is there a precedent for this kind of thing?
A. The last NFL team to sell was the Buffalo Bills in 2014. After the death of the team’s original owner, Ralph Wilson, Terry and Kim Pegula, owners of the Buffalo Sabres hockey team, bought the Bills for an estimated $1.1 billion.
Q. If a new owner wants to move the Panthers from Charlotte, how much protection does the city have to keep the NFL team?
In April 2013, the Panthers and the Charlotte City Council signed an agreement that called for the public to spend $87.5 million on stadium improvements and game-day expenses. Most of that money – $75 million – was for stadium improvements such as new escalators.
In return, the city said it had a six-year “hard tether” that would keep the Panthers in Charlotte. This current season is the fifth in the six-year tether. The 2018-19 season will be the last in the tether, which officially expires in June 2019. The tether stays in place even if the team is sold.
The contract says that if the team seeks to leave during that window, the city can take them to Mecklenburg Superior Court to prevent them from leaving. But after June 2019, there is no requirement the team stay in Charlotte.
If the team leaves after June 2019, the contract says the city would have either the option of buying the stadium for $1 or the Panthers would pay the city the remaining debt payment on the city’s $75 million investment.
Former Panthers president Danny Morrison, who resigned in February, often said the team didn’t want a new stadium. He said the team likes the “classic bowl” of Bank of America Stadium, which he said has “good bones.” But a new owner might want a stadium that could host large events like Super Bowls and the NCAA Final Four. That would mean a domed stadium or a stadium with a retractable roof. The Atlanta Falcons moved into a new stadium this year that cost $1.6 billion.
Q. How likely is it that the Panthers leave Charlotte?
A. Experts say it isn’t likely the Panthers, under new ownership, leave town.
The city has never been considered at risk of losing its NFL team. Charlotte is affluent, fast-growing and has enthusiastically supported the team since its inception in 1995. When the city was negotiating the hard tether in 2013, city officials worried the Panthers might be sold and moved to Los Angeles, which, at the time, had no NFL teams. Los Angeles now has two NFL teams, the Rams and the Chargers.
“There are so many good aspects of having an NFL team in Charlotte, it would be just shocking to think that someone would find the grass to be greener (elsewhere)” said Todd McFall, a Wake Forest sports economist.
It’s also not cheap to move an NFL team to another city.
ESPN’s Darren Rovell reported in July that the Rams (previously of St. Louis) and the Chargers (previously of San Diego) will each pay $645 million in NFL relocation fees as part of their moves to Los Angeles. Meanwhile, the Oakland Raiders will pay $378 million for their upcoming move to Las Vegas, ESPN reported.
The fees are divided up among the remaining NFL teams.
Q. Who are some possible buyers?
A. The Panthers have a large group of local owners who hold smaller stakes in the team, in addition to Richardson, and it’s possible that some of them could step up to band together and buy the team. Or the Panthers might find a totally new owner, such as local auto racing tycoon Bruton Smith and his family.
On social media, hip-hop Sean “Diddy” Combs (Forbes-estimated net worth: $820 million) quickly said he wants to buy the Panthers.
“It’s time for Black ownership!! The time is now. Let’s make it happen!!,” Combs tweeted Sunday night. “I will have the best halftime show, the best selection of music, and we will win Super Bowl after Super Bowl,” Combs said on Instagram.
Golden State Warriors star and Charlotte native Steph Curry quickly followed up, announcing “I want in!” Former San Francisco 49ers quarterback Colin Kaepernick, out of the league after starting a wave of kneeling protests during the national anthem, followed up Monday and said he wants to join.
Q. Where are possible relocation cities?
A. For years, the biggest city without an NFL team was Los Angeles, but it now has two teams in town – the Rams and Chargers.
Some of the bigger U.S. cities without a team are Portland, Oregon, and San Antonio, Texas. Teams that have recently lost teams or are about to lose teams are San Diego, St. Louis and Oakland. International options include London, Toronto and Mexico City.
Sports Illustrated looked at various options in this August 2017 piece.
Q. Is it possible Richardson doesn’t go through with the sale at the end of this season?
A. Yes, since an intention to sell does not guarantee a sale. It is not uncommon for a business to be put up for sale, and then for the sale to fall through, notes Sports Illustrated legal expert Michael McCann in a story Sunday.
But it seems unlikely that Richardson would change his mind about the sale, said McFall, the Wake Forest economist.
“I think he’d have the full brunt of the investigation on him. Then all of a sudden, he has to weigh the cost of embarrassment and probably paying fines or legal action against some of his behavior. I think this is a way to just end it,” McFall said.