The NBA is planning to raise its credit line up to $1.2 billion, which would aid the league in handling its expenses through what’s expected to be an extended shutdown because of the coronavirus pandemic, sources tell ESPN.
The NBA credit line has been $650 million, so this would represent an increase of $550 million.
The NBA discussed the plan on a call with the league’s Board of Governors on Tuesday, a meeting that included ex-Surgeon General Vivek Murthy delivering a grim forecast for the pandemic’s potential impact on the United States and further convinced owners that there could be no resumption before June — if that was even soon enough, sources said.
Murthy told the Board of Governors that he was more optimistic in recent days once state officials took the lead in trying to mitigate the transmission of the virus, sources said. Murthy’s words were consistent with other credible health officials, warning those on the call that the worst was yet to come.
“Basically, [Dr. Murthy] said: The only good news is that people are starting to stay home,” one high-ranking league official told ESPN. “No one left that call thinking we could be playing anytime soon.”
The NBA has been considering numerous contingency plans, which include playing only several more regular season games, shortened early playoff series’ from best-of-seven to best-of-five, but everything remains fluid, sources said.
Teams are hoping that the league will soon give direction on possible drop-dead dates for starting the season, but the NBA doesn’t seem to be rushing into locking themselves into those scenarios. NBA owners are awaiting the league’s financial projections on lost revenues, which are expected to be shared with them soon, sources said.
J.B. Lockhart, the NBA’s chief financial officer, has been leading the effort to deliver owners what all expect to be challenging financial projections on a short-term future that is thick with uncertainty and volatility.
The NBA will likely provide projections on three primary scenarios: The financial costs of a shutting down the season, re-starting with no fans in arena or playing playoff games with fans. Those losses will be reflected in next year’s salary cap, and the players’ share of Basketball Related Income.