Profitable franchises could find their values enhanced because under the proposed legislation, they would be able to write off far more in taxes than they can today when they sell their teams.
The revised legislation would let owners deduct the entire value of their sports franchises - including broadcasting contracts, players' contracts and concessions - from their income tax over a 15-year period.
Under current law, only players’ contracts can be written off, but only up to half a franchise’s value and only for the duration of those contracts, generally just a few years.
“At the end of the day, there is no doubt it raises franchise values,” said Robert Willens, managing director of the investment bank Lehman Brothers.
Willens said the provision could add five per cent to the value of many sports teams. Aaron Barman, who heads the sports finance group of Raymond James & Associates, said profitable National Football League teams could see their value rise by five to six per cent.
Major League Baseball has been among the strongest advocates lobbying for the change, congressional aides said.
