USSF D2 Update; New Standards Set for League, Current and Future Owners
The much-anticipated USSF D2 meeting on Monday took place in New York without much fanfare or negotiations according to sources involved with teams that participated. The meeting was in general amicable and US Soccer did allow discourse.
Those attending the meeting from the federation were Sunil Gulati, Dan Flynn, and Brian Remedi. Team owners attending were: Austin Aztex owner Phil Rawlins, Carolina RailHawks owners Bob Young and Selby Wellman and his son Brian, Crystal Palace Baltimore’s Pete Med, FC Edmonton owner Tom Fath, Miami FC/Traffic US president Aaron Davidson, Montreal Impact owner Joey Saputo, NSC Stars GM Kris Bjerkness, Rochester Rhinos owner Rob Clark, FC Tampa Bay majority owner Andrew Nestor and Vancouver Whitecaps president Greg Kerfoot and USL owner Rob Hoskins. Those not present were Jeff Cooper of AC St. Louis, representatives from Puerto Rico who were said to be frustrated and felt that they most likely will not meet the new USSF standards, and the Portland Timbers who will be moving on to MLS next season. Vancouver and Montreal have been actively involved with these discussions because the Whitecaps and the Impact would like to discuss the possibility of keeping a team in the D2 league for developmental purposes. Atlanta Silverbacks’ Boris Jerkunica was not in attendance either which may be telling with his involvement with the league in the near future.
IMS has been told the standards that US Soccer presented to the team owners on Monday and that were passed by the Federation board on Tuesday will be released in the next several days. While some of the new standards may be negotiable, the financial set of standards will not. Provisions are laid out in the documents that teams could ask for a wavier on certain aspects of the rules. However, US Soccer made it very clear to those in the room that the financial qualifications will be strictly adhered to. As IMS posted on Monday, some of those standards for teams are the ability to post a $750 thousand bond 90 days in advance of the season. Last year’s bond by USSF was $350 thousand. When the United Soccer Leagues ran the league the amount was $100 thousand.
Another qualification is the majority owner of the team must have a net worth of $20 million. The federation also told owners they would each be asked to make a personal disclosure of that money and would need to have a percentage of it liquid enough for capital calls as necessary. As one source told IMS, “They are not going to mess around with this. They (US Soccer) are going to be very diligent.”
It’s believed that while not everyone was thrilled with the new standards, most in the room were able to make the standard and felt in the long run it was what was best for Division 2. However, some felt there should be more guidance from the federation “looking at the big picture of how the league and its teams can remain viable in a struggling soccer market in the US.”
USSF announced they have set September 15 for the deadline for bids to be placed for sanctioning of D2 for 2011. They also announced to the group they have no intention of running the league again next year. After a league is sanctioned, the teams within the league will be carefully scrutinized to make sure they comply with the new USSF litmus tests. According to one source they hoped that US Soccer could have the whole procedure taken care of by mid to late November so teams could plan appropriately for next season. Last year, teams were thrown into limbo when it was not known who would sanction the league and teams were not able to secure dates and venues until mid to late January. This also prohibited them from selling season tickets around the holidays and some felt the chaos from the last offseason hurt their overall attendance numbers this season.
Teams in question
It’s not known if Crystal Palace, who have had deep financial troubles this season, will apply for next season. As noted, Pete Med did attend the meeting.
With Jeff Cooper, now primary owner of AC St. Louis, not attending the meeting, it could be a sign that he will not apply for next year. But Cooper has had a falling out with both US Soccer and the NASL group and it’s possible he could apply again next year but did not want to be in attendance at the meeting.
It’s also not known what Puerto Rico will do. They do not have any one owner worth the $20 million and it’s not know if they can even come up with the bond money. It’s possible they could find another investor or that US Soccer allows the variance if they come up with the performance bond and prove enough parties have enough cash liquidity to satisfy the federation.
The NSC Stars will announce soon they are looking for investors in the team to partner with them for next season. The concept is not new as the organization was hoping to do this last spring. With only 90 days to prepare for the season they did not have time to properly investigate the legality of investors being involved with a non-profit. IMS was told by GM Kris Bjerkness several weeks ago that this has been explored and they are now open to talking to investors. It is clear that the NSC does not meet the standards required by the USSF and if an investor or a group of investors is not found, the team will not be able to apply to play in the league next season.
Another new federation rule is 75% of teams participating in the league need to be from the US. If Edmonton qualifies for next season it would mean that 2 teams, Montreal and Edmonton, both from Canada, will be involved with the league next season. That means 6 teams need to be US-based teams to meet the criteria.
Teams from the US that should be able to pass the financial standards are: (5 teams) Austin Aztex, Carolina RailHawks, Miami FC, Rochester Rhinos and FC Tampa Bay. The Canadian team are: (2 teams) FC Edmonton and the Montreal Impact, bringing the total to 7. Eight is the minimum number of teams to form a league according to FIFA, but exceptions are allowed if there are plans to bring more teams into the league the following year.
There has been no definitive word from the USL concerning the Orlando group who have recently had financial trouble or the FC New York group. Neither were at the meetings on Monday.