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Thursday, April 17
 
Owed to Donald Sterling

By Darren Rovell
ESPN.com

LOS ANGELES -- It's hard not to laugh at the Clippers. Another losing season. Another postseason missed. Another front row seat at the NBA Draft Lottery.

But you'd be hard-pressed to find Donald T. Sterling, one of the most reviled owners in sports, complaining. The pain of losing three out of every four games and more than 1,200 in total since buying the team for $13.5 million in 1981, has to be soothed by his penchant for putting winning numbers on the books.

Elgin Baylor
GM Elgin Baylor (right) wasn't able to lead the Clippers to the playoffs again this season, but owner Donald Sterling is headed to the bank.
Thanks in part to a league-low $42.7 million payroll, a strong market and plenty of help from the 28 other teams, the Clippers likely will be among the league's most profitable teams once again this season.

The team finished a franchise-best 14th in the league in attendance, drawing more than 700,000 fans for the second-consecutive season. At an average of $40 per ticket, that alone accounts for more than $28 million in gross revenue. Like all teams, the Clippers will receive more than $26 million from the league's national television deals with ABC, ESPN and Turner, and what likely will amount to at least another $15 million in luxury tax and escrow tax rebates for staying far below the NBA's estimated team payroll threshold of $52 million. Sterling also will receive checks from local media partners, including two television networks, two radio networks and local sponsorship deals.

"We don't set out to make money," Clippers executive vice president Andy Roeser said. "When it comes to winning versus profits, I don't think a well managed team should have to choose, they should be able to do both. And that's what we want to do."

Sterling, who shies from the media spotlight, refused to comment for this story.

Against the advice of most, including NBA commissioner David Stern, Sterling didn't move his team to Anaheim when the L.A. Sports Arena became outdated. Instead, he waited to become a co-tenant with the Lakers and Kings when the Staples Center opened in 1999, a move that has paid dividends over the past four seasons as the Clippers have averaged nearly 16,000 fans. Compare that to an average crowd of 12,991 fans during the 1992-93 season, the team's high-water mark in the Sports Arena, or the 5,800 fans who turned out for home games when the Clippers played in San Diego during Sterling's first four seasons as owner.

As a real estate mogul who owns some of the priciest property in Beverly Hills, Sterling has an estimated net worth of $500 million. Given his financial backing, his recent yearly gains seem negligible in his bank account, but condemnable in the eyes of the fans. That's because Sterling's motive operandi has been to stockpile first-round draft choices who are tied the team for three to five years on salaries determined by the league pay scale. Prominent free agents who have left the Clippers in years past, with little resistance from Sterling, include Danny Manning, Ron Harper, Dominique Wilkins, Brent Barry and Derek Anderson.

Michael Olowokandi, Elton Brand, Lamar Odom and Andre Miller are the prominent free agents on the current squad, which never met expectations and slumped to a 27-55 record after a 39-43 finish last season. Clippers players, including Odom and Corey Maggette, admitted halfway through the season that selfish play, fueled largely because the team's number of free agents looking to pad their stats, had torpedoed the team.

"All of us can't be All-Stars. Eventually some of us are going to leave," the recently traded-away Clipper Darius Miles told ESPN.com in October. "I didn't think I would be the first to go, but you can't pay six people the max contract."

Said Odom, in an interview with ESPN.com in January: "I know I'm going to be all right. I know somebody is going to bring me on their team and take care of me. Can I say that for somebody else next to me in this locker room? No, but I'm not worried about where I'm going to be next year."

Donald Sterling
Donald Sterling sets the bar high in deciding how he will spend on free agents like Elton Brand.
Sterling, one of the few owners in professional sports who owns 100 percent of a team, has drawn the ire of fans and criticism by the media for failing to make a splash in the free-agent market despite possessing the financial wherewithal to do so. Only two Clippers Olowokandi and Brand -- made more than the NBA average of $4.5 million this season. Ten NBA players made more this season than the value of the highest contract Sterling has ever awarded a player -- Piatkowski's five-year, $15 million deal -- and Lakers center Shaquille O'Neal's $23.6 million salary this season is roughly half the Clippers' entire payroll.

In Sterling's defense, none of the players he has passed on in recent seasons have gone on to become franchise players for other teams. Rival team executives, however, are waiting for the chance this offseason to sign at least two Clippers who will become free agents -- Brand and Odom.

"I'm satisfied and I think our track record is, 'Superstar prices for superstar players. And regular prices for regular players,' " Roeser said. "In the past some of our players have been confused about what they were. We've never really been blessed with a superstar. Today, I think that's different."

In the open market, Roeser said other teams might have been confused about how much Clippers free agents were worth.

"Would we trade profits for winning it all? Absolutely," Roeser said. "Would we trade a semi-competitive team for losing 20 million dollars a year? No. But unfortunately, that's what happens all too often in sports today. At some point in a negotiation process, a player can go from being an asset to a liability and in a case like that, you're probably better off or better served to either trade the player or simply let that player go."

NBA superagent Bill Duffy, who represents Olowokandi as well as fellow Clipper forward Marko Jaric, is used to dealing with the point when the Clippers perceive the price to be a liability. Last summer, Olowokandi was hoping to sign an extension worth $80 million, instead he accepted a one-year deal worth $6.1 million because the Clippers only offered $50 million over seven years.

"The Clippers have been very conservative and you can't argue with that from a business model standpoint," Duffy said, "but because they've never taken the risks, they haven't seen the rewards. They've always had one eye on cultivating the talent and the other on the bottom line and history has shown that they are more focused on the bottom line."

No so sterling
In 22 seasons under Donald Sterling, the Clippers have compiled a 579-1,203 record, a .324 winning percentage.
Season W L
1981-1982 17 65
1982-83 25 57
1983-84 30 52
1984-85 31 51
1985-86 32 50
1986-87 12 70
1987-88 17 65
1988-89 21 61
1989-90 30 51
1990-91 31 51
1991-92 45 37
1992-93 41 41
1993-94 27 55
1994-95 17 65
1995-96 29 53
1996-97 36 46
1997-98 17 65
1999 9 41
1999-00 15 67
2000-01 31 51
2001-02 39 53
2002-03 27 55

Nothing wrong with that, said one of the NBA's most free-spending owners.

"This is probably going to sound strange, but Donald Sterling probably has more focus on winning it all than any owner," Dallas Mavericks owner Mark Cuban said. "The reality is in order to win a championship, you need a No. 1 pick that is a ... player that just dominates -- Shaq, Tim Duncan, Larry Bird, Magic Johnson. And either you sign him as a free agent or you have the No. 1 pick and you get them."

The compliment is surprising especially since Cuban will get the third largest bill for luxury taxes at the end of the season and some of his money will be directly distributed to Sterling.

The largest financial rewards will be realized by the low payroll teams like the Clippers, Washington Wizards and Chicago Bulls, who are also in the top half of league attendance. By being under the projected $50 million threshold for the luxury tax, these teams will collect 100 percent of luxury tax and escrow money on top of the money they already make from ticket and concession revenues. In contrast, the Portland Trail Blazers, will pay at least $50 million in luxury tax and will not collect any rebates.

Dan Rosenbaum, an economics professor at the University of North Carolina-Greensboro who specializes in luxury tax research, said the teams that fall under the threshold likely will receive at least $15 million in rebates and could receive as much as $21 million each.

NBA commissioner David Stern told ESPN.com last week that he wasn't uncomfortable with the perception that the luxury tax penalizes teams that spend more on payroll and rewards those that spend less. "They'd rather be winning because they would take in more money from the extra attendance than they would spend on the tax," Stern said.

While that's likely accurate for the Denver Nuggets and Cleveland Cavaliers, two teams that are well below the luxury tax threshold and finished in the bottom five of league attendance, that's not necessarily the case with the Clippers. Fans have filled the Staples Center to 90 percent capacity this season. There is a huge overflow of NBA fans in the nation's second largest market that can't get into the arena when the Lakers play -- not to mention at an average of $30 less per ticket.

Despite their dismal record, the Clippers were still a very exciting team to watch and their youth -- the players' average age is 25.6 years old -- has contributed to their popularity among youthful fans. Last year, the Clippers ranked among the league's top 10 teams in merchandise sales, though the team did not match that feat this year.

There will be plenty of decisions for the Clippers to make in the offseason as there are eight free agents who could be re-signed to long-term deals, including Brand, Odom, Miller and Maggette, if Sterling decides to match offers from other teams. The team's only unrestricted free agent, Olowokandi, is believed to be as good as gone.

"I think we have better players, better assets, and we're in better position to be able to make the fans happy and re-sign the players that are going to be the core for our future," Roeser said. "We want to move forward in a way that can give them a great experience at an affordable price and win."

Only time will tell if Sterling believes that paying a price to win is worth it when it's possible that maintaining status quo at least for now is more profitable. If that's the case, it also remains to be seen how long fans will put up with the profit-first, compete-second operation.

Darren Rovell, who covers sports business for ESPN.com, can be reached at darren.rovell@espn3.com.







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