MLS Commissioner Don Garber says the league is not performing as hoped financially and its franchises are combining to lose more than $100 million annually.
Garber attributed losses to player acquisitions, stadiums and spending on league infrastructure. The update about the league’s finances came with the MLS and its players’ union beginning negotiations on a new collective bargaining agreement.
"I can say without doubt that our owners did not expect that by this time we’d still be needing to invest the level of money that we have been investing, and that’s just the reality of where our business is today," Garber said during a telephone interview with The Associated Press.
Garber covered a range of topics during a "State of the League" event Tuesday and later expanded when talking with the AP. The labour contract with players expires at the end of Jan. 31 and the sides needed assistance from the Federal Mediation and Conciliation Service in 2010, when they reached an agreement five days before the season opener.
Garber was optimistic a deal will be reached before would be reached before the 2015 season is scheduled to start in early March.
"You go into these discussions with an open mind and a desire to reach an agreement, and be as open as can, and be as transparent as can be," Garber said.
Garber also told the AP he has communicated a number of times with U.S. national team coach Jurgen Klinsmann since the pair had a public spat in October. Garber criticized Klinsmann for not taking Landon Donovan to the World Cup and for saying Clint Dempsey and Michael Bradley damaged their careers by returning to MLS from European clubs.
"This debate, which is open and transparent, is positive for the sport," Garber said. "People care. We care about growing MLS and contributing to the growth of the U.S. and Canadian national teams. He cares about the U.S. being a more powerful competitive force in international competition. And as I think (U.S. Soccer Federation president) Sunil Gulati said, we're not going to agree on everything and that's OK because we have a very strong foundation to our relationship both personally with Jurgen and Sunil and me and more importantly corporately between the league and the federations."
Other issues Garber spoke on:
EXPANSION: The league expands to 20 teams next season with the addition of Orlando City and New York City FC and the folding of Chivas USA. Los Angeles FC and Atlanta join in 2017 and a franchise has been promised to David Beckham's group in Miami.
Beckham's Miami franchise remains uncertain.
"If they don't have the right stadium we won't go there," Garber said. "Until they get it finalized we can't make the commitment to go to Miami."
Garber has said MLS will expand to 24 teams before the end of the decade, and his expansion committee is to speak with owners this weekend regarding overtures from Minneapolis, Sacramento and Las Vegas. A decision could be made within the first six months of 2015 on which city will be the next expansion market.
PLAYOFF STRUCTURE: Garber hinted that expanding the playoffs by two teams to 12 -- six from each conference -- could be announced by this weekend. League staff has recommended the move to owners. Garber said the away-goal rule as a tiebreaker in two-leg playoffs will remain.
STADIUMS: Garber remains hopeful D.C. United, New England and New York City FC will find soccer stadium solutions. NYCFC will play at Yankee Stadium as a temporary home, while D.C. United's stadium proposal has passed a first vote by the D.C. Council.
"I hope that puts us in position for the Northeast to be its own rivalry that could replicate the Cascadia rivalry that is so important in the Northwest," Garber said.
REPLACING STARS: The league is losing stars Thierry Henry and Landon Donovan at the end of the season. Henry announced he's leaving the New York Red Bulls while Donovan will retire after Sunday's MLS Cup final against New England.
The league planned to honour Donovan this weekend but put that off until the MLS SuperDraft in Philadelphia on Jan. 15.
Garber says the loss of two of the biggest names in the league should be lessened by the arrivals of Kaka, David Villa and Frank Lampard next season.
"We're not relying on one or two players. It no longer is 'That's the league David Beckham is in.' It's now the league that Obafemi Martins is in and the league Bradley Wright-Phillips is in and the league that DeAndre Yedlin is in," Garber said. "There is a terrific dynamic that exists that has more and more players stepping up and taking the mantle of being an important star in our league."