The NBA proposed an increase in franchise debt limits, from $325 million to $475 million. The measure, which represents the 1st increase since 2018, was presented to the League’s Board of Governors, which must vote on the issue. League executives believe board members will approve the proposal without objection, according to information released by the website.
The new limit could directly impact the teams’ biggest salary sheets. It currently includes $275 million in franchise-secured debt and $50 million in other debt. If the measure is approved, teams will be able to access up to an additional US$150 million. Even after approval, the NBA will still need to complete all steps before implementing the new limit.
In recent years, the average value of NBA franchises has jumped from US$1.65 billion to US$4.6 billion, according to data from the Sporty. This appreciation reflects the new, more lucrative broadcasting contracts, such as the agreement signed in July with ESPN, NBC and Amazon, valued at US$77 billion and effective from the 2025/2026 season. The contract is expected to increase the average annual value received by the league by more than 150% compared to the previous contract.
The NBA currently manages a total debt of $6 billion, split between $4.3 billion under Hardwood Funding and $1.7 billion under Basketball Funding. The League’s National TV contracts guarantee an increase in the credit limit.
The NBA follows similar market trends as other sports leagues. In 2020, the NFL raised its debt limit from $350 million to $500 million, later adjusting it to $700 million. However, the NBA maintains a prohibition on using additional debt to acquire franchises.
