Wolfpack's fate could be decided Friday at Super League board meeting
Rugby club stood down in July, saying it couldn't afford to play out rest of season
A meeting of the Super League board Friday could decide the future of the Toronto Wolfpack.
Then again it could just trigger more questions about the transatlantic rugby league team's new business plan and how deep the pockets of its potential new owner are.
The Wolfpack's fate will eventually be decided by the 11 other Super League clubs, executive chairman Robert Elstone and the Rugby Football League. All have one vote.
Wolfpack chairman and CEO Bob Hunter says the club doesn't know whether there will be a vote Friday.
"We are certainly a key part of the agenda, to put it mildly," said Hunter.
Super League and RFL have written a report on Toronto's submissions, although the Wolfpack haven't seen it so don't know whether it is positive or negative.
"They may have more questions, they may want more assurances etc etc. We're really not sure what's going to happen." said Hunter.
The Wolfpack, who will not be represented at the virtual meeting, are hoping at the least to keep making their case for reinstatement.
Financial struggles
Toronto stood down July 20, saying it could not afford to play out the remainder of the season. The global pandemic forced the cancellation of scheduled home games in Canada, cutting off an important source of revenue.
The well soon ran dry with majority owner David Argyle unable to finance the team — or pay the players. Their last cheques came June 10.
The Wolfpack have launched an all-out lobbying effort, with fans and players taking to social and other media to talk up the benefits of a toehold in North America.
Carlo LiVolsi, the Toronto businessman hoping to buy the franchise with Argyle stepping away, has been lobbying club owners. The Wolfpack have made it clear that LiVolsi's bid is based on playing in the top tier — he has no interest if the club is forced to fight its way out of the lower divisions again.
LiVolsi also wants an equal share of the pie.
The Wolfpack's original participation agreement specified it would not get a share of central distribution funding.
At the lower leagues, how much money a team gets from central funding is primarily dependent on where it finishes in the table. Unlike the Wolfpack, the fledgling Ottawa Aces will get their share when they begin play next year in League 1.
For Super League, the central distribution money is drawn primarily from TV revenue with a portion from sponsorships.
Club forgoes TV money
After winning promotion to Super League last October, Toronto agreed to forgo the central distribution funding for another year — with the proviso that the issue would be re-examined ahead of the 2021 campaign.
In a normal year, a Super League club would receive 2.3 some million pounds ($3.92 million), according to Hunter. Most of that money comes from the Sky TV broadcast deal.
"We have no criticism of the league, because David Argyle accepted no central distribution," said Hunter.
Argyle believed he could take advantage of the TV rights in North America and elsewhere outside of Sky's reach.
"Unfortunately we've never been able to monetize that and it's never proven to come even close to what that central distribution number is. So it was a very bad decision at the time," Hunter said. "And one that has haunted us since Day 1 when they entered into [the third-tier] League 1."
"And you cannot survive — any club cannot survive — without that central distribution [funding]," he added. "And we still have to pay all the travel costs [of visiting teams]. So there's a half-million dollars there."
Moving the goal posts
The central distribution funding essentially covers the Super League salary cap, which was 2.1 million pounds ($3.58 million) in 2020. Clubs are allowed two marquee players whose salary cap hit is restricted to 150,000 pounds ($255,675) each no matter how much they are getting paid.
Some owners see the benefits of North American expansion. Others are reluctant to reduce their share of the revenue.
Wolfpack founder Eric Perez, who is now heading up the Ottawa franchise, said the decision not to grant central distribution funding came late in the game.
"They kind of moved the goalposts right at the end. And they told us 'Well we'll let you in but no central distribution for at least three years. And then we re-evaluate,"' Perez said in an interview before Toronto stood down.
"That was the only way we were going to get in. So that's why we took that deal."
The change in heart forced Perez to find new investors, with Argyle coming on board.
The original reason for the reluctance in offering Toronto the central distribution funding?
Perez said rugby league authorities cited "the reputational damage that you would do if we did this and it didn't go well. That you couldn't compete or you forfeited in the middle of the season or whatever."
