In a continuation of criticism of the league office over the better part of two years, New York Knicks owner James Dolan has called for a resolution to be voted on at this month's Board of Governors meetings that asks for clearer accounting of the league's finances, according to a letter received by the league office and the rest of the Board of Governors.
Dolan, who said ahead of the September meeting that he wouldn't be voting on the 2024-25 budget, or the election of a new chair of the Board of Governors, laid out in the letter, which was obtained by ESPN, why he believes the NBA needs to add a resolution to its agenda for this month's meeting as part of an ongoing attempt to seek out "increased financial transparency and operating efficiency."
The proposed resolution would begin with the 2025-26 NBA fiscal year, and would ask the league to both "adopt a zero-based method of budgeting operating costs, headcount, and capital expenditures for all League and Affiliate League operations" and "adopt a process to present and distribute the League's annual proposed budgets inclusive of all underlying account detail summarized by department and type of expense, headcount, and fully allocated costs against each League revenue stream."
In the letter, which was co-signed by both Dolan and the team's alternate governor, Madison Square Garden chief operating officer Jamaal Lesane, the Knicks detail how the league's operating budget rose nearly 8% from the year before, and pointed out specific increases in a variety of areas, as well as an increase in "League office headcount" by over 800 people.
"Despite the League's swelling costs and headcount, the budget materials provided by the League during its annual September budget review are limited in scope," the letter said. "Accordingly, to improve the League's financial transparency and operating efficiency, the Knicks propose that the League adopts a zero-based method of budgeting operating costs, capital expenditures, and headcount for all League operations and initiatives (including Affiliate Leagues, such as the Basketball Africa League, WNBA, and G League).
The letter then went on to ask for further underlying details -- "summarized by department and type of expense-including headcount, capital expenditures, and fully-loaded budgeted costs with respect to the League and each of its subsidiaries and Affiliate Leagues" -- and for all costs and head counts related to both the league's upcoming new national media deals, which kick in next season, and "any contemplated NBA Europe league operations."
The Knicks also asked for the 2025-26 budget to be presented in July at the league's annual Las Vegas BOG meeting, so that it could be ratified in September when the owners convene again before the start of the season.
Dolan and the Knicks have repeatedly questioned the league office on a variety of topics dating back multiple years. The team sued the Toronto Raptors in August 2023 over the alleged theft of thousands of files, with an arbitration hearing scheduled for the week of July 21 to finally resolve it. That same summer, Dolan resigned from both the advisory/finance and media committees, and wrote in a memo obtained by ESPN that "given all that has occurred lately, I have come to the conclusion that the NBA neither needs nor wants my opinion."
Last year, he sent another letter criticizing the league for its new television deal, which he said would render regional sports networks as "unviable" moving forward.
"The NBA has made the move to an NFL model -- deemphasizing and depowering the local market," Dolan wrote in the letter, which was obtained by ESPN. "Soon, your only revenue concern will be the sale of tickets and what color next year's jersey will be. Don't worry, because due to revenue pooling, you are guaranteed to be neither a success nor a failure.
"Of course, to get there, the league must take down the successful franchises and redistribute to the less successful. This new media deal goes a long way to accomplishing that goal."
On Monday, Sphere Entertainment said in an earnings release that it could look at entering MSG Networks, which broadcasts both Knicks and New York Rangers games, into bankruptcy protection if it's unable to work out a deal to refinance its debt, shortly after the company came to an agreement with Altice to get the networks back onto one of the biggest cable providers in the country, and one that serves much of the tri-state area.