Disagreement over classifying expansion fees as revenue is stalling WNBA-player union talks, impacting player compensation and future league earnings projections.
A sharp disagreement over how to classify expansion fees has emerged as one of the most contentious issues in ongoing collective bargaining talks between the WNBA and its players, further complicating negotiations as the sides approach a critical deadline.
Sources familiar with the discussions told ESPN that the WNBA and the Women's National Basketball Players Association remain divided on whether expansion fees should be counted as revenue when projecting future earnings and determining player compensation. The disagreement has become a central fault line in talks that already include disputes over revenue sharing models, salary caps, and how league expenses should be calculated.
The issue comes at a pivotal moment for the league, which is entering its most aggressive expansion phase in history. Portland and Toronto are scheduled to join the WNBA in 2026, while Cleveland, Detroit and Philadelphia are set to debut between 2028 and 2030. Each of the latter franchises paid expansion fees of $250 million, a figure that reflects the league’s rising valuations and growing commercial profile.
How those expansion fees should be treated financially, however, is now a major point of contention.
From the league’s perspective, expansion fees are not considered true revenue. League officials argue that while new teams pay a substantial upfront fee, the transaction results in no long-term net gain. New franchises receive a fractional share of future league revenue, while existing teams receive a portion of the expansion fee but lose a corresponding share of future revenue streams.
Under that framework, the league believes that counting expansion fees as revenue would distort financial projections and create unrealistic expectations about sustainable income. League officials have told ESPN that expansion fees are essentially a redistribution of future earnings rather than a net increase to the league’s revenue base.
The players’ union strongly disagrees with that assessment.
The WNBPA views expansion fees as real money that directly benefits owners and believes those funds should be included when calculating revenue used to determine player compensation.
A source close to the negotiations told ESPN that the league’s claim that a players’ proposal would lead to massive losses is “absolutely false,” pointing to the exclusion of expansion fees as a key flaw in the league’s financial projections.
That disagreement has taken on greater significance as the league has warned that a recent union proposal — which includes players receiving roughly 30% of gross revenue — could result in approximately $700 million in losses over the life of the next collective bargaining agreement.
The union disputes that figure, arguing that the league’s projections rely on selective accounting and fail to fully reflect the financial impact of expansion. From the players’ perspective, expansion fees contribute directly to owners’ bottom lines and should therefore be part of the revenue pool shared with the workforce that generates the league’s growth.
At the heart of the dispute is a broader philosophical divide over whether player compensation should be tied to gross or net revenue. Players argue that they should not be “paid last” after expenses they do not control, while league officials counter that rising costs make a net-revenue model necessary to ensure long-term financial stability.
With both sides operating under fundamentally different financial assumptions, sources say the expansion-fee debate has become a major obstacle to reaching a deal as negotiations continue ahead of the next deadline.