Once we celebrate the revival of the Sonics legacy to Seattle and Las Vegas now having an NBA team, it’s time to look at the math. For a while fans have been questioning the insanely high expansion fees ranging in the $7 to $10 billion range. Especially when that was the price tag of the biggest franchises, the Lakers and the Celtics in their recent sales. As it turns out, fans weren’t the only ones thinking those questions.

The board of governors that voted in favor of the expansion also questioned the necessity of the entire project. According to Marc Stein, that $7 billion price is a safety net Adam Silver needs to see this through.

Speaking on SiriusXM NBA Radio, Stein revealed that the NBA Commissioner’s recent push for expansion is tied to a strictly defined financial threshold. “I think if it’s not $7 to $10 billion, then there’s not going to be expansion,” Stein noted.

He emphasized that the league’s 30 current owners are viewing the process through a lens of equity distribution. A profit-sharing model that squarely leaves out the main characters in the heart of the expansion – the NBA players.

“Adam Silver acknowledged yesterday that there are some owners who have flat-out asked and raised the point, ‘Do we need expansion? Do we need to go from 30 to 32 teams?'” Stein said. “The reality is the reason they’re going to do it is because if they can get $7 to $10 billion, remember expansion fees are not shared. Not one cent is shared with the players.”

That’s often a fact that is overlooked by fans. But not by a board of governors for whom the economic implications of the NBA expansion is far more calculated.

Adam Silver has won half the NBA expansion battle

The NBA expansion is something fans have been looking forward too. Shaquille O’Neal and LeBron James had expressed intent to own the Las Vegas franchise. Most of all, the basketball world was eager for the return of the SuperSonics.

The narrative, however, shifted when it was confirmed that the expansion fees would be to the tune of $7 billion. Suddenly, Shaq stopped talking about it on his many Vegas excursions. Bron outright rejected the idea, mostly because he’s still an active player who can’t bid and also because Fenway Sports Group has withdrawn from the sweepstakes.

The withdrawal of Fenway, who own multiple franchises, also highlights what a steep ask $7 billion is for a brand new franchise. But Stein illustrated that this price incentivizes the board of governors and ensures Adam Silver’s plans go ahead.

“Let’s just imagine both teams come in at $8 billion. Just for kicks, that $16 billion is divided by 30 and that is a hefty slice of cash,” the veteran analyst summarized.

As the expansion fees are not the same as basketball-related income like from the $72 billion media rights deal, the potential windfall goes to the governors and league administration. The existing 30 team owners might get a worthy compensation for talent dilution when they’re inevitably forced to part with players that go to Vegas and Seattle. Without this massive payout upfront to offset the dilution of revenue-sharing, the board’s appetite for a 32-team league could quickly evaporate.

The league has officially hired PJT Partners to vet potential ownership groups. Securing the vote of the board was only half the battle won. Unless Adam Silver gets bids that are worth more than the Lakers, Celtics, and Knicks, the franchises in Seattle and Las Vegas will remain a figment of imagination.