A threat to the Republic: Behind the ownership drama that may yet hurt Sacramento soccer club’s major league goal

Before last week, Republic FC was riding high on its way toward Sacramento’s bid for a Major League Soccer expansion team.

But when Sacramento submitted its MLS bid last Tuesday, the Republic name and crest were nowhere to be found. The fan base was confused, hurt, enraged. The Republic filed a press release of similar sentiment. It looked like the United Soccer League club they loved might not make the leap to the big leagues after all—that some crestless, to-be-announced squad would some day rise to MLS prominence in Sacramento. Or, worse, that this drama would spell the beginning of the end of MLS in Sacramento.

A long-overlooked rift between the team’s founder Warren Smith and future owner Kevin Nagle came to light, with the two unable to reach an agreement on how much Nagle should pay Smith to lift the Republic FC brand to the MLS.

It was another Sacramento sports drama arriving at an inopportune time, with the MLS having no shortage of suitors for two pro slots anticipated to be handed out this year.

The dust-up hit national soccer headlines, with folks questioning Sacramento’s readiness for the big league—despite the USL team’s squeaky-clean history and packed stadiums—until Mayor Darrell Steinberg hopped in the mix and brokered tentative terms for a deal over the weekend.

That cleared it all up, right? Republic FC would be the next team to join the MLS. Everybody wins?

Well, maybe. Let’s take a look at the full saga.

Entrepreneur and former River Cats owner Warren Smith is the founder and owner of the Republic FC. Since its 2014 debut, the team has had its sights set on joining the MLS as soon as the league granted Sacramento a chance. That day was fast approaching.

Ever since Kevin Nagle lost his shot to be known as the whale that kept the Kings in Sacramento to Vivek Ranadivé, the consensus has been that he would be the heavy lifter in the town’s future MLS expansion team. General consensus has also said that that team would be the Republic FC.

For that to take place, however, Nagle would have to buy the Republic brand from Smith around the time the MLS gave the greenlight. The two millionaires began negotiations this past year once the MLS started floating more air kisses in Sacramento’s direction.

But here’s the rub: Nagle and Smith have profoundly differing views on the worth of the Republic FC brand.

Multiple sources put Smith’s opening price at $50 million. Nagle and the other whales were surprised to see anything higher than seven figures.

The Smith and Nagle camps went at it for months, with MLS Commissioner Don Garber jumping in as a mediator at one point. Finally, the two parties seemed to reach a deal for undisclosed terms. But just before the MLS bid deadline, it fell apart.

Nagle submitted the Sacramento expansion bid last Tuesday with no mention or display of the Republic FC crest. Steinberg released a bid-related video with the same omission. No one noticed at first, but members of the press started to ask questions after prodding by the Republic FC’s Tower Bridge Battalion fan group. Where was the Indomitable City’s crest? Was everything OK?

The following morning, the Republic FC dropped a bombshell press release.

“We are just as surprised as our fans to hear that various news outlets are reporting that a bid was submitted to MLS for Sacramento which does not reference Sacramento Republic FC. If these reports are true, this is deeply troubling to us,” it read. “If the bid submitted yesterday by Mr. Nagle did not include Sacramento Republic FC, it was in violation of our agreements and without our authorization; and we will take this up with the appropriate parties immediately.”

But folks close to Nagle said Republic FC had asked to have their logo removed from the bid. Who was telling the truth?

Suddenly Sacramento’s do-no-wrong soccer universe was turned upside-down, feeling eerily like the bush league nonsense the city has come to expect from the Kings, who almost left town numerous times due to ownership drama.

Did Sacramento soccer just turn a gimme penalty kick scenario into an own-goal?

U.S. soccer media immediately smelled blood, with former U.S. men’s national soccer team defender and current commentator Alexi Lalas tweeting, “Is Sacramento killing the golden goose? Or was it really that golden?” Quoting a tweet by Steinberg saying he’d use his office to insist Nagle and Smith work it out, Lalas wrote, “Or what?”

Republic FC fans were furious.

“It seems like perhaps there is an assumption that any MLS team in Sacramento will be accepted by the fans here,” said R.J. Cooper, founder of the Tower Bridge Battalion. “What makes Republic special is how it’s been a grassroots effort. You can’t just swap the labels on that and make it go away.”

The thrust here is that soccer fandom is a bit different from other U.S. sports in the sense that a supporter will be there for his or her club no matter the tier it’s in. When a team is relegated to a lower league in the English Premier League, for example, fans do not simply pick a new favorite EPL squad. They stay true to their roots.

Responding to the blowback from Nagle’s Republic-less bid and his own Republic-less video, Steinberg held a February 1 press conference to tamp down fears over the “kerfuffle,” promising to meet with Nagle and Smith the following day. When pressed on the cause of the dispute, Steinberg verified what many suspected.

“Is it ever not about money?” he said.

That evening, Smith and Nagle released conciliatory statements before their meeting with the mayor. Sacramento’s soccer community held its collective breath for two days before word broke Saturday morning that the mayor had brokered a tentative deal.

But was it too little, too late for MLS execs?

While there are no details on the new terms, it’s important to address the burgeoning business that is American soccer.

Back when Republic FC joined USL, its expansion fee to the league was a paltry $250,000. In four short years that fee has ballooned 1,500 percent, with Nashville’s new club dropping $4 million to enter the league.

On the MLS level, teams are consistently in the black for the first time in the league’s history. According to Forbes, the average MLS team was worth $185 million in 2016, an 18 percent rise from the year before and a staggering 80 percent increase from 2013. That sort of growth has investors salivating, and many clubs are more than willing to drop the $200 million expansion fee proposed over the summer by MLS President Mark Abbott.

The MLS is looking to add four teams by 2021, with the first two expected to be announced this year. A dozen cities are vying for spots, but Sacramento has long been considered a frontrunner.

So what’s the price of a beloved Sacramento club’s logo among friends?

Despite raised eyebrows from the likes of Lalas, MLS executives spent the past week dismissing concerns over Sacramento’s bid.

In Saturday’s joint press release announcing the tentative deal, Nagle and the mayor’s quotes were at once effusive and assured. Smith was somewhat more measured.

“[W]e are hopeful that the principle terms we discussed today can result in a definitive agreement that will lead Sacramento Republic FC to Major League Soccer,” Smith’s statement read. “Thanks to our fans, supporters and indomitable city, Republic FC will be Sacramento’s MLS team.”

Accompanying the release is a photo of the three men smiling, each with a bottle of Sacramento brewery Rubicon’s Monkey Knife Fight IPA in hand.

It remains to be seen how that metaphor will play out.