Federal Loan Saved a Soccer Season Nearly Lost to the Pandemic

As the coronavirus pandemic spread early this year, shutting down large portions of the United States economy, the federal government handed out more than $520 billion in forgivable loans to more than five million small businesses. Called the Paycheck Protection Program, the money was to be used to replace the incomes of employees suddenly unable to work as cities and states entered lockdowns to reduce infection rates.

The recipients ranged from clothing stores to car dealerships to coffee shops.

They also included a women’s professional soccer league.

The National Women’s Soccer League confirmed Thursday afternoon that it had received an unspecified amount from the program, and had used the money as a bridge to pay players for two months. It expects the loan to be forgiven.

Other sports entities were publicly involved in the rocky beginnings of the Paycheck Protection Program. The Los Angeles Lakers — the eighth-richest sports franchise in the world, by one measurement — secured a $4.6 million loan before quickly returning it amid news reports that smaller companies in desperate need of the funds were finding it hard to access the program. The United States Soccer Federation returned the money it had received, too, once it became clear that the layoffs and furloughs it had implemented would disqualify it for loan forgiveness.

But the N.W.S.L. desperately needed the money as it sought to salvage its eighth season — not to mention several hundred jobs. One hundred percent of the funds were used to pay player salaries for more than two months, the league said.

“Our sole intent in applying for the P.P.P. loan was to continue player compensation,” said Lisa Baird, the league’s first-year commissioner. “With ours, the calculus was pretty simple. Either you’re going to pay your players or you’re going to furlough them. What could we do?”

The decision to apply for the loan came amid Baird’s tumultuous start as commissioner. She officially took over the position on March 10. Two days later, she shut down the league in response to the pandemic. She called this period “the fog.” The league, like every other business, was scrambling.

“Nobody knew what was going on,” she said.

Baird said the N.W.S.L., as a small operation with a brief history and only a few hundred employees, was almost entirely reliant on stadium ticket sales and local sponsorships for revenue. Those disappeared when this spring’s games were called off. When Baird took the job, the league had only two national sponsors.

After consulting with league officials and owners, Baird said she gathered a thousand backup documents — “literally a thousand” — and sat at her computer for six hours to personally submit the application.

“Over 85 percent of our total monthly expenses is player compensation,” she said of the league’s finances. “I didn’t even want to stare at the alternatives. For me, I had to have this happen.”

In important ways, the N.W.S.L. fulfilled the strict qualifications set out by the federal government relief program: A relatively young business, it had fewer than 500 employees; the pandemic had effectively barred its employees from working; and its workers’ incomes, and perhaps careers, could have disappeared altogether if the league had been unable to play matches.

Baird, who has only 16 people on staff to go along with more than 200 players, described the P.P.P. funding as the bridge that allowed them to escape the early danger of the pandemic. (The league’s top players and biggest earners — more than two dozen members of the women’s national team — are paid by U.S. Soccer.)

The loan gave the league the wiggle room to plan an improvised summertime tournament that began last week in Utah and to secure commitments from three new national sponsors. Those new deals, Baird said, will help ensure that players will be paid and get all of their health benefits for the rest of the year.

The Lakers episode, though, showed how touchy people could be about learning that sports teams and leagues — not to mention prominent brands like Shake Shack and the Fortune 500 car retailer AutoNation — had applied for and received relief funds. In England, soccer teams like Tottenham and Newcastle United were criticized by their own fans for seeking large government loans amid the coronavirus crisis.

Baird said that she and the league’s owners, who include wealthy businessmen, a prominent French soccer club and even the governor of New Jersey, had weighed the pros and cons and discussed the possibility of receiving negative attention for applying for the loan. But they quickly realized that it was too important for them to be able to pay the players, she said. In the N.W.S.L., rank-and-file players are employees of the league, not of the individual teams.

“That benefit outweighed anything that we could think of in terms of optics,” Baird said.

Baird said she expected the league’s P.P.P. loan would qualify for forgiveness because 100 percent of the money was used for payroll (the government requires that at least 60 percent of the funds be used for payroll for a loan to be forgiven) and because the N.W.S.L. did not lay off any employees, another condition.

“I pray for that in my nightly prayers,” said Baird, who said she and some other highly compensated league officials had taken pay cuts in a separate attempt at belt-tightening.

Having used the loan as a lifeboat, Baird on Thursday cautiously deemed the summer and the nascent tournament a success.

An entire team, the Orlando Pride, dropped out before play even began after six players and four staff members tested positive for the virus. But the first game — in which players made headlines for kneeling during the national anthem — drew the highest television rating in the league’s history.

“It gives us confidence that we can be a small business that can make it through this time,” Baird said. “That’s a key thing: We’re not a large business. We’re a small business.”