I 

108TH CONGRESS 

1ST SESSION H. R. 2745

To amend the Internal Revenue Code of 1986 to require a sports franchise 

to provide for all of the games played by the franchise to be available 

for local television broadcasting in order to be subject to the presumption 

that 50 percent of the consideration in the sale or exchange of a sports 

franchise is allocable to player contracts. 

IN THE HOUSE OF REPRESENTATIVES 

JULY 15, 2003

Mr. KUCINICH (for himself, Mr. RANGEL, Ms. BORDALLO, and Mr. HINCHEY) 

introduced the following bill; which was referred to the Committee on 

Ways and Means 

A BILL

To amend the Internal Revenue Code of 1986 to require 

a sports franchise to provide for all of the games played 

by the franchise to be available for local television broadcasting in order to be subject to the presumption that 

50 percent of the consideration in the sale or exchange 

of a sports franchise is allocable to player contracts.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Baseball Fan Protec5 tion Act’’. 
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1 SEC. 2. LOCAL TELEVISION BROADCAST REQUIREMENT IN 

2 THE CASE OF SALES OR EXCHANGES OF 

3 SPORTS FRANCHISES. 

4 (a) IN GENERAL.—Subsection (d) of section 1056 of 

5 the Internal Revenue Code of 1986 (relating to presump6 tion as to amount allocable to player contracts) is amend7 ed to read as follows: 

8 ‘‘(d) PRESUMPTION AS TO AMOUNT ALLOCABLE TO

9 PLAYER CONTRACTS.—

10 ‘‘(1) IN GENERAL.—In the case of any sale or 

11 exchange described in subsection (a), it shall be pre12 sumed that not more than 50 percent of the consid13 eration is allocable to contracts for the services of 

14 athletes unless it is established to the satisfaction of 

15 the Secretary that a specified amount in excess of 

16 50 percent is properly allocable to such contracts. 

17 Nothing in the preceding sentence shall give rise to 

18 a presumption that an allocation of less than 50 per19 cent of the consideration to contracts for the services 

20 of athletes is a proper allocation. 

21 ‘‘(2) ZERO PERCENT ALLOCATION UNLESS

22 GAMES FIRST MADE AVAILABLE FOR BROADCAST LO23 CALLY.—

24 ‘‘(A) IN GENERAL.—For purposes of the 

25 first sentence of paragraph (1), an allocation of 
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1 zero percent shall be presumed unless, as part 

2 of the sale or exchange, the transferee agrees—

3 ‘‘(i) to provide notice to, and a rea4 sonable opportunity for, local television 

5 stations to make bids to license or other6 wise purchase the rights to broadcast the 

7 games to be played by the franchise before 

8 offering others the opportunity to make 

9 such bids, and 

10 ‘‘(ii) to accept the highest reasonable 

11 bid from a local television station for such 

12 rights. 

13 ‘‘(B) FREQUENCY OF LOCAL BIDDING OP14 PORTUNITIES.—The notice and opportunity 

15 provided to local television stations shall be pro16 vided each time the transferee sells broadcast 

17 rights during the period that the transferee 

18 owns the franchise. 

19 ‘‘(C) LOCAL TELEVISION STATION.—For 

20 purposes of this paragraph, a local television 

21 station is a television broadcast station (as such 

22 term is defined in section 325(b)(7) of the 

23 Communications Act of 1934 (47 U.S.C. 

24 325(b)(7)) having a local market (as such term 

25 is defined in section 122(j) of title 17, United 
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1 States Code) that includes the entire central 

2 city of the metropolitan statistical area within 

3 which, or closest to which, the home stadium, 

4 arena, or other facility of the franchise is lo5 cated.’’. 

6 (b) EFFECTIVE DATE.—The amendment made by 

7 this section shall apply to sales or exchanges of franchises 

8 after December 31, 1999, in taxable years ending after 

9 such date.

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