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The New York Cosmos are closing up shop, and they’re taking NASL with them

The current second division of American soccer is dead. What will the new second and third divisions look like? Your guess is as good as ours.

Soccer: Carolina Railhawks at New York Cosmos Anthony Gruppuso-USA TODAY Sports

Following rumors of financial turmoil last week, the New York Cosmos told the North American Soccer League that they have ceased operations, according to Michael Lewis at Big Apple Soccer. This news is not a shock, but it’s still a bitter blow to a struggling league that was trying to stay afloat after losing multiple teams this offseason — and it’s almost certainly the blow that will take NASL out for good.

The club is up for sale and could be revived, but it won’t be in time to save NASL. Any potential buyers are also unlikely to retain the Cosmos’ championship team and staff, who have been released from their contracts because they’re not being paid anymore.

NASL has been around for less than a decade — the league just celebrated its seventh birthday earlier in November — but never managed to mount a serious challenge to MLS and gain first division status. There were hopes that the return of the Cosmos in 2013 would attract more investors and more teams to the league, but those dreams never came to be.

In May 2015, former NASL chairman of the board Aaron Davidson was indicted as part of the FIFA corruption scandal. Davidson ran Traffic Sports USA, which once controlled three of NASL’s clubs and had a large stake in a fourth while regularly loaning players they owned to NASL teams. At the time of Davidson’s indictment, they controlled one team, which was sold as quickly as possible. Davidson has since plead guilty to racketeering and wire fraud.

Knowing that their days were numbered after that mess, NASL threatened to file a lolsuit... err, lawsuit... in August of 2015 accusing U.S. Soccer and MLS of violating antitrust law for moving the goalposts on requirements to gain first division status. Their protest went nowhere.

NASL could never get past the financial woes that have plagued lower-division soccer in the United States for decades, but it certainly didn’t help that the Cosmos showed the financial discipline of an 18-year-old who just got some killer graduation presents.

NASL’s expansion decisions were also short-sighted and always doomed to fail. Most notably, they admitted an Oklahoma City franchise even though the city already had a USL team that was drawing well. They partnered with Spanish team Rayo Vallecano, who could not fund Rayo OKC after the parent club was relegated from La Liga.

If there’s a defense of NASL, it’s that they were forced to take on poorly thought out franchises due to multiple clubs jumping ship to MLS — the Montreal Impact made the jump first, Minnesota United just completed their final NASL season as they prepare to step up to MLS, and the Atlanta Silverbacks dropped down to the fourth tier when Atlanta got their own MLS franchise.

This offseason, NASL’s issues were exacerbated by multiple clubs moving to United Soccer League, a third division league that has become very stable thanks to a healthy partnership with MLS. The Tampa Bay Rowdies and Ottawa Fury informed NASL that they’d be jumping ship well before anyone knew the Cosmos were ceasing operations, and some of NASL’s other remaining clubs are expected to join those two in making the move this week.

The MLS-USL partnership, in hindsight, was the beginning of the end for NASL. It gave USL a platform of stability that NASL never really had — a source of of quality players and reliable attention from fans and media that helped USL grow and evolve, and ultimately move past the NASL in the pecking order of soccer in the United States.

NASL isn’t officially gone yet, but the loss of the Cosmos is a death blow the league almost cannot recover from. The Cosmos were the league’s one big shining beacon of quality and hope, their supposed financial savior and path to the future. Apparently, the Cosmos’ owners got sick of bleeding money, and for good reason. There was no lucrative endgame for the Cosmos or NASL.

With the Cosmos falling to financial oblivion and closing up shop, there’s just not enough left for NASL to rise up again, and no reason for new teams to join the league. As laudable as they’ve been in the past, teams like the Carolina Railhawks (soon to be North Carolina FC) and Indy Eleven can’t hold up the NASL at this point. Forget D2 — the league won’t even have enough teams to meet third division standards if its remaining members decide to hold firm and refuse to join USL. There is no way back.

USL is expected to gain second division status for next season, though that’s not yet set in stone. Brian Quarstad of Fifty-Five One is reporting that U.S. Soccer is trying to make sure they have an established second division for next year. Here’s the key info from his piece.

A source with information of the situation said it “appears that the NASL is officially dead.” ... The source also said there is “behind the scenes pressure being applied by USSF to maintain one D2 league, be it NASL or USL so that the official story is D2 never went dark.”

Which teams end up with D2 and D3 status next year is anyone’s guess. USL had 29 teams in 2016, and it’s extremely unlikely — bordering on impossible — that they will attempt to operate a second division league with that many teams. Many of USL’s teams will also not want or be able to meet USSF’s financial and stadium requirements for second division status. The 30-plus teams in second/third division limbo look likely to be split up into two tiers based on what their ownership groups want to do and can afford, though this is all very much up in the air.

USL formerly operated the second and third divisions of American soccer as USL-1 and USL-2 from 2005 to 2010, with NASL operating as a co-D2 organization in a combined league with USL-1 for one season. After that, some USL-1 teams joined NASL, while others dropped down to the newly combined USL in the third tier.

It’s unfortunate that the NASL is folding, even though the league wasn’t particularly popular or well-run. Even though most remaining NASL teams should find homes in the USL or a new third division if they want to stick around, some fans will soon be without a local team. Fewer soccer teams in America is never a good thing.

Hopefully everyone involved in American soccer can learn from the mistakes that NASL and the Cosmos made, setting up healthy second and third divisions for years to come. But given the history of lower-division soccer in America, you probably shouldn’t count on that.