The NFL and Players Union Light the Fuse
Written by B-Dub, Tuesday June 30 2009
The NFL Collective Bargaining Agreement (CBA) is set to expire after the 2010 NFL season, because the owners opted out of the current deal last spring. "And Boom goes the dynamite".
The new executive director of the NFL Players Association, DeMaurice Smith, has taken a far different tact in his early negotiations with the NFL than his predecessor, Gene Upshaw. While Upshaw was seen as a partner with NFL Commissioners, Smith seems to be taking an adversarial stance.
First Smith brought up the possibility of asking Congress to examine the league's tax-exempt status and its limited anti-trust exemption if the owners don't bargain in good faith in the upcoming negotiations for a new labor deal. Then Smith urged the owners to open their books and show the union why the current labor deal is no longer economically viable. Talk about bringing out the big guns early.
"I'm not sure that's the right tone you want to set going into the negotiations," said one league executive. For his part, Smith was unapologetic. "The basic function of a financial statement is to give you an accurate snapshot of what the profit-loss and revenue of a team is. That's what we don't have," he said. Hey, at least he isn't still threatening Congressional intervention right?
What the union does know is that the NFL produces $8 billion in revenue, because that was the figure used to calculate the salary cap. The problem from the owners' perspective is that too much of their share of that $8 billion is being eaten away by costs, including stadium debt. The current terms of the CBA give 60 percent of the league's total football revenue to the players. The owners think that is too high, which is why they opted out of the current deal. And that is why we might just be in for a work stoppage after the 2009 season.
"That 60 percent number was the magic number for Gene Upshaw, " said former Kansas City Chiefs president Carl Peterson. "The problem was, the owners not only agreed to the percentage but also acquiesced on making it 60 percent of designated gross revenues. Which really got into the owners' pockets with suites and concessions and parking and all that. The players have to understand that the owners are trying to run a business that does have overhead," Peterson added. New stadiums increase the revenues that go into determining the value of the salary cap, but the owners are complaining that they don't get a salary cap credit for the debt they incur building those stadiums.
This is the part where you all bitch and moan about the owners getting money from cities and states to build their new playpens. I hear you. I was personally screwed by the penny-pinching bastards who run the Eagles when they built Lincoln Financial Field. Because I didn't want to pay the $5,000 cost (extortion) of a SBL (Stadium Builder License) I lost my great seat location and was moved up to the BYOT (Bring Your Own Telescope) seats in the new stadium. Plus, let's not forget that the NFL made $8 billion in revenue last year. Hearing them complain about having to pay off some debt to build those new stadiums is a little hard to take in these tough economic times.
The thing is, the owners do have a point. The players want to reap all the benefits of the immense popularity of the NFL, without taking on any of the financial risk. The counter argument is that the players are the league. They are the ones who actually play the game, which draws the fans and their dollars to the league. While that is a valid point, the owners and commissioners, like Pete Rozelle, are the ones that made football the behemoth of the sports world that it is today. And that is why the players get paid such huge salaries.
In any case, the league and the players union are on a collision course at the end of the 2009 season. If there is no deal by March 2010, there will be no salary cap in 2010. Smith has already echoed Upshaw in saying that the union will never agree to reinstitute a salary cap once it goes away.
I'm here to tell you that the salary cap will never go away, because the owners will lock out the players before that ever becomes a possibility. The owners want a salary cap and they will not play a season without one. Why should they? The owners hold all of the cards, since they run the league. The players are just the employees. That may seem like an over-simplification, but it's true. The players are paid by the owners who run the teams, so the don't have as much say in the matter. That's just a reality of the business world. And don't forget, sports today are a business.
Another issue is that if there were somehow an uncapped year, it would also increase the amount of service time that a player would have to accrue to become a free agent. Under the terms of the current deal, if there is an uncapped year the amount of time a player has to accrue to be eligible for unrestricted free agency goes from four years to fives years. That is an eternity in the NFL, where the average career is only three and a half years long.
I also don't understand why the players, with Smith as their leader, want to push so hard. The last time there was a strike, the owners held their ground until the players union crumbled and individual players started crossing the picket line. The best part of that for me was that the hated Cowboys led the charge across the picket line. "America's Team" indeed. If there is a lockout, the players will give in faster than the owners due to the simple economics of their situation. Plus, it will be easier for the owners to remain united than it will for the players to do so. The owners know it's a business, because they are all businessmen. The players are just athletes for the most part.
Some players seem to get it. Eagles safety Quintin Mikell said "Sometimes you have to think of it like a business. I don't want it to get to a lockout." He realizes that an uncapped NFL wouldn't necessarily be the financial bonanza that many players seem to think. "When you look at uncapped, you think people are going to go out and spend an unlimited amount of dollars," he said. "But that's not the case. An uncapped year, it can be great for some, it can be bad for some." Right, because for every Jerry Jones or Daniel Snyder, who would spend as much as they wanted, there are also owners like William Clay Ford in Detroit or Mike Brown in Cincinnati, who wouldn't spend anything. Not only would the cap go away, but the minimum amount of money each team must spend on player salaries would also go away. "At the end of the day, we don't want it to get to that point."
None of us do Quintin, none of us do. If it gets to that point, well, "Boom Goes the Dynamite".
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6 comments
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RoDFW, the NFL players have no idea how good they have it. The make a majority of the money while taking on none of the financial risk. Their only risk is injury, but that's the same in ANY sport. If they go on strike or the owners lock them out the union will crumble just like it always has in the past. I like your point about 90% of the money going to 10% of the players too. So true.
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I can't imagine that the player union would be stuck on the salary cap. The NFL is just like the rest of the country. 90% of the salary's go to 10% of the players (maybe a little more or less). With no Salary cap your average player wouldn't get anything. I don't see anything wrong with guaranteed contracts but I would think they should guarantee only a percentage of the remaining $$. I would be interested in knowing if any other union is getting 60% of the gross from thier company.
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Ryan, trust me. There will NEVER be an NFL season without a slaray cap. Why? Because the owners don't want it to be that way and it's their league. The owners "own" the teams, so they get to make the rules. If the players don't like it they can take their college educations (muffled laugh) and get a job in the real world. If it ever came to that Donovan McNabb would be making funny faces and telling people that HE is the leader of the cardboard box his is living in on the street.
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I hope you're right about the salary cap NEVER going away, but im not convinced this will be true. As in baseball, it will be the haves (Dallas, Wash, NY teams, etc.), vs. the have nots (GB, Indy, teams with old stadiums that dont generate suite revenue), and just maybe they reach a revenue sharing deal. That would screw us Eagles fans as Lurie is cheap and will hide revenues to make the team look broke. We'll see.
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SeanO, you should know by now that if I write it, it's a FACT. I did read that the NFL was exempt and it shocked me too. I even read parts of the Collective Bargaining Agreement to double check some facts and it gave me a migraine. Nothing but the best for my loyal readers. As for the players, they are fools if they think they can win a battle against the owners. They should take whatever they can get and be happy they don't have to live in the real world with the rest of us.
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The NFL is tax exempt? Are you sure? That's ridiculous. Why do they get a free ride? The one issue the owners MUST hold firm on is guaranteed contracts. Guaranteed contracts have ruined the NBA. Players have to realize that the owners can weather a lockout\strike MUCH longer than they can. How many players are willing to sit out an entire year or longer when the average career is only around 3 years? Especially when there is a fresh crop of players every single year coming out of college?