SBD/Issue 129/Leagues & Governing Bodies

Have Patience: No Timetable For Goodell, Smith To Discuss CBA

Writer Says Smith Has Essentially
One Year To Complete Labor Deal
NFL Commissioner Roger Goodell said that there is “no timetable or schedule for talks to be held” with new NFLPA Exec Dir DeMaurice Smith concerning the league's CBA, according to Howard Balzer of the GREEN BAY PRESS-GAZETTE. Goodell said Smith is "transitioning from his job, so there will be a schedule developed later." Goodell, who met with Smith on Friday, said, “He’s an impressive guy and I look forward to working with him” (GREEN BAY PRESS-GAZETTE, 3/24). Washington Post reporter Mark Maske said of Smith, "He has a ton of work (to do). A person coming from outside the NFL and the clock is ticking. We have essentially one year to get this labor deal done if you're going to save the salary cap system. You're going into an uncapped year a year from now, so I think from the owners' perspective, there's a lot of uncertainty. Here is a guy that they don't know. ... There has to be a learning curve on both sides now." Maske added the "long-standing labor peace that the NFL has had is threatened in a way it hasn't been before." Maske: "You look at it now: DeMaurice Smith coming in, he faces pressure in two different ways. He faces pressure as the new guy in that will he end this long-standing labor peace? Or does he agree to givebacks after Gene Upshaw got 60% of the revenues for the players in the last set of talks? I don't think the players want to give any of that back. The owners want them to. So from both sides, it's a very difficult set of negotiations” ("NFL Total Access," NFL Network, 3/23).

LOOMING LABOR UNREST: Goodell said of the possibility of an uncapped season in ’10, “I don’t believe that will be the case.” Goodell: “Right now our entire focus is how do we make sure we understand our priorities in the collective bargaining process and work to create an agreement.” Goodell said that player costs “increased by $500[M] over 2008 and 2009” (USA TODAY, 3/24). But in St. Louis, Jim Thomas writes the NFL and NFLPA are “edging ever closer” to a labor impasse. The current economic recession “has magnified the issues separating both sides,” and “compounding the issue from an owner’s standpoint is the fact that more and more NFL teams are at least partially financing new stadiums.” Texans Owner Bob McNair: “The owners have more debt; the league has more debt. These stadiums cost so much, and in the past, they were municipally financed.” Goodell: “There’s a lot of risk out there, and that risk is falling on the owners. I think there’s got to be a recognition of the costs that are associated with operating NFL franchises. That includes stadiums. That includes operating teams and building stadiums” (ST. LOUIS POST-DISPATCH, 3/24). McNair added, “We need a structure that works long-term. We can’t expect the fans to pay more and more and more. We have to hold all our expenses down and labor is just one of them” (AP, 3/23).

BRACING FOR A STOPPAGE: SI.com’s Don Banks wrote, “I’ve gotten -- really for the first time -- a growing sense that the league’s impending labor showdown will all but assure a season with no salary cap in 2010, with a decent bet for a subsequent work stoppage in 2011.” People in the league are “not only bracing for an uncapped season, they’re preparing for it as if it’s almost a given at this point.” Patriots Owner Robert Kraft said of an uncapped year, "It's not scary at all to us. There are a lot of pluses to it. It's definitely not a doomsday scenario, and it might have to happen to get things right." One GM said, “I can’t imagine we get a deal before there’s a work stoppage at this point. The players are going to dig in, and that’s where this thing is headed.” An NFL team source said that “some owners have implemented far-reaching contingency plans into their business operations that reflect the potential for no season in 2011.” A league source also indicated that some NFL owners with “particularly huge slices of debt service on the new stadiums that they own and operate have even prepared for a possible work stoppage in 2011 by having ‘Force Majeure’ clauses inserted into their contracts -- which frees one from liability when an extraordinary event or circumstances beyond the control of the parties prevents one from fulfilling their obligations” (SI.com, 3/23).

McNair Says People's Spending Habits
May Not Be The Same As In The Past
ARE OWNERS POSTURING? In N.Y., Judy Battista writes it is “difficult to tell whether the NFL’s hand-wringing is because the league is suffering or because it is beginning the posturing that will take place during negotiations with the players.” McNair: “We have to recognize that after this, things might not be the way they were before. People, their habits in the future might not be the same as in the past, their spending.” Goodell conceded that he “expected season ticket renewals for 2009 to suffer in some markets” (N.Y. TIMES, 3/24). In L.A., Sam Farmer notes the “focus of Goodell’s state-of-the-league talk to owners Monday was the financial challenges ahead and the innovative thinking required to attack them.” But Farmer wonders, “Are teams truly concerned about their ability to pay the bills in the midst of an economic crisis, or are they merely posturing for what figures to be a nasty battle over sharing revenues with players?” (L.A. TIMES, 3/24). Eagles President Joe Banner: “There certainly are businesses out there who are being much more affected than us. But we’re certainly affected. In an ordinary year, you have some club-seat holders that move or somebody passes away or their economic condition changes. But it’s usually a pretty modest number. This year, it’s more than that.” More Banner: “Our car dealership sponsorship is virtually gone. And that's a very big category. Some of the bank categories are very challenging. To the extent that people that support us are impacted, whether it be a fan or (sponsor), we're impacted" (PHILADELPHIA DAILY NEWS, 3/24).

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