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SBD/March 18, 2011/Leagues and Governing Bodies
NFL Lockout Watch, Day 7: Revenue Share Helped Sink NFL-NFLPA CBA Talks
Published March 18, 2011
The NFL and the NFLPA during their unsuccessful collective-bargaining negotiations earlier this month significantly narrowed their differences on the highly publicized cost credit the league wanted, but a greater issue emerged that helped crater the labor talks: how much each side would capture of future revenue growth. The league for the first time since the '93 CBA proposed unlinking the salary cap from overall revenue. Instead, it would have set the cap at a fixed amount each year. “They were trying to make salary a fixed cost and, in the past, it had been a percentage of revenues,” said Pete Kendall, a former NFL player who is advising the NFLPA and was present at the majority of bargaining sessions held over the past two years. “In the past, if revenues went up, the salaries went up.” The league’s proposal was a problem for the union because it wanted to share, as it had in the past, in the benefits of future growth. The NFL’s position was twofold, sources said: The union in its own proposal offered no downside protection to the league if revenue declined; and if the players were unwilling to shoulder substantially more costs, then why should they be entitled to all the growth those costs helped generate (Liz Mullen & Daniel Kaplan, SportsBusiness Journal)
DOLLARS & SENSE DON'T MATCH UP FOR PLAYERS: In Boston, Ron Borges cites sources familiar with the NFL's final CBA offer to the players last Friday as saying that the NFLPA's "projection was that the players would in four years have seen their share of total gross revenues tumble" from the present 57% to 38%. In addition, "each year would have seen that share reduced regardless of the size of the money pool." A source said, "In their model the better the league did the worse the players did. At the 11th hour they completely changed the context of the negotiation. ... It was their way of blowing up the deal." Retired NFLer Sean Morey, a member of the NFLPA Exec Committee, said, "Jerry Jones sat across from us and said he’s a professional optimist. Damn right he is. He understands the league now is more profitable than ever, and the amount of money they’re able to make down the road is something I believe they don’t want to share." Morey added, "Really what the NFL (hopes to do) is privatize its profit and socialize its costs" (BOSTON HERALD, 3/18). The players have asked the owners to "open their books to justify the money they are asking for." Morey said that in response to that request, the owners said, "Even if we provided that information, you wouldn’t be able to understand it." Morey added, "I think the perception that they’ve given us, that players have, is that the league is kind of using the economic distress of our country, where people are struggling to pay their mortgages and keep their jobs, to justify asking players to give back the most significant giveback in NFL history" (BOSTON GLOBE, 3/18).