good breakdown today on potential CBA looks like:
Traces of a deal?
Owners emerge from meeting; on to Players for potential CBA Andrew Brandt
As the optimistic drumbeat continues towards eventual resolution of the long-running labor dispute between the NFL Owners and Players, we are starting to hear reports of proposed deal points about what may be part of a settlement of Brady v. NFL and an eventual Collective Bargaining Agreement (CBA).
I am optimistic but cautiously so. Again, until everything is agreed to, nothing is agreed to. However, there appears to be some momentum.
As first reported by my colleague at ESPN and someone trusted by both Owners and Players -- Chris Mortensen -- there are proposed deal terms being discussed that reflect key issues analyzed in this space in recent months.
The negotiating team for the Owners presented the basic deal terms to the full membership yesterday in Chicago, with a goal of taking a positive response to a meeting with the Players outside of Boston today. The following details have started to emerge. Let’s take a look.
While the Players have maintained their position for a 50/50 split of all NFL revenues – simplifying the math and setting aside discussions of credits, set-offs, expenses, etc. – the Owners’ offer has steadily climbed from a percentage in the low forties to a present offer of approximately 48%. These two percentage points may end up being the crux of this two-year negotiation, an amount worth $200 million this year andperhaps as much as $400 million by the end of the deal.
Using a present revenue total of $9.3 billion, 48% of that number would result in a Player allocation of $4.464 billion or a team Cap starting in 2011 of just under $140 million. The key would be how much of that number is allocated to salaries and how much to benefits. My sense is the player cost allocation may be around $121 million per team with the other $19-20 million toward benefits.
The Cap and its formulas and allocations are explained here.
As I have said for a year, the revenue split is the issue from which all others flow. It appears to be headed towards a 52/48 split between the Owners and Players.
Within the ultimate question of “Who gets how much?” to be “fair” in future years, there must be downside and upside protection.
In the CBA that expired in March, there was a mechanism called the Cash Adjustment Mechanism (CAM) which credited or debited future team Caps depending on whether Player spending exceeded or fell short of certain thresholds. In most years, the CAM adjustment was an addition to future Caps, meaning there was less spending on players than the established threshold.
I explained the CAM mechanism here when almost $5 million was added to each team’s Cap in 2009 due to it being the last Capped year.
Owners and Players are talking about a similar mechanism now that protects both sides through a formula similar to CAM. With this formula, it is expected that the Player share of revenue will not dip below 46.5% during the life of the CBA.
I have always felt that – for the Players – this is the most important issue of all. Having managed an NFL Salary Cap for nine years, I am well aware that a Cap can be molded and massaged to show whatever a team wants to show. Cap minimums can be reached using various mechanisms that eat up a team’s Cap while providing an excuse to agents and players not to spend.
Cash is king to Players. In March, the Owners offered a 90% cash minimum, which I thought was the most meaningful part of their offer. They have reportedly raised that offer to 95% or even higher. Were I advising Players, I would try to push that Cash minimum as close to 100% as possible.
I would think this potential concession may be receiving the most resistance among ownership.
This would reward teams with solid front offices and savvy “pay as you go” Cap management. With the Packers, I always tried to match our cash spending with our Cap, paying as we went rather than racking up potentially large future “dead money”. That style of management will be rewarded with the proposed new system.
Unrestricted free agency is expected to return to the requirement of four years in the NFL – and an expiring contract – rather than last year’s six-year requirement.
If true, there will be a glut of free agents in a frenzied shopping period; not a good thing for 2011 free agents as it will be a buyer’s market.
Franchise tags are expected to remain, as the NFLPA will not make a big issue of something that affects 10-15 players per year. This would ensure that Peyton Manning stays a Colt and Jim Irsay and Bill Polian need not enroll in witness protection.
We know players at the top of the Draft will be sacrificed. The riches of franchise-killing players such as Ryan Leaf and JaMarcus Russell will never embarrass owners again and Sam Bradford will be the last bonus baby.
Issues still remain between the two sides in addressing the length of first-round deals, guarantee levels and potential upside in rookie contracts.
Despite the strong negative reaction from Players, this issue will hang around the periphery of the new agreement, with a potential ETA of 2014 or 2015, when a good percentage of players currently in the NFL are no longer part of the league.
New television package
With Owners looking under every rock for new revenue streams, it was only a matter of time for this to happen. In recent years, Owners have allowed sponsor inventory to include liquor, lotteries and training camp practice jersey patches, previously unavailable for inventory of sponsors.
The biggest revenue stream of all, of course, is broadcast. With rights fees soaring (see Olympics/Comcast), the possibility of opening up another package for bidding has Owners salivating. Now the Players can share the riches, as they will receive their designated share of what is to be an extremely lucrative 16-game Thursday night package starting in 2014 (after the current deals expire). The NFL Network will likely remain part of the package but certainly not all of it.
Ironically, with the NFL having been scolded by Judge Doty on the negotiation of television contracts for lockout funding – Doty is standing down while the two sides negotiate – it may be the inclusion of the negotiation of another television contract negotiation that helps resolve the lockout.
Owners have used the lack of public appetite for stadium funding as a major reason why their profitability numbers have declined. The Players have accepted that concern to some extent, willing to allow some credits from their Cap for new stadiums to come online.
After the infighting between different groups purportedly representing former players, there will be an enlarged pot of money – with funding from both sides – for this group, especially players that retired before 1993 when benefits increased considerably.
It is noteworthy that Carl Eller was in attendance at the Owners’ meeting with his proposed settlement including the creation of a neutral retiree organization.
Owners are dead set on ending the oversight of the Minnesota court system, the province of Judge Doty and now Judge Nelson. Both sides have warmed to mediator Arthur Boylan, who is both in the negotiations and keeping the Eighth Circuit and Judge Doty at bay from ruling while the talks continue. Boylan may well have a continuing role in the new CBA.
There are obviously more issues to discuss and wrangle over. I look forward to breaking down all of the deal when it is an actual deal rather than a proposed one.
Hope floats, although we’ll keep a lifeguard around, as it can still sink with these fragile negotiations.
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Hoorah, this is finally starting to make sense. Now that both have sides have agreed to the basics concerning the sharing of revenues on a percentage rather than a fixed dollar basis the damn has broken and the nuances can now be dealt with. This is a major concession by the owners from where things stood in March. They get some concessions from the players for increased stadium expenses which benefit the players as well and the players are assured of sharing in revenue growth as it happens and nobody had to truck out audited financials to compromise this way. Once again this takes things to a different dimension than we saw in March.
I was especially pleased to read about the cash minimums and there effect on truing up the difference between cap spending and real spending and even happier that the Bears have been structuring their deals like this for some time now. Free agency after 4 years is fair and no 5 year exception for first round picks. Keep it simple. The dollars saved on these rookie deals gets to benefit the retirees as well so that's a good thing and about time it was dealt with. I don't like the 18 game schedule or the Thursday night game package but those may be prices that have to be paid to keep revenue increasing.
Overall everyone gets something of what they wanted and no one walks away feeling "had". That was the real problem back in March. The owners felt they'd been "had" in 2006 and when they wanted a significant rollback from the players then they felt like they were being "had". So let's soothe all of the ruffled feathers and tell the lawyers and the "hardliners" to clear out and get it done. There's games to play!
I'm getting to that age where a lifetime warranty just doesn't mean as much to me anymore as an afternoon nap. Honey Badger Don't Care. Honey Badger Don't Give a Shit.
A season of unpredictability
Many challenges await NFL front offices, coaches and players once a new deal is reached. Leigh Steinberg
Breathe easy, NFL fans.
A new collective bargaining agreement should be reached in the next couple weeks. As training camps approach, the sides will get to their bottom line and protect the cornucopia of revenue that the NFL generates. As I've said before, no one takes business seriously in the NFL until danger and catastrophe are imminent.
And this is why I’m sure that an agreement will occur and we can all "get ready for some football.”
The interesting question is to try and calculate what impact the offseason lockout will have on franchises this season. Football is a team game that needs structure and planning. It also requires time and practice—especially on the offensive side of the ball—to establish coordination and rhythm. Stability and continuity are key.
The role of the coach is central. Many teams have hired new coaches who have yet to spend any time working with their squads. They have not had the opportunity to evaluate players based on interaction. They may have new game plans and concepts which need time and work for implementation. Franchises like the Packers, Colts, Patriots, Steelers, Saints, and Jets have coaches in place who have years of experience, while teams like the Panthers, 49ers, Titans, Vikings and Browns are rebuilding with brand new or previous "interim" coaching staffs.
The latter will have a tougher time getting off to a quick start during training camp and at the beginning of the season. We may see a number of contests pitting teams that are at varying levels of readiness against one another.
Hundreds of free agents have been waiting all offseason to either stay in place or find a new home. Under normal circumstances they would have signed with new teams long ago and had time and mini-camps to learn a new system and bond with teammates. The teams will have to process hundreds of bargaining sessions and completed contracts in a very short period of time. Unlikely marriages may occur. It will take more time and effort to integrate these free agents.
Hundreds of undrafted rookies are still looking for an opportunity. The cap system necessitates that the 32 NFL franchises need some of these players to make their teams.
Drafted rookies, especially those at positions that require more reps and tutelage, will find themselves way behind. Instead of having playbooks, mini-camps and regular interaction with teams over the last couple months, they will find themselves at a competitive disadvantage. Offensive linemen and quarterbacks need more time to adjust to the NFL. A player like Cam Newton, who would have been expected to start for the Panthers, may see the lack of preseason seasoning block their career arcs.
Under contemporary caponomics, teams need mid to lower round draft picks to make the rosters and be contributors. Again, the lockout will lead to less evaluation and seasoning time in a rushed training camp scenario.
Veterans are traditionally trained and monitored through offseason conditioning programs. Quality control, in respect to their physical and mental condition, has been refined through the offseason. Veterans have not been working with team strength coaches or trainers and we can now expect varying levels of readiness.
Many serious or season-ending injuries occur in the early weeks of training camp. This is because players are in better shape than in earlier years but have had seven months away from the harsh reality of contact. There is a difference between "ready" and "football ready.” Expect a higher level of early injuries.
Players are bold and courageous on the field, but covet structure and certainty in respect to their employer and training rituals. Young players without maturity and self-discipline will be especially impacted.
Once the lockout ends, there will be intense focus on processing all categories of unsigned players. Compressing this much frenetic business activity into so little time has the potential to create more chaos and confusion with franchises that are not administratively sound and experienced.
The list of challenges is endless. It will be a season of unpredictability.
It will be a season of unpredictability alright. With rookies not having the mini camps and OTAs to work on developing a rapport with the veterans on the team, they will not have had the proper beginnings to the maturation process that rookies in past years have had. And nothing, and I mean nothing, makes up for the lack of contact drills as instructed by the coaches for these players, regardless of whether they are veterans or rookies. I expect that the level of play at the very beginning will be, by all teams, off a little bit due to an abbreviated summer of organized team functions.