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by John Czarnecki
Sometimes financial well-being simply doesn't compute. In a resort hotel where coffee costs over $6, many an NFL owner was kind of crying last week about money. Basically, they don't like the current disbursement of league revenue, which amounts to around 60 percent of everything to the players.
To a seasoned listener of this league, it is a foregone conclusion that this November these owners will opt out of the current collective bargaining agreement, one they approved 30-2 just before former Commissioner Paul Tagliabue retired. The vote to disapprove the current deal may be the same!
Granted, there is plenty of time to fix labor relations with the NFL Players Association. We're talking about the most popular sport in America, a virtual money-making machine lately. Yes, the salary cap, which is currently $116 million, may rise to $123 million next year, but there seems to be some concerns among many owners, especially those who own and control their own stadiums, that the individual club profit margin has slipped precipitously.
Let's give you a few examples. The St. Louis Rams may be worth $750 million based on the current Forbes structure, but they only cleared $10 million last season. That's really not a lot of money for such a big business franchise. I mean, some quarterbacks make more than that — and there is the rub. Some of these owners are earning less than their best player.
Obviously, there are a few rich teams like the Tampa Bay Bucs that remain $30 million under the salary cap while also producing a hefty profit of over $35 million last season. But teams like the Bucs are an exception, plus they won the South last season.
Markets like Jacksonville, Buffalo, Carolina, New Orleans, San Diego and San Francisco are being squeezed. Through the years, we have heard that Pat Bowlen, owner the Broncos, has never been good with money and now his new stadium and other expenses are pushing him into the red. Bowlen actually laid off employees last month to save a few dollars.
Nobody is opening their books, but little of this makes sense to the ticket-buying public. Invesco Field is sold out every game and the Broncos are very popular. How can the sky be falling?
Well, everything is going up, including player costs and coaching salaries. Wayne Weaver may want to sell his Jacksonville franchise, but he recently gave Jack Del Rio, his head coach, a raise to $5 million. Weaver felt compelled to keep Del Rio and pay him the going rate while his profit margin dwindles. It's called keeping up with the Joneses.
By opting out of the current deal, union boss Gene Upshaw believes the owners will go on a spending spree should the players reach the uncapped season of 2010. When you see very average offensive linemen earning $6 million a season, it is easy to accept Upshaw's point of view. But there are mechanisms in the deal — free agency goes from four to six years in an uncapped season, plus the franchise tag still exists and the top eight teams will be limited in what they can spend. Fans think Cowboys owner Jerry Jones, who is currently charging $150,000 simply to have the right to purchase tickets in his new stadium, will buy players like the Yankees and Red Sox do in baseball.
Jones says he won't do it because history says the biggest payroll doesn't always win. Football is a team sport that relies on locker-room chemistry and solid coaching. After all, the Patriots won three titles with some bargain-basement performers and Tom Brady.
Also, the mechanism for 2010 is clear that the top eight teams record-wise from the 2009 season will be limited in their pursuit of free agents. In order to offer a player a $10 million contract, they must lose a player or players of equal value. Typically, though, in free agency the non-playoff teams spend the most money on free agents like the Jets, Raiders, Eagles, Vikings and 49ers have done this off-season. This is what Upshaw and the players are hoping for in 2010; that the weak teams will go shopping with unlimited checkbooks.
At the recent meetings in Palm Beach, I spoke with two owners of non-playoff teams who claim to have cleared $10 million or less this past season. They both said that they would use the 2010 season to clean up their economic mess.
"If I spend $40 or $50 million less on player salaries that year, I can start to get a handle on my franchise debt," one NFC owner said. "I think many of us who are in the middle of the economic ladder will curtail player spending and try to get our own houses in order. I guess a lot of us were either naive or didn't see the future very well when we agreed to this deal."
Who knows how serious the owners are about curtailing player payrolls? This is the same group that has gambled on the NFL Network and has collectively decided to stay the course there despite revenues well below what the eight-game package would have been worth had it been sold to Comcast or a national network.
But for the first time I actually heard an owner talking about a lockout for the 2011 season if there is no new deal with the players or if the federal court system doesn't impose a rational formula for labor peace. I was around for the 1987 season when three regular-season games were played by scabs off the street. I also witnessed the 1982 season that lost seven games to a strike.
"We're prepared to do that all again," the other owner told me. "I'm confident that the fans will come back even if they miss four to eight games that year. We have to get our finances under control."
With the Giants and Jets embarking on a $1.6 billion stadium in New Jersey and Jones building another billion-dollar park in Arlington, it doesn't make sense to have a dark cloud over the NFL's future. But we all know that people don't settle unless it makes sense to both sides. Right now, the current CBA doesn't make any sense to the owners and they sound ready for a serious fight.
Sometimes financial well-being simply doesn't compute. In a resort hotel where coffee costs over $6, many an NFL owner was kind of crying last week about money. Basically, they don't like the current disbursement of league revenue, which amounts to around 60 percent of everything to the players.
To a seasoned listener of this league, it is a foregone conclusion that this November these owners will opt out of the current collective bargaining agreement, one they approved 30-2 just before former Commissioner Paul Tagliabue retired. The vote to disapprove the current deal may be the same!
Granted, there is plenty of time to fix labor relations with the NFL Players Association. We're talking about the most popular sport in America, a virtual money-making machine lately. Yes, the salary cap, which is currently $116 million, may rise to $123 million next year, but there seems to be some concerns among many owners, especially those who own and control their own stadiums, that the individual club profit margin has slipped precipitously.
Let's give you a few examples. The St. Louis Rams may be worth $750 million based on the current Forbes structure, but they only cleared $10 million last season. That's really not a lot of money for such a big business franchise. I mean, some quarterbacks make more than that — and there is the rub. Some of these owners are earning less than their best player.
Obviously, there are a few rich teams like the Tampa Bay Bucs that remain $30 million under the salary cap while also producing a hefty profit of over $35 million last season. But teams like the Bucs are an exception, plus they won the South last season.
Markets like Jacksonville, Buffalo, Carolina, New Orleans, San Diego and San Francisco are being squeezed. Through the years, we have heard that Pat Bowlen, owner the Broncos, has never been good with money and now his new stadium and other expenses are pushing him into the red. Bowlen actually laid off employees last month to save a few dollars.
Nobody is opening their books, but little of this makes sense to the ticket-buying public. Invesco Field is sold out every game and the Broncos are very popular. How can the sky be falling?
Well, everything is going up, including player costs and coaching salaries. Wayne Weaver may want to sell his Jacksonville franchise, but he recently gave Jack Del Rio, his head coach, a raise to $5 million. Weaver felt compelled to keep Del Rio and pay him the going rate while his profit margin dwindles. It's called keeping up with the Joneses.
By opting out of the current deal, union boss Gene Upshaw believes the owners will go on a spending spree should the players reach the uncapped season of 2010. When you see very average offensive linemen earning $6 million a season, it is easy to accept Upshaw's point of view. But there are mechanisms in the deal — free agency goes from four to six years in an uncapped season, plus the franchise tag still exists and the top eight teams will be limited in what they can spend. Fans think Cowboys owner Jerry Jones, who is currently charging $150,000 simply to have the right to purchase tickets in his new stadium, will buy players like the Yankees and Red Sox do in baseball.
Jones says he won't do it because history says the biggest payroll doesn't always win. Football is a team sport that relies on locker-room chemistry and solid coaching. After all, the Patriots won three titles with some bargain-basement performers and Tom Brady.
Also, the mechanism for 2010 is clear that the top eight teams record-wise from the 2009 season will be limited in their pursuit of free agents. In order to offer a player a $10 million contract, they must lose a player or players of equal value. Typically, though, in free agency the non-playoff teams spend the most money on free agents like the Jets, Raiders, Eagles, Vikings and 49ers have done this off-season. This is what Upshaw and the players are hoping for in 2010; that the weak teams will go shopping with unlimited checkbooks.
At the recent meetings in Palm Beach, I spoke with two owners of non-playoff teams who claim to have cleared $10 million or less this past season. They both said that they would use the 2010 season to clean up their economic mess.
"If I spend $40 or $50 million less on player salaries that year, I can start to get a handle on my franchise debt," one NFC owner said. "I think many of us who are in the middle of the economic ladder will curtail player spending and try to get our own houses in order. I guess a lot of us were either naive or didn't see the future very well when we agreed to this deal."
Who knows how serious the owners are about curtailing player payrolls? This is the same group that has gambled on the NFL Network and has collectively decided to stay the course there despite revenues well below what the eight-game package would have been worth had it been sold to Comcast or a national network.
But for the first time I actually heard an owner talking about a lockout for the 2011 season if there is no new deal with the players or if the federal court system doesn't impose a rational formula for labor peace. I was around for the 1987 season when three regular-season games were played by scabs off the street. I also witnessed the 1982 season that lost seven games to a strike.
"We're prepared to do that all again," the other owner told me. "I'm confident that the fans will come back even if they miss four to eight games that year. We have to get our finances under control."
With the Giants and Jets embarking on a $1.6 billion stadium in New Jersey and Jones building another billion-dollar park in Arlington, it doesn't make sense to have a dark cloud over the NFL's future. But we all know that people don't settle unless it makes sense to both sides. Right now, the current CBA doesn't make any sense to the owners and they sound ready for a serious fight.
