NFL salary cap could drop by $70 million per team next season?

[Qcard]

I just don’t think allowing a drop of $70 mil in one year is even feasible. Teams literally wouldn’t be able to field squads. I know it’s all about the money. But are teams having to cut some of their best players to fit them under a lowered cap, is that in their best interests financially, long term?


I imagine they will slow down the growth of the salary cap, rather than let the cap itself drop in one season.

IMO.

Nope it's happened before....the Owners will have an Uncapped year to mitigate an unreasonable cap.

This is a self imposed penalty by the Owners

 

[Roadtrip635]

One solution I heard being discussed was to "freeze" the salary cap and next years cap would "borrow" from future seasons. Basically next years cap would remain the same as this seasons and depending on how much revenue was lost, there would be no salary cap increase for the next couple of seasons or maybe just smaller than usual increase.

There could be a situation where the cap remains the same for 2-3 seasons. There is no way the cap would be cut that drastically, the cost would be spread out over multiple seasons.

 

[fivetwos]

Nope it's happened before....the Owners will have an Uncapped year to mitigate an unreasonable cap.

This is a self imposed penalty by the Owners

Penalty?

 

[Ranching]

If they start the season, the players get paid. If I'm an owner, I cancel 2020, cut my losses. I'm sure the players will appreciate their jobs more than ever. No play, no pay!

 

[conner01]

Itll be worked out.

Neither the players or owners want this to happen.

The cap is a percentage of revenue
Revenue will go down
Cap will go down
Is there a fix? Yes
Will players like borrowing from the future or owners for that matter which could flatten growth for a few years, no
That’s the only real option though
Otherwise salaries plummet

 

[khiladi]

Even the Kraft Group has been taking a beating the last four years and that includes the Holdings in the NE Patriots. They are highly leveraged.

https://www.investopedia.com/kraft-heinz-stock-could-enter-new-uptrend-4800683

The Rams just built a 5 billion dollar stadium and they had to borrow from the NFL. That’s already looking like a major loss and the NFL was planning to shift to the stadium their central office.

https://sports.yahoo.com/nfl-owners...r-rams-5-billion-so-fi-stadium-035601453.html

They haven’t even finished the stadium and now workers have the virus. How many times are the elite going to hide behind the virus to cover their economic losses that are highly-leveraged and bad investments. They were behind way before this hit anyways.

https://sports.yahoo.com/nfl-owners...r-rams-5-billion-so-fi-stadium-035601453.html

 

[khiladi]

If they start the season, the players get paid. If I'm an owner, I cancel 2020, cut my losses. I'm sure the players will appreciate their jobs more than ever. No play, no pay!

Thats probably what’s going to happen. The difference between players and owners is that latter have a whole bunch of lawyers and financial experts that tell them how to write off their money and shelter themselves.

 

[PhillyCowboysFan]

NFLPA head suggests that salary cap could drop by $70 million next season





Lindsay Jones
@bylindsayhjones
·
Jul 17, 2020
Replying to @bylindsayhjones
DeMaurice Smith: "We are all trying to get to the right decision more so than getting to the fast decision."




Lindsay Jones
@bylindsayhjones
DeMaurice Smith said there are estimates that each team could lose $70 million in 2020, which could mean a 2021 salary cap of around $120M.


As the NFL looks to start its 2020 season on time in less than two months, there’s some major financial components to it all amid the ongoing pandemic.

We’re seeing somewhat of a split between the players and league as it relates to how salary structures will work during a 2020 season that likely won’t seen fans in attendance.

https://sportsnaut.com/2020/07/nfl-salary-cap-could-drop-by-70-million-per-team-next-season/

@xwalker

 

[Ranching]

Thats probably what’s going to happen. The difference between players and owners is that latter have a whole bunch of lawyers and financial experts that tell them how to write off their money and shelter themselves.

The smart players do too.

 

[Aviano90]

The smart players do too.

Don’t even have to be smart. You just have to not be an idiot. Players have access to a ton of resources to help them out.

 

[khiladi]

Probably one biggest factors for sports in general is local TV revenues are down and TV revenues are the bread and butter of their industry. If games aren’t shown, then those revenues are no longer there.

Local TV Ad revenue was already down 15% from 2018 and 2019, before Corona.

The salary cap is primarily dictated by this revenue now. People keep assuming economic growth is always going upwards. It’s not and never has.



https://www.mediapost.com/publicati...ad-revenues-estimated-to-fall-in-2020-20.html

 

[khiladi]

The smart players do too.

I was just speaking generally, but you are no doubt correct. I’m sure it’s improved somewhat for athletes in general, but it’s probably still far in between.

 

[HungryLion]

There would likely be pay cuts agreed to by the players association that would offset sone of the cap hit of that's the case.

I wouldn’t be so sure that players with guaranteed portions of their contracts are going to just agree to 70 million worth of cuts per team for one season


If I was a star player, with a lot of guaranteed money left. I would tell the team to pound sand, personally.

 

[khiladi]

If sports didn’t exist, even with the drop last year when sports was being played, ad revenue would be horrible. Projections are built off this. So sports teams aren’t going to increase the salary cap based on this notion the growth will continue.

https://variety.com/2020/tv/news/ad...mmets-standard-media-index-sports-1234693005/

 

[fivetwos]

I don't think I could be a fan of a team that I hate the owner with a passion

I was there before him, or no one consulted me on the purchase, which would have been all fine, until he decided to waste 25 years of everyone's time while him and his kids try to figure out how to run a football team.

They seem to be reasonably close. Another decade or so and they will realize their best bet is to hire someone to do it for them.

 

[khiladi]

I wouldn’t be so sure that players with guaranteed portions of their contracts are going to just agree to 70 million worth of cuts per team for one season

Legally that would be pretty hard. But there is the whole truly guaranteed versus somewhat guaranteed..

The Houston Rockets BTW are the first team to sue insurance companies for economic losses from COVID, so they are clearly feeling the pinch.

https://www.bizjournals.com/houston...ockets-sue-insurance-company-coronavirus.html

One can imagine how much the owner lost from his hotels and casinos. The fact is insurance companies are investment firms and if they have to pay out this much money, this would completely rock the markets. Plus, it would affect all our premiums. I mean we really don’t even know how much money the gov’t just pumped into the economy. It’s probably way higher than what’s been reported.

The accounting rules value based on this concept where you write off debt, which completely obfuscates the real value. Does one honestly think the Clippers was worth 2 billion?

 

[tm1119]

One solution I heard being discussed was to "freeze" the salary cap and next years cap would "borrow" from future seasons. Basically next years cap would remain the same as this seasons and depending on how much revenue was lost, there would be no salary cap increase for the next couple of seasons or maybe just smaller than usual increase.

There could be a situation where the cap remains the same for 2-3 seasons. There is no way the cap would be cut that drastically, the cost would be spread out over multiple seasons.

This makes a lot of sense. Also wouldn’t be surprised to see owners ask players to defer $ to future years...but the cap suddenly dropping $70 mil doesn’t even make sense. 0% chance that happens.

 

[HungryLion]

Legally that would be pretty hard. But there is the whole truly guaranteed versus somewhat guaranteed..

The Houston Rockets BTW are the first team to sue insurance companies for economic losses from COVID, so they are clearly feeling the pinch.

https://www.bizjournals.com/houston...ockets-sue-insurance-company-coronavirus.html

One can imagine how much the owner lost from his hotels and casinos. The fact is insurance companies are investment firms and if they have to pay out this much money, this would completely rock the markets. Plus, it would affect all our premiums. I mean we really don’t even know how much money the gov’t just pumped into the economy. It’s probably way higher than what’s been reported.

The accounting rules value based on this concept where you write off debt, which completely obfuscates the real value. Does one honestly think the Clippers was worth 2 billion?

I think we haven’t even felt the full effects of what’s going to happen to the economy yet. We will be feeling the impact waves for years.

 

[Redball Express]

If that rumor is true this will be Dak’s last season as a Cowboy. No way they can afford to pay him $38 million if the salary cap is $120 million. That’s 31.6% of the cap for just one player.

Another case of classic mismanagement by Jerry Jones.

Sorry?

Now Jerrah should have known about a World Wide Pandemic and included provisions in contracts to account for it?

Now Jerrah is at fault becuz Dak is overstepping what he is worth?

I have been saying for month this virus was going to completely change sports as we know it.

Nobody wanted to discuss it. All I got was crickets.

We going to watch everything change now. If teams get hit with waves of sickness requiring isolation for 14 days..

we will have to move backups into starting roles immediately, we will special teams
guys starting, the whole product will look like HS. Some players may have to play both ways.

No paying customers? They will have a 10 game season and maybe 2 rounds of p!layoffs and a SB.

Get ready for the weirdest season you could ever imagine.

Personally I think they should just stop the season and wait until the vaccine appears in 2021.

 

[Kingofholland]

I wouldn’t be so sure that players with guaranteed portions of their contracts are going to just agree to 70 million worth of cuts per team for one season


If I was a star player, with a lot of guaranteed money left. I would tell the team to pound sand, personally.

I'm sure some players would feel that way, but remember star players aren't the majority in the league so if there's a vote how they feel may not matter. Besides if teams end up dumping players for space and the cap is that much lower there may not be a team willing to offer 50% of what they're looking for. Concessions would be in everyone's best interest.