Random CBA Musings

Salary Cap Random CBA Musings

Posted in Salary Cap
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Having taken the weekend to digest all of the reports, accusations and “what’s next’s” of the NFLPA’s decision to decertify and the NFL owner’s decision to impose a lockout, the following random thoughts come to mind:

.         There is over $9B worth of revenue to be divided, both sides should have been able to find a way to make a deal.  Whether it’s greed or hubris, whatever, there is no way that both sides should not have been able to find a middle ground. 

·         What does 10 years of financial records have to do with anything?  The NFLPA reportedly sought 10 years of audited financial records from the NFL owners and would not relent.  This seems greatly excessive, especially in light of the fact that the last CBA was agreed to in 2006, just 5 years ago.  So, what relevance to the present negotiations would financial records from 2001-2005 have?  Simply put, nothing prior to the 2006 CBA has any relevance now. 

·         Based on most reports, it would appear that the only real issue remaining was how to divide up that $9B pie.  The issues of rookie salary cap, health benefits, 18-game schedule, etc., appeared to be pretty much settled (or easily resolved).  The NFL owners originally sought a $2B credit off the top for stadium costs and expense credits.  This amounted to an additional $1B over what the owners were receiving under the terms of the 2006 CBA.  Various reports have indicated that the owners reduced their request for that additional $1B down to around $650M, and then later offered to split the difference with the NFLPA.  So, if accurate, the Player’s Association declined that offer, which would have given the NFL an additional $325M toward that expense credit.  In real dollars, though, since 60% of every dollar, after the credit, went to the players under the old CBA, the players were essentially only giving the owners an additional $194M. 

That said, other reports seem to indicate that the NFL’s proposal would have reset the 2011 Salary Cap at $114M.  For perspective’s sake, the Salary Cap in 2009 was $123M (which after the CAM adjustment, went up to $128M). 

Also, for what it’s worth, the Ravens already have over $128M counting toward the 2011 Salary Cap.

·         Not to turn this into a political discussion, but the concept of a union for professional athletes – million dollar athletes – has always struck me as wrong.  The concept of a union being in place to protect workers’ rights just does not seem appropriate when those workers are so highly paid.

·         This week – or over the next couple of weeks – fans should be rooting for the Federal Court to rule in favor of the newly decertified player’s trade association and uphold the NFLPA’s decertification.  If the players are successful in their quest to decertify, this would block a league imposed lockout and force the owners to allow the season (and offseason) to move forward.  In that case, the parties would litigate their dispute, which could take years (the 1987 strike wasn’t settled until an agreement was reached in 1993), but football would be played during that time. 

·         For those inclined to blame the owners for opting out of the prior CBA, understand that both sides had that option.  The deal was quite simply a bad deal for the NFL from the beginning and the subsequent economic downturn only made it worse.  Had the agreement turned out to be a poor agreement for the NFLPA, you can be certain that they would have been the ones to opt out.

·         If the players are successful in blocking the lockout, it would be up to the NFL to set the rules by which the league would play under in 2011.  In all likelihood, it should be expected that the NFL would re-impose the 2010 “uncapped year” rules that were anything but a boon to the players.  Under those rules, free agency was greatly reduced because players with 4 and 5 years of NFL service were Restricted Free Agents, instead of Unrestricted Free Agents.  Given that NFL teams have already tendered those players with RFA tenders, it would seem that the NFL has already tipped its hand about what rules will be imposed.

Those “uncapped year” rules also meant that, while there was no Salary Cap maximum, there was also no salary floor, so teams could spend as little as they wanted.

·         If you must pick someone – one individual – to blame for this entire mess, look no farther than former NFL Commissioner, Paul Tagliabue.  It was under Tagliabue’s watch – one of his last major acts as Commissioner – that the NFL Owners ill advisedly agreed to the 2006 CBA.  What was supposed to be the crowning achievement of Tagliabue’s reign – his lasting legacy – the deal that was largely negotiated by him, turned into an utter disaster for the NFL. 

·         Tagliabue was so intent on ensure labor piece as his final legacy, that he basically gave away the farm.  The 2005 Salary Cap was $85.5M.  Upon the implementation of the 2006 CBA, the Salary Cap immediately rose to $102M (it would have only been around $90M without the new CBA extension).  By 2009, it was $123M.  In fact, by that time, despite teams spending in an unprecedented fashion, they were still unable to even spend up to the minimum spending levels (a different calculation from the Salary Cap) as proscribed in the CBA.  This triggered the Cap Adjustment Mechanism (CAM) and added an additional $5M to the Cap.  This mechanism was in place so that if league-wide spending (actual spending, not Salary Cap calculations) dropped below prescribed levels, the Salary Cap for the following year would increase, in an effort to force that spending to be made.

So, from 2005 to 2009 – just a 5-year period – the league’s Salary Cap increased by 50%.  This unprecedented growth in the Salary Cap was the chief byproduct of Tagliabue’s “legacy” and set the stage for the present standoff.

Once considered a shoe-in, Tagliabue isn’t likely to hear from the NFL Hall of Fame selection committee any time soon.


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Brian McFarland

About Brian McFarland

Known on Ravens Message Boards as “B-more Ravor”, Brian is a life-long Baltimorean and an avid fan of the Ravens and all Baltimore sports.  A PSL holder since 1998, Brian has garnered a reputation as a cap-guru because of his strange (actually warped) desire to wade through the intricacies of the NFL’s salary cap and actually make sense of it for those of us who view it as inviting as IRS Tax Code. 
Brian, who hails from Catonsville, MD and still resides there, is married and has two children.

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