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Cracks ahead in NFL agreement?
Ripple effect may start soon
By Kevin Goheen
Post staff reporter
On May 6, 1993, owners and players of the National Football League entered into a new collective bargaining agreement. Labor peace has been a constant in the NFL since, making the NFL a model for other North American professional sports league either to be followed or envied.
If the league and the NFL players association don't extend the CBA by February 2007, that model will begin to crack. The current agreement runs through the 2007 season, but if no extension is signed before that February the 2007 season becomes an uncapped year for salaries.
The league hasn't operated without a salary cap since 1993 and has reaped the benefits of greater popularity and financial worth because of it.
Few people on either side of the fence expect that uncapped year to come - both players and owners have simply made too much money to let it happen - but the fact that an extension has not yet been signed will begin to affect how contracts for rookie draft choices and for veterans seeking longer-term deals are negotiated this summer.
Before the owners and players can sit down and work on that extension, however, the owners have to deal with their own internal issues, most notably the question concerning the sharing of local revenues. The higher revenue teams, clubs such as the Dallas Cowboys, New England Patriots and Washington Redskins, are balking at giving up portions of the monies they earn from their own marketing projects and stadium-related endeavors to teams that either don't or can't produce as much on the local front.
There is a concern that, like in major league baseball, a greater disparity between the "haves" and "have-nots" is growing. The salary cap, which is at $85.5 million this season, keeps teams from outspending one another - but how much money one organization can make from stadium naming rights, club and luxury box payments and local broadcast fees isn't part of the league's shared revenue pot.
"The owners' revenue sharing and the Collective Bargaining Agreement are intertwined," said Bengals president Mike Brown.
The Bengals are not among the league's higher revenue-producing teams, although since the club moved into Paul Brown Stadium in 2000 its revenue streams have increased and made the Bengals better capable of competing in the NFL marketplace. The Bengals are not among the 17 teams in the league that have sold naming rights to their stadiums.
The NFL's major moneymaker is its national TV deals.
The current NFL TV deal, valued at $17.2 billion including fees from Sunday night broadcasts on ESPN and Monday night games on ABC, ends when this upcoming season comes to a close. The NFL extended its deals with Fox and CBS through 2011 to continue broadcasting Sunday afternoon games for $8 billion. Fox is paying $4.3 billion for the rights to NFC games, while CBS is paying $3.7 billion to broadcast AFC games.
DirecTV is paying the league $3.5 billion to extend its Sunday Ticket package for five more years through 2010.
ESPN will take over Monday night football games for eight years beginning in 2006 thanks to a payment of $8.8 billion deal, while Sunday night telecasts will move to NBC, which paid $3.6 billion for a six-year deal.
All told, that's $23.9 billion worth of TV revenue for the league and its players to split up. There is a lot more money in national sponsorships and other league-wide revenue streams to divvy around to the 32 clubs. How owners ultimately decide to handle the sharing of local revenue will determine when an extension with the players union can be reached.
Under the current CBA, teams were allowed to spread the amount of signing bonuses they gave to players over as many as seven years for accounting and salary cap purposes. Through negotiated agreement, teams can only spread those bonuses for three years past the final capped season, in this case 2006. What that means for this year is that signing bonuses can only be spread out for five years.
What it doesn't mean is that players and their agents won't still be looking for monetary increases over what was paid last year.
"Your only concern (as an agent) is you want to get an increase on last year because the rookie (salary) pool went up," said agent Ken Zuckerman, whose client list includes Bengals left tackle Levi Jones. "As an agent you want the years to be less years that you can extend the player's contract out because you want to get to free agency sooner.
"I just think that from knowing the players and their perspective and the owners that it's in everyone's best interest to get something extended to keep everything fair and solid."
While the owners would be faced with an uncapped year if an extension isn't reached, it would also mean players need six years of accrued NFL experience instead of four to become an unrestricted free agent.
"I believe the fear or the weight of an uncapped year is a much bigger hammer for the union than the possible addition of two more years of restricted free agency is for the owners," said John Michels, the agent for Bengals second-round draft choice Odell Thurman. "The majority of owners would be more worried about uncapping the salary structure than the union is of the extra years it would take to become an unrestricted free agent. The whole nature of the CBA has been one of cooperation and profitability for everyone. It's been a very successful formula for both sides and I don't think anyone wants to see that end. I don't think the NFL will ever get that far."
Both Zuckerman and Michels said those players drafted high in the first round would feel the biggest impact from the lack of a CBA extension this year. That should minimize the effect on the Bengals and their dealings with Ken Kremer, agent for first-round pick linebacker David Pollack. If the issue continues unresolved into next year, however, it would be more significant to more people.
Brown said he couldn't predict when an agreement between first the owners and then between the owners and NFLPA for a CBA extension would happen but that he has full faith both will occur. That's why, he said, the club won't change its negotiating policies and goals. The Bengals signed the first of their seven draft choices on Thursday when defensive end Jonathan Fanene, the team's seventh-round pick, agreed to a three-year contract.
"We'll still sign the best deals for us," Brown said. "The way you're putting it comes with an assumption that an extension won't be reached. We don't believe that."
Michels said he has had preliminary discussions with the Bengals concerning Thurman's contract, but nothing more at this point. Most rookie contracts are finalized close to the opening of training camp, which for the Bengals is July 28 at Georgetown College.
Ripple effect may start soon
By Kevin Goheen
Post staff reporter
On May 6, 1993, owners and players of the National Football League entered into a new collective bargaining agreement. Labor peace has been a constant in the NFL since, making the NFL a model for other North American professional sports league either to be followed or envied.
If the league and the NFL players association don't extend the CBA by February 2007, that model will begin to crack. The current agreement runs through the 2007 season, but if no extension is signed before that February the 2007 season becomes an uncapped year for salaries.
The league hasn't operated without a salary cap since 1993 and has reaped the benefits of greater popularity and financial worth because of it.
Few people on either side of the fence expect that uncapped year to come - both players and owners have simply made too much money to let it happen - but the fact that an extension has not yet been signed will begin to affect how contracts for rookie draft choices and for veterans seeking longer-term deals are negotiated this summer.
Before the owners and players can sit down and work on that extension, however, the owners have to deal with their own internal issues, most notably the question concerning the sharing of local revenues. The higher revenue teams, clubs such as the Dallas Cowboys, New England Patriots and Washington Redskins, are balking at giving up portions of the monies they earn from their own marketing projects and stadium-related endeavors to teams that either don't or can't produce as much on the local front.
There is a concern that, like in major league baseball, a greater disparity between the "haves" and "have-nots" is growing. The salary cap, which is at $85.5 million this season, keeps teams from outspending one another - but how much money one organization can make from stadium naming rights, club and luxury box payments and local broadcast fees isn't part of the league's shared revenue pot.
"The owners' revenue sharing and the Collective Bargaining Agreement are intertwined," said Bengals president Mike Brown.
The Bengals are not among the league's higher revenue-producing teams, although since the club moved into Paul Brown Stadium in 2000 its revenue streams have increased and made the Bengals better capable of competing in the NFL marketplace. The Bengals are not among the 17 teams in the league that have sold naming rights to their stadiums.
The NFL's major moneymaker is its national TV deals.
The current NFL TV deal, valued at $17.2 billion including fees from Sunday night broadcasts on ESPN and Monday night games on ABC, ends when this upcoming season comes to a close. The NFL extended its deals with Fox and CBS through 2011 to continue broadcasting Sunday afternoon games for $8 billion. Fox is paying $4.3 billion for the rights to NFC games, while CBS is paying $3.7 billion to broadcast AFC games.
DirecTV is paying the league $3.5 billion to extend its Sunday Ticket package for five more years through 2010.
ESPN will take over Monday night football games for eight years beginning in 2006 thanks to a payment of $8.8 billion deal, while Sunday night telecasts will move to NBC, which paid $3.6 billion for a six-year deal.
All told, that's $23.9 billion worth of TV revenue for the league and its players to split up. There is a lot more money in national sponsorships and other league-wide revenue streams to divvy around to the 32 clubs. How owners ultimately decide to handle the sharing of local revenue will determine when an extension with the players union can be reached.
Under the current CBA, teams were allowed to spread the amount of signing bonuses they gave to players over as many as seven years for accounting and salary cap purposes. Through negotiated agreement, teams can only spread those bonuses for three years past the final capped season, in this case 2006. What that means for this year is that signing bonuses can only be spread out for five years.
What it doesn't mean is that players and their agents won't still be looking for monetary increases over what was paid last year.
"Your only concern (as an agent) is you want to get an increase on last year because the rookie (salary) pool went up," said agent Ken Zuckerman, whose client list includes Bengals left tackle Levi Jones. "As an agent you want the years to be less years that you can extend the player's contract out because you want to get to free agency sooner.
"I just think that from knowing the players and their perspective and the owners that it's in everyone's best interest to get something extended to keep everything fair and solid."
While the owners would be faced with an uncapped year if an extension isn't reached, it would also mean players need six years of accrued NFL experience instead of four to become an unrestricted free agent.
"I believe the fear or the weight of an uncapped year is a much bigger hammer for the union than the possible addition of two more years of restricted free agency is for the owners," said John Michels, the agent for Bengals second-round draft choice Odell Thurman. "The majority of owners would be more worried about uncapping the salary structure than the union is of the extra years it would take to become an unrestricted free agent. The whole nature of the CBA has been one of cooperation and profitability for everyone. It's been a very successful formula for both sides and I don't think anyone wants to see that end. I don't think the NFL will ever get that far."
Both Zuckerman and Michels said those players drafted high in the first round would feel the biggest impact from the lack of a CBA extension this year. That should minimize the effect on the Bengals and their dealings with Ken Kremer, agent for first-round pick linebacker David Pollack. If the issue continues unresolved into next year, however, it would be more significant to more people.
Brown said he couldn't predict when an agreement between first the owners and then between the owners and NFLPA for a CBA extension would happen but that he has full faith both will occur. That's why, he said, the club won't change its negotiating policies and goals. The Bengals signed the first of their seven draft choices on Thursday when defensive end Jonathan Fanene, the team's seventh-round pick, agreed to a three-year contract.
"We'll still sign the best deals for us," Brown said. "The way you're putting it comes with an assumption that an extension won't be reached. We don't believe that."
Michels said he has had preliminary discussions with the Bengals concerning Thurman's contract, but nothing more at this point. Most rookie contracts are finalized close to the opening of training camp, which for the Bengals is July 28 at Georgetown College.
And the NFL then becomes MLB and unwatchable.
to greenbay and every other "small market" team.
