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League publishes Q&A on television contracts case

We don’t take Saturdays off.  And neither does the ongoing labor baby mama drama between the NFL and the players’ union.

The NFL has posted at its labor-centric website, NFLLabor.com, a set of questions and answers regarding the Special Master proceeding recently filed by the NFLPA, which attacks the league’s  newest round of television contracts, which reportedly provide ongoing payments to the teams in the event of a work stoppage.

The union calls the provisions “lockout insurance,” and for good reason.  By ensuring that the money will continue to flow from CBS, FOX, NBC, ESPN, and DirecTV, men like Cowboys owner Jerry Jones will be able to service the massive debt that comes from building a $1.1 billion stadium.  (And, as always, nothing we say here regarding the issue reflects the opinions or beliefs of our network partner, NBC.)

This necessarily gives the league more leverage against the players, since it gives the league a much larger war chest during any work stoppage.  While, as the league acknowledges, the money from the networks would have to be repaid with interest, the fact that the deals run through 2013 means that, as a practical matter, any repayment obligation easily could be tied up in the next round of broadcast-rights deals, making a true dollar-for-dollar repayment unlikely.

The league’s Q&A also glosses over the union’s strongest point.  Every term in a contract of this nature has value.  Though the league did a great job of growing once again the total revenue, even more money could have been generated, if the league had not insisted on ongoing payments during a work stoppage.

Put simply, that term has a tangible value.  And that value could have been converted into more money shared by the teams and the players.

The Q&A also contains a bit of news.  “The NFLPA filed this proceeding without even reviewing the contracts
that they are challenging,” the league says.  “The NFL repeatedly offered those contracts
to the NFLPA’s lawyers for their review, but the NFLPA refused to agree
to standard confidentiality guarantees for those proprietary documents.
As a result, many of their allegations are speculative and inaccurate.”

The union surely will get the contracts within the confines of the Special Master proceeding, and both sides surely will continue to disagree regarding what the contracts say, what the contracts mean, and whether the league could have and/or should have obtained more money to be shared with the players now in lieu of the ability to generate enough money during a work stoppage to make payments on debts arising from owning a team and/or building a stadium.

And this could end up being a key battle in the broader war.  If the union wins this one, it will be much harder for the owners to pay their bills without football being played.

Indeed, victory could prompt the union to quit worrying about a lockout — and to start thinking about a strike.

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11 Responses to “League publishes Q&A on television contracts case”
  1. Fire Ted says: Jun 19, 2010 12:20 PM

    Smith must be connected to Barry Obama as some suggest because he is doing to the union what BO did to the unwashed masses…convinced them of something that didn’t exist and its up to them to stick it to “the man” and by doing so, destroy everything. Thank God for the NCAA, at least we know they aren’t crooked too….(cough, cough)

  2. See Deb's lips move when Ben farts says: Jun 19, 2010 1:52 PM

    @FireTed:
    Indeed. De Smith contributed to the Obama campaign, considers him a friend, and also worked on the Obama transition team:
    http://change.gov/agencyreviewteams (scroll down a bit, he’s listed under “Justice and Civil Rights Team”)

  3. NFLMMAfan says: Jun 19, 2010 1:57 PM

    I didn’t come back after the MLB players stuck thereby cancelling the World Series.
    After the JaMarcus and Fat Ablert episodes, I have ZERO sympathy for the Player’s Union.
    Strike and I’ll find another sport to put my money into. MMA rocks!

  4. naskar says: Jun 19, 2010 2:04 PM

    florio, what’s your deal with the constant anti-cowboys bias? you always single out jerry jones and his $1.2B stadium like he committed a crime, the taxpayers of arlington provided $325M + $150M from the nfl and jones picked up the rest of the tab…why wouldn’t jones, among other owners including bob kraft, john mara, the rooney’s, bob mcnair, bill bidwell, etc make sure that they’ll receive payments from the networks in the event of a work stoppage to ensure that they can service the debt on their stadiums, it’s a shrewd business maneuver and if the networks are willing to agree to this, so be it…

  5. edgy1957 says: Jun 19, 2010 3:01 PM

    # naskar says:
    rooney’s, bob mcnair, bill bidwell, etc make sure that they’ll receive payments from the networks in the event of a work stoppage to ensure that they can
    ************************
    You did see what Jones got from his PSL and other activities and somehow, you seem to be under the impression that he’s servicing a debt on that stadium. Man, are you guys brainwashed.

  6. naskar says: Jun 19, 2010 4:48 PM

    @edgy1957 says:
    You did see what Jones got from his PSL and other activities and somehow, you seem to be under the impression that he’s servicing a debt on that stadium. Man, are you guys brainwashed.
    *****************************************
    yo dude, every stadium in the league sells psl’s…i’m not brainwashed, but apparently i’m a little brighter than you because i understand that every team sells psl’s, but said sales do not generate nearly enough revenue to pay off the massive debt incurred with the construction of these new stadiums, hence, these owners including jones, kraft, mcnair and so on do have to service their debts…by the way, servicing a debt means they are making installment payments on the outstanding principle owed, think mortgage payment…

  7. hawk22314 says: Jun 19, 2010 4:54 PM

    Florio, why criticize the owners for having the foresight to protect thenselves? This is a smart move that should be lauded.

  8. SecondBestDad says: Jun 19, 2010 7:36 PM

    hawks22314
    Florio is hugely anti-owner and pro-player. He proves it again and again and again with his writing. You just have to accept it and read his words by filtering out all the opinion nonsense and gleaning the facts.
    Accept this site for what it is, one that provides no value beyond aggregating content from a bunch of different sites so we don’t have to search for it. But don’t expect Florio to provide any sort of unbiased analysis. That’s like expecting me to hit a curveball, it just ain’t happening…

  9. edgy1957 says: Jun 19, 2010 8:05 PM

    # naskar says: June 19, 2010 4:48 PM
    yo dude, every stadium in the league sells psl’s…i’m not brainwashed, but apparently i’m a little brighter than you because i understand that every team sells psl’s, but said sales do not generate nearly enough revenue to pay off the massive debt incurred with the construction of these new stadiums, hence, these owners including jones, kraft, mcnair and so on do have to service their debts…by the way, servicing a debt means they are making installment payments on the outstanding principle owed, think mortgage payment…
    *************************
    Sigh.
    Look, before Jerry even paid a single penny, Arlington had over $280 million of the $325 million that they had pledged and they used it to buy up the land, demolish the area and start the building and then the NFL kicked in $150 mil. By the time that Jones had to pony up for what was supposed to be his half of a $650 million stadium, he had inflated the cost but still had $475 mil that was paying off his debt until he sold his part of the PSL that he needed to take care of the cost. Jones will make more than $200 million off the PSL that doesn’t cover his portion of the stadium. He also made AT LEAST $20 million per GAME last year just in ticket sales and he OWNS the concession company with Steinbrenner and NONE of that money is going back to Arlington. He will pay them roughly $2.5 million in rent for the next 30 years but since he’s making over $202 million JUST IN TICKET SALES, what does he care about that pittance of rent. He has hosted several HIGH DOLLAR events that no one gets money but Jerry and if he’s actually paying someone then he’s gotta be doing it for tax purposes because he got more than enough money from the PSL to pay off his portion of the stadium.
    As for the others, MOST of owners of recently built stadiums have paid less than half of the cost and some have paid nothing to 25%. There are exceptions like NE but even the ones that “paid” more than half used some form of a PSL to finance their portion of the stadium. When you consider that if a team had 160 luxury boxes and if they rented them at a minimum of $50,000 per year (a very low price. The Eagles charge a MINIMUM of $75,000 for any one of their 172 luxury boxes), that brings in $8 mil per year. When you consider the kind of money that these guys brought in with their PSLs and the pittance that many of them paid as their portion and what they’re getting for luxury boxes, it’s laughable to think that they’re servicing a lot of debt. The only real debt that any of them have comes from giving a portion of their visitor’s share to pay back the $150 mil that they got from the NFL stadium fund.

  10. hotchick says: Jun 19, 2010 9:49 PM

    Sigh…..
    People actually think they know where every penny an NFL gets comes from and where every penny goes.
    And they think the cities that help pay for stadiums get nothng in return. You think Arlington built the place for Sh!ts and giggles?
    Oh and every staduim does not sell PSL’s.

  11. edgy1957 says: Jun 19, 2010 11:21 PM

    # hotchick says: June 19, 2010 9:49 PM
    Sigh…..
    People actually think they know where every penny an NFL gets comes from and where every penny goes.
    ********************
    I know more than YOU do…..’nuff said: http://boards.edgy-sports.com/viewtopic.php?f=2&t=2456
    Pretty much. The Cowboys have all the prime events, they pay 2.5 million to the city and $500,000 of it goes to a youth program AND the city collects — wait for it – NO TAX FROM THE COWBOYS because of their deal. Yeah, Arlington is really getting their money’s worth. Apparently, they did get use of a luxury box but that has become a political hot potato in the city AND the state.
    I didn’t say that they did but someone else did. HOWEVER, all the recent stadiums WERE built with a PSL or something that they might have called NOT a PSL but if it walks like a PSL….

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