It’s easy to assume that the 2021 salary cap will go down, given the likelihood that revenues for 2020 will dip, through the loss of ticket revenues, in-stadium concession and merchandise sales, and possibly the cancellation of local sponsorships and ad buys by companies that either can’t or won’t make the investment at a time of financial uncertainty. But the reality is that the 2021 salary cap will come from one and only one thing: The negotiations between the NFL and NFL Players Association.
Even if revenues go down in 2020, the salary cap need not go down in 2021. Plenty of teams won’t want it to go down, because they won’t want to cut key players in order to get under the lowered spending limit. And the union clearly will want the cap to be as high as possible, in order to prevent a rash of players from being released and then ultimately signing new contracts, possibly for much less than they were due to make.
The ultimate number will be limited only by the creativity of the negotiators. With new TV deals on the horizon, and with those deals expected to be massive if/when a new normal arrives, the league and union could essentially borrow against future salary caps, smoothing the 2021 shortfall over multiple seasons, reducing the short-term pain for both the teams and the players.
The two sides also could tweak the formula that determines the spending minimum, giving teams that truly land in financial predicaments the flexibility to spend less for a year or two while allowing cash-rich franchises to spend to the cap. And given the ability of teams to carry over unused cap space at will, the two sides could agree that unused cap dollars definitely will be carried over — and that future spending minimums will be determined based on the sum of the current year’s cap plus the carryover amount.
The bottom line is that the league and the union will figure this out. And they have reason to figure it out. Most teams want to be able to spend money on players in order to be as competitive as possible, and the union wants to have as much money as possible available, presumably without causing any teams to go bankrupt.
No teams will go bankrupt, by the way. They’ll find a way to play 256 regular-season games and 13 postseason games, they’ll earn the TV money that goes along with it, and by 2021 things should be much better.
Besides, the teams are worth multiple billions of dollars, each. As baseball agent Scott Boras recently said, it’s hard to reconcile privatizing profits and socializing losses. That will be a relevant consideration when the time comes for the league and the union to negotiate next year’s salary cap.