What is the NFL lockout really all about? It's not the trite and over-used "billionaires vs. millionaires" analogy.
It's about stadiums. Period.
Taxpayer supported stadiums, and the desire for at least 2 or 3 more of them to be built as soon as possible.
Here's a good piece by Evan Weiner about the "out of whack" world of sports, and in particular the "stadium shakedown" scheme that is going on in the NBA and NHL right now too.
Writes Weiner....
NFL owners have done a poor job of explaining the why behind their proposal of asking the players to take substantially less of the gross, from about 59 percent to 41 percent with 48 percent of that going to player salaries. The players don’t believe there is a real financial problem in the NFL after the league got new large TV deals and a bunch of new stadiums with more revenue streams coming online..The 1986 federal tax code update created the NFL labor dispute. Owners seized on a piece of the changes in the code that had major consequences.
Municipalities could build new stadiums for teams and get as little as eight cents back on every dollar generated inside the facility. Depending on the deal an owner cut with the city officials, an owner could garner as much as 92 cents of every dollar..But it is those taxpayer-funded new stadiums that have caused the problem. With every new stadium that has opened or has been renovated, more revenue does flow into the league — which raises not only the salary cap ceiling but also hikes the salary cap floor..
The 1986 tax code revision was a double-edged sword. For some owners (like Art Modell) it was a lifesaver, while for others (like those in Minnesota), it has been a disaster..Franchises playing in old facilities like the Oakland Raiders, the San Diego Chargers, the San Francisco 49ers, the Atlanta Falcons, the St. Louis Rams, the Minnesota Vikings and others cannot keep pace and are struggling to meet the salary cap floor. Additionally some owners have thrown a lot of money into new stadiums and have to pay down the stadium debt..The 49ers owners, the York family, have not gone full throttle in getting financing for a proposed stadium in Santa Clara as of yet. The league wanted to show the players they need to contribute money for the Santa Clara facility.
REACT: The stadium dynamic that drives league-wide profits, and in particular, owner specific profits, is really the ballgame. Teams that don't have new, modern, ATM-like stadiums built (at least partially) on the public dime, are fighting like hell to get them, or threatening to leave (often unconvincingly).
Other owners who bit the bullet and built Taj Mahal's on heavy doses of private debt (read: their own money) are desperate to steal back as much cash from the players as possible in this fight. They simply can't afford to "lose" this time around, so you understand why guys like Jerry Jones comes swaggering in banging his fists together and threatening to "show you" how serious the owners are.
It's about stadiums. Period.
Taxpayer supported stadiums, and the desire for at least 2 or 3 more of them to be built as soon as possible.
Here's a good piece by Evan Weiner about the "out of whack" world of sports, and in particular the "stadium shakedown" scheme that is going on in the NBA and NHL right now too.
Writes Weiner....
NFL owners have done a poor job of explaining the why behind their proposal of asking the players to take substantially less of the gross, from about 59 percent to 41 percent with 48 percent of that going to player salaries. The players don’t believe there is a real financial problem in the NFL after the league got new large TV deals and a bunch of new stadiums with more revenue streams coming online..The 1986 federal tax code update created the NFL labor dispute. Owners seized on a piece of the changes in the code that had major consequences.
Municipalities could build new stadiums for teams and get as little as eight cents back on every dollar generated inside the facility. Depending on the deal an owner cut with the city officials, an owner could garner as much as 92 cents of every dollar..But it is those taxpayer-funded new stadiums that have caused the problem. With every new stadium that has opened or has been renovated, more revenue does flow into the league — which raises not only the salary cap ceiling but also hikes the salary cap floor..
The 1986 tax code revision was a double-edged sword. For some owners (like Art Modell) it was a lifesaver, while for others (like those in Minnesota), it has been a disaster..Franchises playing in old facilities like the Oakland Raiders, the San Diego Chargers, the San Francisco 49ers, the Atlanta Falcons, the St. Louis Rams, the Minnesota Vikings and others cannot keep pace and are struggling to meet the salary cap floor. Additionally some owners have thrown a lot of money into new stadiums and have to pay down the stadium debt..The 49ers owners, the York family, have not gone full throttle in getting financing for a proposed stadium in Santa Clara as of yet. The league wanted to show the players they need to contribute money for the Santa Clara facility.
REACT: The stadium dynamic that drives league-wide profits, and in particular, owner specific profits, is really the ballgame. Teams that don't have new, modern, ATM-like stadiums built (at least partially) on the public dime, are fighting like hell to get them, or threatening to leave (often unconvincingly).
Other owners who bit the bullet and built Taj Mahal's on heavy doses of private debt (read: their own money) are desperate to steal back as much cash from the players as possible in this fight. They simply can't afford to "lose" this time around, so you understand why guys like Jerry Jones comes swaggering in banging his fists together and threatening to "show you" how serious the owners are.
I thought the point of the bigger stadiums was to make more money. It the stadiums are driving the owners into more debt, and the additional cash flow can't handle it, than why bother putting up the stadium in the first place?
ReplyDeleteRemember when new Yankee Stadium opened up and people were shocked that it wasn't one continual sell-out after another? How can people be shocked that stadiums with $1000+ face value tickets aren't selling out. For the cost of taking a family of four to Yankee Stadium sitting in box seats I can take them to Europe for two weeks. I'm guessing more people are finding that decision a bit ludicrous.
ReplyDeleteschome - You missed Czabe's point. It's not the people with the new stadiums that are having the problem (although they would like help with paying the debt) it's the people with the old stadiums and the rising salary floors that are the real problems. This puts both the owners with the new stadiums and the old stadiums on the same side of the issue.
ReplyDeleteEdge,
ReplyDeleteThe problem is the evidence the reporter uses to support his argument. Atlanta, St Louis and Oakland all have new stadiums (or in Oaklands case moving to an old stadium) years after the 1986 tax deal. So how a tax deal that some teams took advantage of the code and others didn't. That is the vault of the teams not being more forceful in getting new stadiums.
Second, I seriously doubt Czabe would have any problems if Sony was trying to squeeze its employees to get better tvs for his man cave, he is on the players side on this one because he has a vested interest in watching football.
To quote one of my favorite lines from the guys' on air discussions: "It's a scam!"
ReplyDeleteI live here in Indy Czabe, and let me tell ya, the Colts and Jim Irsay pulled off one of the great bend over and take it routines on local taxpayers that has ever been seen.
By the time all was said and done with the construction of Lucas Oil Stadium, not only did the Colts not spend any cabbage, they actually made money with naming rights kickbacks etc...
Plus, they use the facility rent free, and take a 50% cut on ticket and concession sales on all the other non-NFL events at the stadium...makes doing business with Tony Soprano seem reasonable.
Jim Irsay: Indiana's wealthiest squatter!
Edge - Yes, Czabe's post does does point out how owners with older stadiums are having problems meeting the salary floors. But the post also points out how owners with new stadiums are hurting:
ReplyDelete"Additionally some owners have thrown a lot of money into new stadiums and have to pay down the stadium debt.."
"Other owners who bit the bullet and built Taj Mahal's on heavy doses of private debt (read: their own money) are desperate to steal back as much cash from the players as possible in this fight. They simply can't afford to 'lose' this time around"