Salary Cap Analysis

[70Chip]

I think one point that Snyder should push in terms of revenue sharing relates to public financing of stadiums and facilities. Mr. Cooke spent about 300 million dollars on the Redskins Stadium in the nineties. Since then Mr. S has spent 100 million or more on additional improvements. P.G. County paid for some infrastucture improvements, access roads, etc. Around the same time, Denver succeeded in convincing local voters to authorize funding for their current home Invesco Field. A number of other localities (Baltimore, Cleveland) have done the same for their teams. In terms of real revenue the Redskins are actually operating a defecit as it pertains to these teams. When voters give a team a 500 million dollar stadium shouldn't that be regarded as revenue for that team and payed back to other clubs under a revenue sharing regime? Its not as though the skybox money goes back to the city or state. The team keeps that money. The team may not technically own the stadium, but they benefit from it just as though they did. This is a huge windfall.

The reality is that what the less entrepenuerial owners want is not revenue sharing but rather revenue redistribution. When its to their benefit they sing the "we have to do what's best for everyone" tune. In circumstances where they benefit from operating unilaterally, as in the example above, they seem to have a less egalitarian spirit. Update: For example, witness Art Modell on the Pete Rozelle "Spotscentury" program I just saw. Modell: "The motto with us has always been 'Think League'". (May he RIP)

While there are unique situations like New Orleans where teams face legitimate financial hardships, most teams should be creating ample revenue on their own. Is Paul Brown's name more sacred than Mr. Cooke's? Not to me. Cincinatti could sell the naming rights for at least as much as the Redskins did. They choose not to. Furthermore, we have to face the reality that N.O. may no longer be a sustainable market. Teams have moved before.

In the end any additional revenue sharing should be limited to revenue streams that all teams necessarily engage in. These might include radio, preseason ticket, preseason television, concessions, and even parking. Maybe these disincentives will have the unintended benefit of stabilizing the costs to fans. Again, an owner may say why raise prices and anger fans if I'm not getting the money? As Redskins fans that's the most we can hope for.

Finally, am I wrong in assuming that some owners are now using the possibility of an unrenewed CBA as a threat to pry concessions on revenue from other owners? I would really appreciate some instructive engagement from those of you who are so well versed in the financial aspects of all this.

[FRPLG]

Originally Posted by 70Chip

I think one point that Snyder should push in terms of revenue sharing relates to public financing of stadiums and facilities. Mr. Cooke spent about 300 million dollars on the Redskins Stadium in the nineties. Since then Mr. S has spent 100 million or more on additional improvements. P.G. County paid for some infrastucture improvements, access roads, etc. Around the same time, Denver succeeded in convincing local voters to authorize funding for their current home Invesco Field. A number of other localities (Baltimore, Cleveland) have done the same for their teams. In terms of real revenue the Redskins are actually operating a defecit as it pertains to these teams. When voters give a team a 500 million dollar stadium shouldn't that be regarded as revenue for that team and payed back to other clubs under a revenue sharing regime? Its not as though the skybox money goes back to the city or state. The team keeps that money. The team may not technically own the stadium, but they benefit from it just as though they did. This is a huge windfall.

The reality is that what the less entrepenuerial owners want is not revenue sharing but rather revenue redistribution. When its to their benefit they sing the "we have to do what's best for everyone" tune. In circumstances where they benefit from operating unilaterally, as in the example above, they seem to have a less egalitarian spirit.

While there are unique situations like New Orleans where teams face legitimate financial hardships, most teams should be creating ample revenue on their own. Is Paul Brown's name more sacred than Mr. Cooke's? Not to me. Cincinatti could sell the naming rights for at least as much as the Redskins did. They choose not to. Furthermore, we have to face the reality that N.O. may no longer be a sustainable market. Teams have moved before.

In the end any additional revenue sharing should be limited to revenue streams that all teams necessarily engage in. These might include radio, preseason ticket, preseason television, concessions, and even parking. Maybe these disincentives will have the unintended benefit of stabilizing the costs to fans. Again, an owner may say why raise prices and anger fans if I'm not getting the money? As Redskins fans that's the most we can hope for.

Finally, am I wrong in assuming that some owners are now using the possibility of an unrenewed CBA as a threat to pry concessions on revenue from other owners? I would really appreciate some instructive engagement from those of you who are so well versed in the financial aspects of all this.

Pretty good assessment from where I stand. I think you hit on some things that are real issues. I am sure Snyder has these as top of mind sticking points. The issue of communities pitching in is one I hadn't ever considered.

I do think that the more revenue challenged owners can't possibly be being the ones who are leveraging the current situation in their favor. It is far and away worse for them if the CBA goes unrenewed. Teams like the Skins will spend freely and potentially put teams like the Browns out of business or at least out of contention.

[That Guy]

Originally Posted by 70Chip

Finally, am I wrong in assuming that some owners are now using the possibility of an unrenewed CBA as a threat to pry concessions on revenue from other owners?

of course they are, otherwise it'd be signed. last i heard its the revenue sharing and not player % of profit that's really holding things up. And honestly i agree, if another team doesn't want to sell its naming rights, they shouldn't be allowed to profit from those who do... that's really close to stealing. Maybe if they made some clause that if you build your own stadium, there's less local shared revenue owed until the debt is gone and that could get smoe owners on board. Danny likes his local revenue though and wass probably in favor of killing the cba and buying up everyone until gibbs came back and the skins started winning.

some teams will benefit directly from a nuked cba, cause they're 30mill under the cap and teams like the skins wouldn't be able to restructure do to the 30% clause of player contracts in a year without a new cba. That means we'd have to release people right and left and the teams with good caps could just vacuum up cheap talent.

on another note, Gibbs is 2-0 in strike years...

[Schneed10]

Originally Posted by 70Chip

I think one point that Snyder should push in terms of revenue sharing relates to public financing of stadiums and facilities. Mr. Cooke spent about 300 million dollars on the Redskins Stadium in the nineties. Since then Mr. S has spent 100 million or more on additional improvements. P.G. County paid for some infrastucture improvements, access roads, etc. Around the same time, Denver succeeded in convincing local voters to authorize funding for their current home Invesco Field. A number of other localities (Baltimore, Cleveland) have done the same for their teams. In terms of real revenue the Redskins are actually operating a defecit as it pertains to these teams. When voters give a team a 500 million dollar stadium shouldn't that be regarded as revenue for that team and payed back to other clubs under a revenue sharing regime? Its not as though the skybox money goes back to the city or state. The team keeps that money. The team may not technically own the stadium, but they benefit from it just as though they did. This is a huge windfall.

The reality is that what the less entrepenuerial owners want is not revenue sharing but rather revenue redistribution. When its to their benefit they sing the "we have to do what's best for everyone" tune. In circumstances where they benefit from operating unilaterally, as in the example above, they seem to have a less egalitarian spirit.

While there are unique situations like New Orleans where teams face legitimate financial hardships, most teams should be creating ample revenue on their own. Is Paul Brown's name more sacred than Mr. Cooke's? Not to me. Cincinatti could sell the naming rights for at least as much as the Redskins did. They choose not to. Furthermore, we have to face the reality that N.O. may no longer be a sustainable market. Teams have moved before.

In the end any additional revenue sharing should be limited to revenue streams that all teams necessarily engage in. These might include radio, preseason ticket, preseason television, concessions, and even parking. Maybe these disincentives will have the unintended benefit of stabilizing the costs to fans. Again, an owner may say why raise prices and anger fans if I'm not getting the money? As Redskins fans that's the most we can hope for.

Finally, am I wrong in assuming that some owners are now using the possibility of an unrenewed CBA as a threat to pry concessions on revenue from other owners? I would really appreciate some instructive engagement from those of you who are so well versed in the financial aspects of all this.

I agree with your example regarding stadium naming rights and such. And I'd agree that revenue sharing should be limited to business activities common to every franchise. But that's already largely in place as it is; TV revenues make up for the largest portion of the shared revenue as it is now. The owners are certainly going to argue about stadium naming revenue and items like this, because a few extra million dollars means a lot to them. But it shouldn't mean a lot to us fans, because it doesn't have a big impact on the size of the salary cap. TV Revenues are what really drive the salary cap.

[CrazyCanuck]

Originally Posted by Schneed10

I agree with your example regarding stadium naming rights and such. And I'd agree that revenue sharing should be limited to business activities common to every franchise. But that's already largely in place as it is; TV revenues make up for the largest portion of the shared revenue as it is now. The owners are certainly going to argue about stadium naming revenue and items like this, because a few extra million dollars means a lot to them. But it shouldn't mean a lot to us fans, because it doesn't have a big impact on the size of the salary cap. TV Revenues are what really drive the salary cap.

I agree that TV revenues drive the cap and we should all be thankful that the sharing of these funds is already in place. While the amounts the owners are arguing about are substantial, they still represent a small part of the total pie. That's why I think they should be able to come up with something that most owners can accept.

The NFL is lucky because they get to negotiate one major tv deal that covers all the clubs. This is why baseball is such a mess in my opinion. The MLB TV market is so fragmented. The Yanks have YES, the Braves have TBS, the Cubs have WGN, etc. The only way to clean up baseball's mess is to merge the tv contracts under one umbrella, so the league can split the revenues evenly.

The only solution I see is to sell the entire MLB package to Fox Sports. They already broadcast the games for many different teams, and they have enough regional networks to cover all the different markets (FSE, FSNW, etc.).

Of course this is a huge pipe dream and I'm not holding my breath. People don't like to share money unless they are forced to. The greater good is of little consequence. That's another reason why the NFL is lucky - they agreed to revenue sharing when there was no revenue.

[Monksdown]

All is fair in love, war, and selling commercials on the YES network. They'll have to wait until Angelos and and Steinbrenner(?) and all of their evil seeds die.

[shallyshal]

Originally Posted by CrazyCanuck

I agree that TV revenues drive the cap and we should all be thankful that the sharing of these funds is already in place. While the amounts the owners are arguing about are substantial, they still represent a small part of the total pie. That's why I think they should be able to come up with something that most owners can accept.

The NFL is lucky because they get to negotiate one major tv deal that covers all the clubs. This is why baseball is such a mess in my opinion. The MLB TV market is so fragmented. The Yanks have YES, the Braves have TBS, the Cubs have WGN, etc. The only way to clean up baseball's mess is to merge the tv contracts under one umbrella, so the league can split the revenues evenly.

The only solution I see is to sell the entire MLB package to Fox Sports. They already broadcast the games for many different teams, and they have enough regional networks to cover all the different markets (FSE, FSNW, etc.).

Of course this is a huge pipe dream and I'm not holding my breath. People don't like to share money unless they are forced to. The greater good is of little consequence. That's another reason why the NFL is lucky - they agreed to revenue sharing when there was no revenue.

that is it for certain. you will not see snyder and jerry jones giving up money if they can help it