The latest CBA proposals from the NHL and NHLPA suggested both sides were inching closer together, but not close enough to create a workable agreement.
I had intended on posting this much earlier today, but life plus today’s depressing press conferences (first, the NHLPA, followed by the NHL) delayed it. Better late than never.
James Mirtle of The Globe and Mail did an excellent job of breaking down the differences between the NHL and NHLPA in their latest CBA proposals.
Briefly, the NHL’s proposal was a six-year deal, in which the players get 49 percent of hockey-related revenue in Year One, 48 percent in Year Two, and 47 percent over the final four years.
The PA’s five-year proposal, as Mirtle noted, is more complex, and I refer you to his description, but as per the diagram he provides, the players propose a reduction of their share of revenue down to 54.3 percent in year one, followed by 52.7 in year two, 52.2 in year three, 52.3 in year four, and 52.4 in the final year, representing an overall percentage of 52.7.
Both proposals are based on the assumption of 7.1 percent revenue growth each season, which was the average under the current CBA.
The league reportedly weren’t seeking a salary rollback but stuck with increased escrow claw-backs as per its previous proposal. There was no intention to redefine HRR, (ensuring players a smaller share of the revenue pie before reductions were even implemented),which was a contentious part of their previous two proposals.
As Mirtle pointed out, the league didn’t like the PA’s proposal because there’s some uncertainty involved, plus the players share was still too high for the owners liking. The PA, meanwhile, didn’t like the league’s proposal because, well, what they’re seeking is more than the players want to give up.
I daresay the players also don’t like the fact the league still wants them to carry the freight for revenue sharing.
My sympathies lie with the players, and I understand their unwillingness to part with more of their share of revenue, especially after giving up so much during the previous lockout.
That being said, however, they won’t win a war of attrition with the owners. The previous lockout proved that. The owners know the fans, for all their justifiable outrage over another lockout, will return when the league opens its doors again. The fans are the owners ace in the hole.
I’m not saying the players should just capitulate, but they should accept the 50-50 split – be it a straight split each year, or a gradual reduction over the life of the deal – the league appears to be aiming for, in hopes of gaining concessions (revenue sharing, contract lengths, free agency, arbitration) which, over the long run, will work to their advantage.
While I realized the PA argues they’re already earning that much when you get into the deep number-crunching of the current revenue numbers, the fact remains the league won’t agree to the players retaining 52 percent annually over the life of the next CBA.
As for the league’s proposal, they did make a significant move from their original demand of a 24 percent reduction in players salaries to 9 percent (though the PA contends it’s actually around 17 percent), appear to have dropped the redefinition of HRR, and moved up from demanding the players accept 43 percent of HRR toward their ultimate goal of 50 percent.
But the problem with the league’s proposals is that it essentially does little to help the perennially struggling teams.
Bettman appears dismissive of the revenue-sharing issue, claiming the league and the PA are actually close dollar-wise in addressing it, and rejecting any further talk as an unnecessary distraction. He claims the issue is how much they’re paying the players.
The league’s proposals would have the increased monies from revenue-sharing come from the increased amounts clawed back from the players salaries via escrow.
Under the current CBA, escrow averaged between 8-12 percent, and in most seasons the players got their money back. This time, the league reportedly wants to increase those escrow payments between 15-20 percent, which suggests if the players are funding revenue sharing, they probably won’t get much, if any, back.
The PA believes the successful, big market clubs should carry the revenue sharing burden, which the owners of those markets are dead set against.
Having the players, rather than big-market clubs, carry the burden of revenue-sharing isn’t going to resolve the problem of the six-to-eight teams perennially losing money, most of which are located in the US Sun Belt.
In looking at what the league has been offering, it appears the owners are kicking that problem down the road for another six years, hoping it’ll be gone, or at least, not as serious, as it currently is.
Reducing the players share of revenue and rolling back their salaries under the current CBA provided some short-term relief (if you count the perennial money-losers losing less money in the early years of the current CBA “relief”), but did nothing over the long haul to improve their respective situations.
Cutting their share of revenue again without an improved system of revenue-sharing doesn’t seem like a recipe for success.
The league’s offer seems little more than a cash grab, which will benefit the big markets, perhaps a few of the mid-markets, and leave the struggling markets to fend for themselves.
That appears to be very short-sighted thinking on the owners part, but the last two lockouts proved the owners – past and present – have that tendency.
If there is any good news to glean from these proposals, it’s that they do appear to be slowly inching toward each other, and there does appear to be some room to maneuver toward a deal.
The question is, are both sides willing to work toward that deal before the current one expires by midnight Saturday?
If the respective press conferences on September 13 from the two sides are anything to go by, the answer is, no.