Blog Entry

Owners can't agree on opening books

Posted on: March 10, 2011 11:40 am
There is just one day left before a possible NFL Armageddon and a crucial event has happened within the past 24 hours.

There are some NFL owners who want to completely open the league's financial books to the union, has learned.

The problem is other NFL owners are refusing.

So the stalling in the talks has happened because one set of owners desires to open their books and others do not, a source explains. Thus ownership is stuck trying to find a way to mend these differences.

If ownership can, and the books are opened, a deal could likely be reached quite quickly.

That's where we are now. Ownership is arguing amongst itself.

Incredible, isn't it?

It's virtually impossible for ownership to reach a consensus on this issue by the Friday evening deadline so unless another extension is agreed upon, the lockout/decertification will happen then.

This is getting interesting. Right down to the wire.

Category: NFL
Tags: Labor

Since: Sep 5, 2006
Posted on: March 10, 2011 2:33 pm

Owners can't agree on opening books

jscotthubble....You claim that a football team is privately owned and therefore have no obligation to open books to the public or its employees.  Well then why are books kept in the first place.  The biggest problem with the negotiations is that the owners in the NFL have this little thing called profit shraring.  If you are going to share profits because your team is supposedley not making enough to compete than you are damb straight those numbers need to be shared.  Now to say they only have to open the books to each other and not the union is just not fair and should be illegal.  If you pay your employees based on a percentage of your earnings than you must share with them your earnings so that they know they are getting fair pay.  Its really not that hard to figure out.  If you own a team and have been hiding money from other clubs and the union of course you dont want to open your books.  If everything is legit than what do you have to hide?

And as far as the Obama dig he inherited this mess he did not create it.  Everyone scoffed at his bail out plan.  Couple of years later those that were bailed out are thriving agian but nobody want to hear about that now do they?

Since: Sep 13, 2007
Posted on: March 10, 2011 2:30 pm

Owners can't agree on opening books

mychargers - I agree with your points. I too think that straight percentages make it simpler and reduce the agrguement for opening all the books.

Since: Jun 29, 2008
Posted on: March 10, 2011 2:30 pm

Owners can't agree on opening books

I can agree with you in that aspect....but I do have one question (and I ask because I am ignorant):

"What subsidies are given to NFL franchises outside of public funded stadiums?" 

If none, then I think the argument loses some credibility, but still has merit.

Since: Sep 13, 2007
Posted on: March 10, 2011 2:26 pm

Owners can't agree on opening books

The biggest rise in Owner's expense over the last 5 years..has been player salaries.
There is a cap based on percentage of revenues on overall players salaries based on the current (old) collective baragaining unit. The rise in players salaries is indicative of corresponding rising revenues and/or that the overall compensation of players was below the maximum allowed by the CBA.

It is not unprecedented for businesses to share their books during labor negotiations. The NFL franchises enjoy anti-trust protections from the government (most industries in the US are not allowed to collude on fiscal issues). Secondly, many NFL franchises are subsidized by public monies. If the NFL is accepting public monies and receives anti-trust protection, I see no comparison with business are that truly free enterprises. Perhaps they could agree on the teams opening their books with non-disclosure agreements so that only the NFLPA and not the general public has access as a compromise.

Since: Jun 29, 2008
Posted on: March 10, 2011 2:21 pm

Owners can't agree on opening books

thanks okielou, but i guess i should have painted in a broader stroke:

in our economy "the market" determines everything....that is to say, PUBLIC DEMAND or REALIZABLE ADVERTISING PROWESS sets the such, the product (whether vital or for entertainment only) is inconsequential.  if it is a privately owned organization, there is no obligation to disclose profits - to the public, to employees or to the executive employees.

the next thing i am waiting to hear is that Obama and his Pay Czar will need to intervene and demand transparency in an effort to save everyone....he's been doing a REALLY good job at that with everything else so this will work out just great and we can have our king to thank for saving the NFL.

Since: Jan 23, 2008
Posted on: March 10, 2011 2:13 pm

Owners can't agree on opening books

Yes, the players are employees and the owners own the business. However, it IS the employees' business to know what the revenues and profits are for the following reason: The owners and players AGREED that the players should get a % of gross revenues, so that the NFL owners can do some things that would otherwise be illegal under antitrust laws (despite the existence of the UFL, the NFL, having 99.9% of the pro football business in the US, is a monopoly). These otherwise illegal activities are: restrictions on free agency, rookie draft, and salary cap.

The NFL owners currently provide an audited list of revenues to the players. If the players were getting a straight % of gross revenues, that's all they should a right to get. However, the owners also get $1 billion "off the top" before the % is applied, for costs associated with "growing the business". Now the owners claim they need $2 billion, instead of $1 billion, "off the top", claiming that profits are down, due to increased costs (i.e. stadiums) associated with "growing the business". The players are saying "prove it".

If providing or not providing financial data (beyond gross revenues) is such a big deal, I still don't understand why both sides don't try to negotiate a % of gross revenues, instead of arguing about how much should be taken "off the top" before calculating the salary cap. After all, dollars are dollars, so a smaller % of a larger number can be the same as a larger % of a smaller number.

For example, currently players are paid 60% of ($9 - $1 billion) = $4.8 billion.
The owners want to pay 60% of ($9 - 2 billion) = $4.2 billion.

Instead of taking money "off the top", requiring financial data to be provided (beyond gross revenues), you could also say that the players want $4.8/$9 billion = 53.3% gross revenues, while the owners want to pay $4.2/$9 billion = 46.7% of gross revenues. Why don't the owners and players just argue about % of gross revenues, and the idea of taking money "off the top" (along with the need for cost and profit data) would be taken off the table.

Since: Jun 29, 2008
Posted on: March 10, 2011 2:12 pm

Owners can't agree on opening books

you can't buy stock in the NFL.
the only legitimacy to your point is the Green Bay Packers, which already have opened their books.


Since: Apr 27, 2008
Posted on: March 10, 2011 1:52 pm

Owners can't agree on opening books

Opening the books? The big question. IMO..The owners should NOT have to open their books to their employees. Do you really think the players are going to look at the books and go..OMG..the Owners are losing money..or not making as much as i thought?

Each side has their own financial 'experts". Once those books are "open" the Players 'experts" will say..well..It looks like you're mismanaging your money. You're making're just not managing it properly..and then it would be the employees telling the Owners how to manage their own money.

One side can say..look ..we're losing money..the other side can say..well..if you wouldn't have overpaid here and there and mismanaged your'd have more..I don't see why I have to take a cut because you can't manage your money?

The biggest rise in Owner's expense over the last 5 years..has been player salaries.

The Packers books are open to the players..they could look at the Packers books..and they'd get a good idea of what is really happening around the league.

Since: Nov 26, 2006
Posted on: March 10, 2011 1:49 pm

Owners can't agree on opening books

I think thatboth Yogi and jscutthubble bring up good points, but Nr1. Football is not a necessary business to keep the world going. The world would survive without Football. Where as a manufacturing company, trucking trucking company, airlines and any number of other companies are necessary to keep us alive so to speak. Yes the owners do own the teams and technetally the players are employees, but there would not be any owners if there was not plaayers. You can compare players to actors or singers, they get paid for performing. Is Charlie Sheen worth 2million dollars an epicode? Not in my books, but I don't think Peyton Manning is worth the money he gets for throwing a football, but it is entertainment and that is all it is, so if the entertainers are putting money into the producers or owners pocket they have a right to know what is in the old pot to make sure they get there fair share.

Since: Mar 10, 2011
Posted on: March 10, 2011 1:49 pm

Owners can't agree on opening books

Just FYI...

All pulblicly traded companies show their profit and loss statements to the public as that information must be legally available to shareholders and the public. The teams should have to do the same as they are under the NFL corporate umbrella.

If the company is publicly traded, then its "everyones" legal business on what the company makes.

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