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A New NFL is Upon Us: Questions and Answers

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With a new world of the NFL - without a salary cap -- set to begin at midnight tonight, there are many questions about how we got to this point and where we are going in this uncertain world of the NFL. Let's start to sift through the fact and fiction in answering readers' questions:

How did we get to this Uncapped Year? It seems like it just snuck up on us?

Not really, this has been in the works since soon after the ink was dry on the Collective Bargaining Agreement (CBA) negotiated in early March of 2006. Although that agreement was passed 30-2, owners quickly realized the folly of their decision.

At that time ownership desperately feared an uncapped year. Now they don't.

What is the NFL's problem with the deal?

Follow the money. The NFL says the league is getting too much. According to their numbers, of the $3.6 billion in incremental revenue since the 2006 CBA, players have received 2.6B, owners have received $1 billion and spent approximately $1.2 billion to operate their franchises. Of course, the NFL does not mention the $1 billion it takes off the top, so revenue was really $4.6 billion.

What is the NFLPA's response to that data?

Show us your books!

Why won't the NFL do so?

They believe the union has more than enough financial information without taking that step. They believe the "open books' process used in the labor disputes with the NHL and NBA did not prevent work stoppages.

Do the owners really want the players to take an 18% pay cut?

Of course not. This is a negotiation; that is their "let's throw this out there and see what happens" opening offer.

Would the average salary go down 18%?

No, the offer is based on a collective number.

Is there any chance that a deal would be done to re-institute a Cap?

Chances are slim and none, and slim is booked on the next flight out of town.

What percentage of revenues do the players now receive?

59% of TFR (Total Football Revenues, all revenue except some NFL Properties revenue and a carve-out for G-3, or stadium funding). Prior to this agreement, the players received 64% of DGR (Designated Gross Revenues) that only included gate receipts and broadcast income. The change from DGR to TFR was a giant win for the players.

What is the advantage of an Uncapped Year for NFL teams?

(1) There is no floor on spending, allowing teams to spend far less than they have.
(2) The number and quality of free agents is way down due to free agency requiring six instead of four years.
(3) Teams are not required to fund active player benefits in an Uncapped year, resulting in an average savings of 10M per team, a direct savings to ownership.

Did the NFLPA misplay this; it sounds like ownership has a lot of leverage?

DeMaurice Smith just joined the fight a year ago; he has a tough job. There is no way he could have anticipated that the poison pill to ownership of an uncapped year would be no poison pill at all.

What can the NFLPA do in the face of this?

Two things:
(1) Play goalie; just try to protect what it has as best as it can, and
(2) Insure that whatever amount of money ends up being the allocated percentage to players, it is real money, not funny money through Salary Cap accounting. This gets complicated, but having managed an NFL Cap for nine years, there are myriad ways to show a team is spending without really spending. The union needs to be on top of that.

Get ready for a new way of doing business in the NFL, starting tonight at midnight.

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