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As players sweated through their makeshift workouts on fields and facilities across the country last week, their representatives and the NFL's ownership team inched toward what both sides hoped would be a new collective bargaining agreement to end the 3½-month NFL lockout. The sides have spent recent sessions discussing revenue distribution, rookie compensation, free agency and other elements of a proposed new deal. Strangely, though, little has been mentioned about revenue sharing among the owners.
That's curious, because the issue was a major point of contention during CBA negotiations in 2006. Those talks nearly collapsed over the fears of smaller-market teams such as Buffalo, Cincinnati, Jacksonville and New Orleans that competitive balance would shift to franchises in high-earning markets like Dallas, New England, New York and Washington if a supplemental revenue sharing plan wasn't developed.
Theoretically the salary cap, introduced in 1994, was supposed to ensure that clubs would operate on a level field, but the disparity in local revenue streams from team to team affected the financial balance. That would be exacerbated in the '06 CBA, which altered the league's "total revenue" figure to include not just TV and ticket income but local income from licensing and other avenues. For instance, when a big-market club sells the naming rights to its stadium, a deal that can bring in as much as $10 million per year, it would bump up the revenue figure that determines both the salary cap and the salary floor—the minimum a team must spend in a given year. As a result, operational costs rise for the rest of the clubs. Smaller-market owners feared they wouldn't be able to compete with their bigger-revenue counterparts for players, coaches and staff.
The issue was serious enough that former NFLPA executive director Gene Upshaw wanted a supplemental revenue-sharing plan in the last deal, and ultimately owners came up with one designed to transfer roughly $100 million to $200 million from the highest-revenue teams to the lowest. Upshaw's successor, DeMaurice Smith, filed a complaint to have the program remain in effect in 2010, when there was no salary cap or floor. Curiously, though, sources say the issue hasn't come up in negotiations between owners and players. Have the former already hashed it out among themselves? Will they stick with the current plan? Or might there be a shift away from supplemental revenue sharing? Cowboys owner Jerry Jones, who has been creative and aggressive in maximizing his local revenue, has made no secret of his distaste for having to subsidize the likes of Bengals owner Mike Brown, who has not sold naming rights to the team's 11-year-old publicly financed stadium. An NFL spokesman declined to comment on the talks.
In the meantime, the focus is on what's taking place between owners and players. With the first training camp scheduled to open on July 23 in Cleveland, a deal would probably have to be reached by mid-July to start the camps on time. More negotiations were scheduled for this week. For most everyone, football can't come too soon.
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