Breaking Down the CBA

There is a lot of talk right now about the CBA (Collective Bargaining Agreement) between the NFLPA and the owners.  There are a lot of numbers being thrown around.  Below is an attempt to break down what some of the numbers mean.   It is very general in nature.

  • The revenue that the CBA splits between the owners and the NFLPA was an estimated $9 billion dollars in 2010.
  • The current structure calls for the players to give the owners a $1 billion dollar credit before any money is split.
  • In the current CBA deal the players get 60% of the remaining $8 billion dollars and the owners get 40% of it.

The math breaks down as follows:

  • After the $1 billion is paid the owners get another $3.2 billion dollars for a total of $4.2 billion dollars which represents 46.7% of the original $9 billion dollars.
  • After the $1 billion is paid the players get $4.8 billion dollars which is 53.3% of the original $9 billion dollars.
  • Reports are that the players have offered a 50% split of the revenue which represents a 3.3% reduction for the players, with the elimination of any credits to the owners.
  • Reports are that the owners are wanting the the players take 40% of the revenue.
  • If what is reported is true then the fundamental difference is that the owners want the players to take 13.3% less from the current CBA.

Now from an owner’s perspective:

  • 13.3% means that the owners want $1.2 billion dollars more in revenue than they get in the current CBA. (.133*9,000,000,000.00)=$1,200,000,000.00
  • That is an extra $37.5 million dollars per year to each owner. (1,200,000,000/32)=$37,500,000.00

Now from a player’s perspective:

  • There are a minimum of 1696 players in the NFLPA  (53 players*32 teams)=1696 players
  • In order to reach the owners demands (40% of the revenue for the players), the players would have to give the owners back $707,547.17 each in annual salary.  How this is paid back is anyone’s guess.  ($707,547.17/1696)=1,200,000,000.00

One last thing to consider is this:

  • The revenue only tipped to the NFLPA’s favor after it reached $6 billion dollars.  At the $6 billion dollar mark the NFLPA got $3 billion and the owners got $3 billion.  Under the current deal, the higher the revenue goes the more in the NFLPA’s favor it gets. 

There is an argument to be made on each side.  Some say the owner’s are the only ones with “skin in the game” and should be able to dictate to the players how much they will be paid.  Some say that the players should get a share of the revenue (whatever that is) because they are the people breaking their backs and without the players the owners can’t make any money.

I think, while it has to be incredibly difficult to figure it all out, that $9 billion dollars is a lot of money.  I also think that it is obvious that each side needs the other side to make any money at all.  Let’s hope they can get it resolved.

Topics: CBA, NFLPA

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