Hockey-related revenue focus of latest CBA session
TORONTO -- National Hockey League Commissioner Gary Bettman said Thursday that the distribution of hockey-related revenue is the most important facet of the ongoing negotiations toward a new Collective Bargaining Agreement.
After a two-hour session between negotiating teams from the League and the National Hockey League Players' Association at the Union office, Bettman said there is a wide gap that exists between the two sides' respective views of the percentages of hockey-related revenue (HRR) each should receive.
"Whether or not we're talking about these contract or system issues, or if we're talking about revenue sharing, it's clear that we're at a point that it's going to be very difficult to move this process along until we deal with the fundamental economic issues," Commissioner Bettman said. "Certainly as it relates to the fundamental economic issue we are far apart both in terms of magnitude and structure. That is something we're trying to get a handle on."
Commissioner Bettman, NHL Deputy Commissioner Bill Daly, NHLPA Executive Director Donald Fehr and NHLPA Special Counsel Steve Fehr will reconvene in a small-group meeting Tuesday in New York City to work further on resolving the fundamental economic issues of the negotiations.
The current CBA expires Sept. 15.
Donald Fehr said the Union is not of the opinion that the HRR portion of the economic issue needs to be resolved before the sides tackle how much revenue sharing will go into the new CBA and what rules governing player contracts will be included.
"Our belief is that, and I think they share what I'm about to say, even if we come at it from different perspectives, is that when you tie together the core economic issues in terms of the [salary]-cap numbers, when you add to that the revenue-sharing issues, when you add to that the player-contracting issues, we don't separate them and we have different approaches as to what makes sense and what needs to be tackled first," Fehr said. "Having said that, they all have to be agreed upon or it's not going to be agreed upon, so when we say we're going to focus on core economic issues next week, I expect that sooner or later we'll get to all of those. Exactly what is going to come up first I don't know yet."
Fehr also said the Union finished making its initial proposal presentation Thursday with the addition of its formal views on various player-contract issues.
The Union made the first part of its economic proposal on Aug. 15, a proposal that included what it described as a more comprehensive revenue-sharing program.
Commissioner Bettman said Thursday that he does not believe that revenue sharing is a major stumbling block between the two sides, arguing that the League's proposal reflected changes to the current revenue-sharing system.
"I know there is a lot of finger pointing to revenue sharing, which I don't understand," Commissioner Bettman said. "By any measure, in comparison to other leagues, on any basis, we've had significant revenue sharing. Our initial proposal offered to increase revenue sharing in terms of the magnitude of the pool and the parties, the clubs that are included. We're not that far apart.
"I think they proposed a $240 million pool; we're (proposing) a $190 million pool. That's not a real issue from our standpoint. We are prepared to revenue share. I'm not sure why there is a fixation on it. There is no internal dispute on it from the League's standpoint."
In the original proposal submitted by the owners six weeks ago, a reduction in the players' share of HRR from 57 percent to 46 percent was introduced.
The Union proposed last week a system that would de-link hockey-related revenue from the salary cap and cap the annual increases of the players' share to fixed rates across the next three seasons. Under that proposal, the players' total-dollars share would grow by 2 percent in 2012-13, 4 percent in 2013-14 and 6 percent in 2014-15. The Union's proposal included an option for the players' share of HRR to return to 57 percent for the 2015-16 season.
Commissioner Bettman said the owners' belief is that they are paying too much in player salaries. He said the average player salary has grown by $1 million during the past seven years, from $1.45 million in 2005-06 to $2.45 million in 2011-12.
"The players have done very well under this deal," Commissioner Bettman said. "They've said publicly they'd be happy to keep playing under this deal even while we negotiate. While we were prepared to begin negotiating a year ago, the Union said it wasn't ready until the end of June. So, you can't negotiate with yourself, and my sense is that they prefer to keep things the way they are, and so that slows up the process."
Fehr said the players are already receiving less than fair market value because of the salary cap.
Both sides said Thursday they would use the four-day break in negotiating sessions to prepare for a discussion on hockey-related revenues in the small-group session on Tuesday.