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View Full Version : NBA owners relaxed their stance on guaranteed contracts Friday



Young
06-17-2011, 09:40 PM
By Chris Sheridan
ESPN.com
http://sports.espn.go.com/nba/news/story?id=6673181


NEW YORK -- In a somewhat conciliatory gesture, NBA owners relaxed their stance on guaranteed contracts Friday during the latest round of collective bargaining negotiations to replace the labor agreement that expires at the end of this month.

The players welcomed the move but cautioned there was still a wide gulf to be bridged. The sides are still hundreds of millions of dollars apart on how to split revenues, and the owners are still asking for a hard salary cap system.

Another labor meeting is set for next Tuesday, and commissioner David Stern said the onus will be on the players to make a new economic proposal.

"The time to have an optimistic or pessimistic view is at the close of the day Tuesday. That's an important day," Stern said after the sides met for nearly five hours. "Time is running out, but both parties seem, at least to me, intent to make a deal by June 30."

The question of guaranteed contracts has been called a "blood issue" in the past by union director Billy Hunter, and the owners had earlier proposed a new system in which all contracts would contain only partial guarantees.

But that proposal was taken off the table Tuesday, with the owners agreeing to continue with the current system in which guarantees on individual contracts are a negotiable issue on a case-by-case basis.

"Every move is important, but if there is still a hard cap, it is not as significant," union attorney Jeffrey Kessler said.

Still, the day began with the sides far apart on three issues -- the split of revenues, the type of salary-cap system the league will operate under and the question of contract guarantees -- and ended with one of those items crossed off the list.

How to resolve the sides' remaining differences remains a puzzle, and the key will be the almighty dollar -- or, more specifically, the split of those dollars.

"One piece controls several hundred thousand pieces, so essentially we could put together a million-piece puzzle in a very short time if we can get two or three pieces in the right place, and that's what we're focused on doing," union president Derek Fisher said.

Owners are seeking to redefine the calculation of basketball-related income, the pile of net revenues of which the players, under the current system, are guaranteed 57 percent.

The union has offered to drop that guarantee, but it has been unable to agree with the owners on either a formula for a recalculated BRI or the percentage of those revenues that each side would get under the terms of a new deal.

"Everyone is a little frustrated," said Maurice Evans of the Washington Wizards, a member of the union's executive council. "We feel like they're trying to give us things that we already have.

"But are we committed to trying to hammer out a deal and see their perspective? Yes, we are," Evans said.

Stern said each side has presented three formal proposals plus one informal proposal, and he said the owners decided to yield on the issue of guaranteed contracts because of the significance several players placed on that issue during the course of negotiations over the past 18 months.

"I would say we're not on the same page right now, but there's some good conversations going on, and both sides are trying to come to an agreement. We'll see what happens," said Carmelo Anthony of the New York Knicks, who is not a member of the union's negotiating committee. "It was a must that I came to this meeting, just for me to sit in there in the position I'm in and with the stature I have."

Prior to the meeting, which began at noon ET at a hotel across the street from league headquarters, Hunter said the players wanted to see a more reasonable split of revenues put forth by the owners, who are proposing a 10-year agreement in which certain changes would be phased in.

The sides ended Friday's meeting still in disagreement on exactly how much of a financial sacrifice the players are being asked to make. In their early proposals, owners demanded a reduction of some $750 million to $800 million in player salaries from the $2.1 billion that players earned in the 2010-11 season. The union maintains that is still the case, whereas Stern and deputy commissioner Adam Silver contend the owners have scaled back those demands considerably.

Absent more tangible signs of progress Tuesday, the sides are expected to dig in their heels for what would be the league's first work stoppage since the summer of 1998 -- a lockout that lasted into February of 1999 before a truncated 50-game season was played.

"Nothing is agreed to until everything is agreed to," Stern said. "The clock is ticking and the runway is shortening."

Hunter indicated there is a growing belief that a group of hard-line owners are dictating the pace and tone of the negotiating process.

"The owners appear to be pretty unified in their position," Hunter told ESPN.com. "If I had to say who, I'd probably say the small markets are driving. Because if you look at the big markets -- Chicago, L.A., New York -- they're making tons of money. So it's not an issue with them, it's an issue of the smaller markets. I think that David (Stern), if he feels the climate is right within the room and there is a deal to be made, then David still has enough sway to make the deal. But I'm not sure that's an easy move on their part."

Also Friday, the league told the players that this weekend it would be canceling its Las Vegas Summer League, which would have started in early July. Silver stressed that was simply a function of the calendar, not a threat to the players.

owl
06-17-2011, 09:47 PM
"The owners appear to be pretty unified in their position," Hunter told ESPN.com. "If I had to say who, I'd probably say the small markets are driving. Because if you look at the big markets -- Chicago, L.A., New York -- they're making tons of money. So it's not an issue with them, it's an issue of the smaller markets.



That is the key to the whole agreement.

pacer4ever
06-17-2011, 09:49 PM
they said on NBA TV now the player have to comprises and lower their Basketball related income (BRI) which is at 58%


i would think they need to lower it to 45% to get a deal done and the player don't want that they also said the owners are dead set on a hard cap.

pacer4ever
06-17-2011, 09:51 PM
"The owners appear to be pretty unified in their position," Hunter told ESPN.com. "If I had to say who, I'd probably say the small markets are driving. Because if you look at the big markets -- Chicago, L.A., New York -- they're making tons of money. So it's not an issue with them, it's an issue of the smaller markets.



That is the key to the whole agreement.

I disagree Dolan the Knicks owner said that he is willing to improve revenue sharing with small market teams that shouldn't be a major issue IMO. It is more getting the players to agree to a hard cap and lowering BRI IMO.

Kegboy
06-17-2011, 10:30 PM
I think Evans called it, the owners are negotiating by giving them stuff they already have. I always felt the guarantee issue was a red herring, something they could take off the table in the name of "progress". It all comes down to the hard cap as far as the owners are concerned. They'll give on BRI, they'll give on the cap number, they'll even give on contract years, but the hard cap is a seismic change, and one they won't give up on lightly, if ever.

wintermute
06-18-2011, 07:11 AM
Another article with pretty much the same info.

http://www.nba.com/2011/news/06/17/da-labor-talks/index.html#?ls=iref:nbahpt2



Resolution in talks may come down to Tuesday's meeting
By David Aldridge, TNT analyst
Posted Jun 17 2011 10:09PM

NEW YORK -- Hopes for a resolution to an oncoming lockout that would delay, if not cancel, the 2011-12 may come down to one last meeting in New York next Tuesday between NBA owners and the National Basketball Players Assocation.

The virtual line in the sand was drawn Friday afternoon by NBA Commissioner David Stern, after a five-hour meeting between the owners and players at a downtown Manhattan hotel where Knicks forward Carmelo Anthony, not a member of the union's executive committee, made an appearance, along with Bucks swingman John Salmons and Timberwolves guard Sebastian Telfair. Hornets guard Chris Paul, a member of the executive committee, also was in attendance after missing the last couple of negotiating sessions during the Finals in Miami and Dallas.

And the meeting produced some movement on a key sticking point between the parties.
After a presentation by the union that detailed its staunch opposition to significant reductions in guaranteed contracts -- one of the owners' main contentions in previous negotiating sessions -- the league removed that plank from its current proposal to the players, in essence agreeing to return to the existing rules that allow teams to guarantee, either fully or partially, all contracts with their players.

But the league expects a signficant concession from the union next week to equal the one it believes it gave Friday.

Asked if that was the case, Stern said, "I would like one. I don't want to set expectations too high."

Stern did not specify what concession he wanted, but the notion of a hard cap that would limit total player salaries, along with an increased split for owners of Basketball Related Income (BRI) from the current 57-43 split in favor of the players are two points of emphasis for owners.

"I really think that the time to have an optimistic or pessimistic view is at the close of the day on Tuesday," Stern said. "Tuesday's a very important day in these negotiations. It's important because of the substance of our conversations today, and because time is running out. And because both parties still remain, at least to me, intent on doing the best they can to make a deal before June 30."

NBPA President Derek Fisher acknowledged that the owners had changed their position on guaranteed deals. However, a hard cap would dramatically reduce the total amount that players take home, making guaranteed deals less impactful.

"That's part of what we discussed today," Fisher said. "It was very open. A lot of owners were very opinionated, had things to state.

"We had several players that had opinions and made great comments ... guys that aren't on our committee took the time to come in and see what was going on. It was good to get in there today. There's a very clear sense of urgency. But we're not sure between now and July 1 if we can make up the gulf that exists between the two sides."

Owners still want a hard cap and a reduction in the length of player contracts. Players still want owners to do more of the heavy lifting by agreeing to enhanced revenue sharing amongst themselves to make up some of the financial shortfalls. The league claims that 22 of its 30 teams lost money last season and is asking for more than $700 million in salary givebacks from the players.

"No one's really making significant headway," said Wizards forward Mo Evans, a vice president of the union. "There are still major [proposed] changes to the system as we know it. According to them, there is no system, so we're starting from scratch. And that's hard to do in two weeks."

Deputy commissioner Adam Silver also officially announced what had long been suspected -- the NBA will cancel its popular Summer League in Las Vegas, which had participation from more than 20 teams the past few seasons and was the coming-out party for rookie stars like Blake Griffin and John Wall.

"We made it clear to the union that it was purely a function of the calendar, and drop dead dates with hotels and the arena," Silver said.

"No intent to send signals of any kind to the players. But it was an unfortunate consequence of the fact that at this late date, we still don't have a deal beginning July 1."

But at least they're still talking.

Anthony said he came to provide support as one of the league's star players -- "it was a must that I came to this meeting," he said -- and wanted to show the owners that he wanted to fight not just for current players, but to future players not yet in the NBA.

"It's a lot of dialogue going back and forth," Anthony said. "Are we on the same page right now? No. But there's a lot of good dialogue going back and forth. They talked about [guaranteed contracts]. That was a big discussion up there, a big topic up there. But we'll see what happens with that."

Stern said he would be willing to meet every day after Monday next week if there was a notion that real progress was being made. (The union has an already-scheduled meeting of its player representatives set for next week in New York.) And both sides also agreed that apparant progress in the NFL talks between owners and players doesn't impact the NBA's discussions.

"We're not as strong a business," Silver said.

"There is an important difference based upon the calendar between us and the NFL," Stern said. "If we were out as it appears that the NFL will be out, even on a best-case scenario, given the length of our season, that would take us to a place that would assure, a lot, I think, more damage. Because we have such a longer season. And I think that motivates us on both sides to see what we could do."

Almost all the members of the owners' labor relations committee -- Phoenix's Robert Sarver, San Antonio's Peter Holt, the committee chair, the Lakers' Jeanie Buss, Orlando CEO Bob Vander Weide, Oklahoma City's Clay Bennett, Portland president Larry Miller, Boston's Wyc Grousbeck, Dallas' Mark Cuban and Minnesota's Glen Taylor -- were in attendance. Cleveland's Dan Gilbert did not attend.

The union expects more of its members to attend next Tuesday's meeting.
Tuesday. That is the day that will tell the tale. A collective bargaining agreement is like a jigsaw puzzle, with a million different pieces. The NBA's owners and players have put together about eight.

They have 13 days to complete the rest.

"We haven't agreed fully on anything," Fisher said. "But ... one piece [the hard cap] controls several hundred thousand pieces. So essentially, we could put together a million-piece puzzle together in a short time if we can get two or three pieces in the right place. And that's what we're focused on doing."

wintermute
06-18-2011, 07:31 AM
I think Evans called it, the owners are negotiating by giving them stuff they already have. I always felt the guarantee issue was a red herring, something they could take off the table in the name of "progress". It all comes down to the hard cap as far as the owners are concerned. They'll give on BRI, they'll give on the cap number, they'll even give on contract years, but the hard cap is a seismic change, and one they won't give up on lightly, if ever.

I don't disagree with you often Kegboy on things CBA, but I think this is one of those rare occasions. I think the BRI split is the number one issue, followed by the hard cap. I agree though that the partial guarantees are the easiest item for the owners to give up. A pity, because I actually like that provision.

Put it this way: The BRI split is the bottomline. Every team out there, big market or small market, wants a larger slice of revenue back from the players. The hard cap just affects the distribution of revenue - some teams will be in favor, others will oppose, and there are probably some that don't care too much either way.

On Evans' assertion that the owners are just giving back to the players what they've always had. Well that's the nature of the entire negotiations isn't it? Owners on the offensive with big demands, and players basically defending the status quo.

OakMoses
06-18-2011, 09:50 AM
Doesn't it stand to reason that if the big market owners help create a system where the small markets can make money that the big markets will make even more than they do now?

Also, I think the BRI is a financial/business model issue while the hard cap is a competitive balance issue.

able
06-18-2011, 09:56 AM
I don't disagree with you often Kegboy on things CBA, but I think this is one of those rare occasions. I think the BRI split is the number one issue, followed by the hard cap. I agree though that the partial guarantees are the easiest item for the owners to give up. A pity, because I actually like that provision.

Put it this way: The BRI split is the bottomline. Every team out there, big market or small market, wants a larger slice of revenue back from the players. The hard cap just affects the distribution of revenue - some teams will be in favor, others will oppose, and there are probably some that don't care too much either way.

On Evans' assertion that the owners are just giving back to the players what they've always had. Well that's the nature of the entire negotiations isn't it? Owners on the offensive with big demands, and players basically defending the status quo.

It is not just BRI split that is the problem.
What the owners want, besides 53/47 (iow 10% drop for the players) is to take a large chunk of cost and reduce BRI first with that, after that they want the split to be as mentioned, so in essence they want to take 35% pf the players (750 million)

And Dolan saying the dont mind a better revenue share model doesn't mean LA agree to that or any of the others that make money, to them it is probably easier to take it from the players so the get even more.

able
06-18-2011, 10:04 AM
Doesn't it stand to reason that if the big market owners help create a system where the small markets can make money that the big markets will make even more than they do now?

Also, I think the BRI is a financial/business model issue while the hard cap is a competitive balance issue.

Owners feel it related, as they want to deduce the cap from the BRI (as in if bri is 70% of current after deducting the cost as they propose and the split (for easy calc) 50% that means that the cap would be 1.4 billion div by teams so roughly 45 million per team, at the most) , after they have re-invented what IS BRI.

Let's try not to forget that according to the article above, players split 2.1 billion which equals the 57% , it also leaves 1.6 billion for the owners/teams.
If they split that more reasonable then it is hard to imagine teams losing money

(that is about 55 million per team for cost not related to players)

If the players are willing to give as much back as 5% (rumours were that) then that means the teams each would get approx 7.5 million more.

If there was a hardcap as proposed avg income for team/owner would be 80 million

Pacerized
06-18-2011, 08:23 PM
The most important part of the cba to me as a fan is competitive balance. I know an equal playing field will never really happen but I'll take anything that levels the field more then it is now. A hard cap is a must, and if the cap is low enough it might be better to not have a max limit for contracts. If Lebron made 70% of a his teams cap then there would be no way that any other superstar would be willing to join him for chump change.
I hate to see the owners give up on limiting guaranteed contracts but it's not as big of an issue to competitive balance. I hope if they give up on this that a more liberal system to suspending players without pay and cutting players gets in the cba. Arenas, Tinsley, and Marbury should have been cut with ease but the cba prevented it. Cutting players based off performance is different issue but it sucks for a team like the Knicks to have to continue to pay a player like Curry when he just doesn't seem to care to get into basketball shape. I'd rather see a lockout and even lose a season then see the players get want they want.

cdash
06-18-2011, 08:28 PM
Our old pal count55 is on top of this stuff. If you follow him (@toothpicksray) on Twitter he and Larry Coon (@LarryCoon) provide some good analysis and updates on the NBA labor situation.