NFL Owners Considers Cancelling Agreement

In March of 2006, the NFL reached an agreement with the NFL Players Association (NFLPA) by a vote of 30-2. It was essentially a take-it-or-leave-it offer from the NFLPA, after watching the owners wrangle amongst themselves over revenues. In the end, the deal was that the collective bargaining agreement - with a salary cap - would be extended and the league would distribute 60% of the qualified revenues. This radically shifted the economics of the league.

At the time, it was reported that the deal was eventually put together by 9 teams - led by the Patriots and Cowboys - and was designed to ensure 6 more years of labor harmony.

As a result of the deal, the salary cap increased and the owners guaranteed that there would continue to be a salary cap.

However, what was not reported at the time was that the agreement contained a provision allowing either party to the agreement to terminate the extension in November 2008 and the reports are that several owners have suggested the extension needs to be renegotiated.

There was wide debate within the ownership ranks about the amount of money the league was revenue sharing with the players association, but in the end decided that the cost certainty of a salary cap was a more important business issue. The agreement added approximately $900 Million to the deal for the players, but concerns about some owners becoming "cash strapped."

Should either the NFL or the NFLPA terminate the deal, 2009 would be the final year with a salary cap; 2010 would be an uncapped year and the collective bargaining agreement would expire in 2011. The union has specifically stated that should there come a point with an uncapped year, the union would never agree to another and that should the agreement be cancelled the players would not settle for less than the 60% of revenues they have currently.