BaumerJet Posted March 24, 2008 Share Posted March 24, 2008 A better explanation of who really wants us to charge for PSL's and why! This Week's News Court filing: NFL carrying $9B of debt By DANIEL KAPLAN Staff writer Published March 17, 2008 The NFL, through the league and its 32 teams, has more than $9 billion of debt. The figure, which has never before been public, is disclosed in a letter that the league’s outside general counsel, Gregg Levy, wrote last October to the NFL Players Association in response to the union’s questions about a league resolution to reduce team debt. The letter earlier this month was included as an exhibit in a court filing. “The Resolution reflects general leaguewide concerns about the financial health of the league, and in particular about the level of league and club debt, in an uncertain economic environment, especially one in which its clubs are operating with very thin margins,” wrote Levy, a partner with Covington & Burling. “(The League office estimates debt levels under current League policies to be above $9 billion.)” The NFL debt figure is far higher than that of other leagues. MLB clubs owe $3.1 billion, according to MLB CFO Jonathan Mariner, though that number does not include the roughly $2 billion in financing for the two pending New York ballparks because that debt, technically, is not carried by the teams. The NBA declined to make public its debt total, but the league’s policies limit all team borrowings to $175 million per club. The NHL also declined to discuss any aspect of its debt, but finance sources have previously said that the league allows teams to carry debt up to half of their franchise value. “It is a very significant figure,” said Marc Ganis, a sports consultant with ties to several league teams, of the NFL figure. “I would estimate half is related to stadium debt.” About 25 percent of NFL debt is tied to stadium projects in Dallas (above) and New York. While the $9 billion figure may seem high, the NFLPA’s outside counsel, Jeffrey Kessler, said he is not concerned by it because league cash flows can support the costs. He declined to say how much league cash flows are. League revenue in 2006 was $6.97 billion, the union said in a collusion complaint made to Special Master Stephen Burbank, and NFLPA Executive Director Gene Upshaw, in announcing that case, said league revenue was expected to rise to $9 billion. The NFL’s debt load has become a bone of contention with the union, which last month filed the collusion complaint against the league because of the debt reduction plan. In his Oct. 31, 2007, letter, Levy wrote to Kessler that the debt reduction resolution addressed concerns by the league about steep borrowings and general credit conditions. The letter was contained as an exhibit in the union’s March 7 response to the league’s effort to remove Judge David Doty from oversight of the collective-bargaining agreement. The league, in a complaint filed earlier this year in his court, the U.S. District Court, District of Minnesota, charged that Doty is biased against management. Both sides have been making aggressive moves in anticipation of the owners opting out of the CBA. Since signing the deal in March 2006, owners have decried it as too player-friendly. In addition to seeking the removal of Doty from the CBA matter, the league has asked that all federal court supervision of the CBA be removed and has hired Proskauer Rose attorney Bob Batterman as a labor adviser. Batterman is well-known for steering the NHL through its lockout in 2004-05. The NFLPA, meanwhile, has filed the collusion case and is preparing its players for a possible lockout in 2011. If the owners opt out this year, the 2010 season would become the last year of the deal and contain no salary cap. The NFL debt figure likely includes all team borrowings and the league’s G-3 stadium funding plan, which has granted nearly $1.4 billion to 11 stadium projects since 1999, and might include the league’s lending pool, or credit facility. The NFL did not respond to requests for comment. Another factor in the debt figure is that a select few projects eat up a large chunk of the amount. The New York Jets and Giants borrowed $1.3 billion for their new stadium and received $300 million from the G-3 program. The Dallas Cowboys borrowed $475 million for their new stadium and got $76.5 million from G-3. That totals nearly one-quarter of the league’s entire debt burden. In addition to the plan to reduce team debt caps from $150 million to $120 million by 2010, the NFL wants to reduce overall debt by $1 billion in that period. Link to comment Share on other sites More sharing options...
BwanaZulia Posted March 24, 2008 Share Posted March 24, 2008 Not sure this sheds any light on the Jets/Giants PSL plans. BZ Link to comment Share on other sites More sharing options...
joiseyjet Posted March 25, 2008 Share Posted March 25, 2008 A better explanation of who really wants us to charge for PSL's and why! OK so since I`ve already posted about 10 different times eac on the multiple JETsites that the money is already there to pay for this whole thing before they charge us $1,now they have to come up with a new excuse ,and your telling me there new excuse is the NFL is 9 billion in debt because their paying starters 10 million a year and now guaranteeing rediculas amounts of money even if the guy only plays a whole season and the NFL`s way of paying this debt offf is to bang the avg. guy who`s making between $20,000 - $60,000 a year instead of putting a tax on signing bonus` & guarantted cash ,the higher the amount the larger the tax ,if thats whats putting us really in debt that should be paying it off ,not the avg. joe not the whole thing anyway Link to comment Share on other sites More sharing options...
Recommended Posts
Archived
This topic is now archived and is closed to further replies.