Financial tweak

[bschr682]

Recent threads got me looking at the financial aspect of the league again. We did just have an owner quit, in my opinion, because essentially his team is dead ended. You have to admit that when Las Vegas can sign Mike Swanson to what was an absolute absurd contract extension, then release when he lumped and have ZERO tangible negative effect (i.e. still flush with cash, didn't bat an eye to cutting that kind of money) that maybe, just maybe there is a tiny bit of a problem. Just one example.

We have a 110 million salary cap and somehow Huntsville gets 83 million a year in just media revenue alone. That's odd.

Madison's confidence that the amount of money he gave Salazar isn't a mistake is another example. That should be a crippling amount of money to give out. No one in their right mind should do that but we can get away with that now.

And not just to call out others. I am totally guilty of this myself. You should see the offers that I just threw out in free agency because I can totally get away with it.

We do seem to have a bit of a have's versus have not's thing going on.

All that said, maybe its not really a huge problem because of the OOTPPLAYOFFRANDOMIZER striking every year but its something to keep in mind I think. At the very least I think the league is still far too cash flush.

[trmmilwwi]

yes, but nothing will be done about it. carry on.

[recte44]

Um, the Huntsville thing was fixed.

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[Cliche]

I mean... if a team wants to pay a guy 60 million that's on them. We have a salary cap already and a budget top-end. If Salazar lumps into a pile of dust it's going to hurt. But if Madison signed him at the exact right time in their cycle of player spending... meh. That seems like good management to me. I mean they won 55 games last year. It's not as though they're going to be able to keep paying him that much when the team is any good.

Star player salaries are WAY UP in the more recent versions of the game, and will only continue to rise if there's a lot of money out there league wide. Maybe you have unlimited resources to throw at free agents, but I sure don't as a team that is trying to keep a title contender together. I've had to move on from countless players because of revenue and cap concerns. I finally put some money into stadium funds in the last few years, after sitting at zero or in the negative for basically 10+ seasons. I had to scrape to pay stadium fees in many a year.

As a team that has been pretty good the last five years can I cut a player and not end up in financial peril? Maybe, depending on the contract. But I had to build up that buffer in order to be able to do that and still field a competitive team. I've had to find a way to get decaying stars off my roster in the past and there was no way I could just cut them. I ended up having to give up prospects to dump a contract more than once. I can't afford to just sign whomever I want. There's already competitive balance being enforced.

I guess I don't see a big deal with teams being able to get out of a bad contract or sign a big free agent deal without crippling the franchise. Particularly if those teams have generally been fiscally sound.

As for the league being cash flush... okay, it seems like the majority of teams are sitting at the cash max. So maybe that's an issue worth looking into further. But adjusting broadcast revenue downward is only going to escalate the "haves vs have nots" scenario you are painting. There's a much bigger disparity in attendance revenue than there is in media money. Heck my team relies on that broadcast money and walk up ticket sales, because our season ticket numbers are pretty low for a good team.

[indiansfan]

I know building the new stadium really boosted my $ due to the interest and loyalty bumps. Looks like some of the big $ teams either are in new stadiums, are winning big or both

[agrudez]

What does cash flow matter if you're delimited by a salary cap? You can trade it, I guess - not sure what straight cash is worth as trade value as one hasn't been done in awhile that I can recall. You can sign IFAs - which is probably the biggest consideration, but the classes haven't been very good for awhile and you're still bound by the every other year stipulation. You can "buy-out" bad contracts - sure, but even then only the last few years because no one is making *that* much money... even HSV (max fan loyalty, max market size, 95 fan interest, a relatively large stadium and large ticket prices) only projects for about 30M profit while operating at the 110M salary cap (after the media revenue got put back down from 80M+... PS. I'm the only one that got moved down... now Calgary is making 13M more than me, lol). Even if you think this is a game breaking issue, what is the solution? Anything not arbitrary (ie. Matt going in and manually adjusting certain teams) would have trickle down effects on others - many of whom are already getting screwed.

For reference, teams at the bottom are still getting squeezed pretty damn hard by the cap relative to their budget. Havana already had to make a really tough choice with Eisenhower because they are forced to operate 20M under 2/3rds of the league. Now teams like DM (who actually turned a profit last year - how does their budget go *down* after turning a profit?) and YS (only a small loss) are even worse - having to operate at 30M+ under the rest of the league. If they want to compete now they can't - not on an equal playing field, anyway. The bigger problem, though, is when their young guys start looking for arb and beyond. I can easily imagine rebuilding potentially being forced into a perpetual loop of constantly trading their prospects after they hit 6 years of service time due to budget constraints and never being able to actually get a real window open.

The solution, imo, is allowing everyone to spend up to the salary cap (ie. turning budgets off). How is YS ever going to get competitive enough to earn more money when OMA and HSV can have the equivalent of 3 extra all-stars (10M/year salaries)? Sure, that would create some teams accruing debt faster on occasion (ie. if they spend more and don't translate that to wins), but we can have some sufficient checks and balances in the rule to keep teams from not considering finances at all (something like 2 seasons of 10M+ losses and *then* impose a stricter cap on them - at least it gives owners flexibility in the short term to try and pull themselves up by their boot straps when they need - or, more importantly, not lose building blocks due to an unfair system).

[bschr682]

What does cash flow matter if you're delimited by a salary cap? You can trade it, I guess - not sure what straight cash is worth as trade value as one hasn't been done in awhile that I can recall. You can sign IFAs - which is probably the biggest consideration, but the classes haven't been very good for awhile and you're still bound by the every other year stipulation. You can "buy-out" bad contracts - sure, but even then only the last few years because no one is making *that* much money... even HSV (max fan loyalty, max market size, 95 fan interest, a relatively large stadium and large ticket prices) only projects for about 30M profit while operating at the 110M salary cap (after the media revenue got put back down from 80M+... PS. I'm the only one that got moved down... now Calgary is making 13M more than me, lol). Even if you think this is a game breaking issue, what is the solution? Anything not arbitrary (ie. Matt going in and manually adjusting certain teams) would have trickle down effects on others - many of whom are already getting screwed.

For reference, teams at the bottom are still getting squeezed pretty damn hard by the cap relative to their budget. Havana already had to make a really tough choice with Eisenhower because they are forced to operate 20M under 2/3rds of the league. Now teams like DM (who actually turned a profit last year - how does their budget go *down* after turning a profit?) and YS (only a small loss) are even worse - having to operate at 30M+ under the rest of the league. If they want to compete now they can't - not on an equal playing field, anyway. The bigger problem, though, is when their young guys start looking for arb and beyond. I can easily imagine rebuilding potentially being forced into a perpetual loop of constantly trading their prospects after they hit 6 years of service time due to budget constraints and never being able to actually get a real window open.

The solution, imo, is allowing everyone to spend up to the salary cap (ie. turning budgets off). How is YS ever going to get competitive enough to earn more money when OMA and HSV can have the equivalent of 3 extra all-stars (10M/year salaries)? Sure, that would create some teams accruing debt faster on occasion (ie. if they spend more and don't translate that to wins), but we can have some sufficient checks and balances in the rule to keep teams from not considering finances at all (something like 2 seasons of 10M+ losses and *then* impose a stricter cap on them - at least it gives owners flexibility in the short term to try and pull themselves up by their boot straps when they need - or, more importantly, not lose building blocks due to an unfair system).

Very interesting idea.

[recte44]

Nothing is broke. Kevin nailed it.

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