In a ruling handed down last week by arbitrator Stephen Burbank, the NFL has been hit hard with a decision aimed directly at its pockets. The NFL Players Association recently announced that the league must fork over $120 million to the revenue pool the league and its players’ union share. The arbitrator found that the NFL had “mischaracterized” nearly $50 million of revenue a year that otherwise would have been paid to the players. The order comes after the Players Association discovered the issue in January 2016 during an ongoing league audit.
Naturally, the NFL was not quick to comment on the issue or to take responsibility for the hidden money, with one spokesperson describing the matter as nothing more than “a technical issue under the CBA involving the funding of stadium construction and renovation projects.” As per the terms of the current collective bargaining agreement between the NFL and its Players Association, the teams are allowed to exclude money from the revenue pool, albeit under limited circumstances such as the sale of personal seat licenses, premium seating sales, and deals with sponsors to name stadiums. These exclusions are to help fund financial renovations and construction of new stadium projects — moves that increase the amount of revenue the players share on the back-end. Without the exclusions, players are able to receive 40 percent of all local revenue, 45 percent of sponsorships, and 55 percent of money earned from media deals, among other things.
According to the NFLPA, it was found that the league created another exclusion category not present in the CBA. This money the NFL kept without players’ knowledge, the arbitrator found, and so it needed to be returned and shared with the players on basic contract principles. The NFLPA believes the returned money will have a direct effect on the upcoming football season, calculating an increase to the salary cap by roughly $1.5 million per team.