New NFL CBA outlines “stadium credits”
While the mad scramble to cut, sign, and trade players happens this week, a clearer picture of stadium financing has also emerged. Last week, Tim Kawakami wrote about so-called stadium credits that would be available for cities that embarked on building new venues. Now, thanks to further digging by the Chronicle’s Kevin Lynch and by Niners Nation, the mechanism makes a lot more sense.
In the previous CBA, owners took $1 billion off the top for stadium expenses. This time, the players wanted a piece of the whole pie. To make that happen, they had to agree to share the burden of stadium construction costs. That means cutting their share of the new revenue pie from 50% to 47-48%. Up to 1.5% of total revenue will be set aside as a credit for new stadia. If the total revenue for the 2011 season were $9 billion, the credit would be worth around $135 million per year.
The credit is much like a tax credit a person would get for buying an electric car. It’s only available once the vehicle is purchased. Along those lines, the stadium credit would only be available once a stadium broke ground.
It’s important to note that the credit is league-wide. It’s also meant to cover loans much like the G-3 program did under the past CBAs. For the 49ers, the credit reflects basically the expected amount they’d get from a league loan. A similar amount would also be available to the Raiders. While it’s a big, reassuring step for the 49ers, all it really does is erase the uncertainty surrounding stadium financing going into the CBA negotiations. There’s still a big gap that needs to be covered, and I don’t think it gets covered without the Raiders being as committed to Santa Clara as they can possibly be.
Update 12:39 PM – Tim Kawakami has more from a discussion with Jed York.