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.

6 thoughts on “New NFL CBA outlines “stadium credits”

  1. The G3 fund allotted the NY teams 150M each team for their new stadium.

    If the Raiders join the 49ers then the NFL will do the same and at this point with the A’s stuck at the Coliseum until 2013 the Raiders have little choice.

    In the long run when the current CBA expires in 2020 perhaps then the A’s will be gone and the Raiders can ask for some $$ for a Oakland stadium.

    In the meanwhile Santa Clara is so far ahead of anything Oakland has right now that is the best bet going forward.

    Santa Clara will allow both teams to maximize corporate dollars while as Al Davis has said “Oakland is a depressed area”.

    2015 is going to be a good year for the NFL in the Bay Area!

  2. I’m still not certain the differences between the ‘credit’ and the G3 fund. Is it just the source of the money? And is the money taken out every year and put into a separate account, or do they only take money out in years when the league is helping teams get a stadium funded?

    • @LS – The credit is the revenue source that will allow teams to secure loans from what we can now call the “Son of G-3” program. It’s only available when teams get their stadium deals done and the league approves. I assume that unused funds go back to the players.

  3. @Sid perhaps because Nassau is the same city that they are playing in. I think the Rangers’ opinion would be different if the Islanders were moving to Brooklyn….

  4. The Rangers may also perceive that Brooklyn could in fact be a fallback option. I hear there may be a new arena there soon…

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