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THE NHL LOCKOUT

A 'Bleak Day'

As the collective bargaining agreement between the league and its players expires, the owners shut down the sport, leaving the season in jeopardy

September 16, 2004|Helene Elliott | Times Staff Writer

NEW YORK — The collective bargaining agreement between the NHL and its players' association expired this morning, leading owners to lock players out of arenas and practice rinks on the eve of the first day of training camp for most of the league's 30 teams.

It was an acrimonious end to a deal forged 10 years ago after a 103-day lockout cut the 1994-95 season to 48 games. The agreement was extended twice, but salary arbitration, lavish rookie bonuses and outsized free-agent spending by a handful of clubs sent salaries soaring at a pace that far outstripped revenues.

Commissioner Gary Bettman said Wednesday that he is not bound by a timetable to resolve this dispute, but added that he authorized teams to release arena dates they had reserved for games or practices over the next 30 days. The NHL season was scheduled to start on Oct. 13.

Bettman said the NHL could no longer operate with a labor structure that spawned losses of $497 million the last two seasons. He began planning for this more than five years ago, directing each club to contribute $10 million to a "war chest" to be used for operating expenses during the lockout.

Half of the NHL's staff, about 100 people, will lose their jobs by Sept. 30; many clubs have laid off staff or reduced workers' hours or pay to pare expenses.

Players' salaries have jumped from an average of $733,000 in 1994-95 to $1.83 million last season. A league-commissioned study last year said teams devoted 76% of their revenue to player costs in 2002-03, a dangerous level for a league whose TV revenues brought each team about $6 million last season -- a pittance compared with the $82 million doled out to each NFL team. The NHL's TV deal for this season was based on revenue sharing, with no upfront money.

"Unfortunately, we lose less money by not playing, and we know if we were to try to continue to play we would lose franchises and be in terrible, terrible shape," an often emotional Bettman said after the Board of Governors voted unanimously to support a lockout. "We are out of gas."

The last negotiations took place last Thursday, when the union offered to roll back players' salaries 5%, reduce salaries for players in their first few NHL seasons, and accept a luxury tax designed to discourage extravagant spending. The tax money would be distributed among small-market teams, lifting them closer to equal footing with such rich rivals as the New York Rangers and Detroit Red Wings.

Of the four major team sports, the NHL alone does not have a salary cap or luxury tax. But the NHL rejected the luxury tax proposal last week as too weak to rein in spending and give the 20 clubs that lost money last season a chance to break even or become profitable.

"No one is more unhappy about this situation than I am," Bettman said. "My pledge is we will correct this situation the right way. The game's future depends on getting the right system."

To him that means "cost certainty," which he defined as "an enforceable and definable relationship between expenses and revenues so that a team's ability to compete depends on its team-building skills, not its ability to pay."

The union defines that as a salary cap, and it has rebuffed each proposal that linked salaries to revenues.

"We understand there are some issues, and that's why we offered $100 million in givebacks," said Trevor Linden of the Vancouver Canucks, president of the National Hockey League Players' Assn. "We've already given up a lot of concessions. Players believe strongly that what we offered has the framework to work."

Bettman and club executives derided the proposal as a rehashed version of one they rejected last year.

"It is sad the union could see this bleak day approaching and not lift a finger," Bettman said. The NHLPA, he added, "is dug in. To use a hockey term, they're instigating a fight. They think they can win this fight and they will get to keep the most [money]. They won't, and time will tell that."

Participants in the meeting were told not to speak to reporters, but those who did voiced a similar resolve.

"We've got some problems to solve, and we're going to solve them," said Bill Torrey, alternate governor of the Florida Panthers. "Any time hockey's not played it's sad for players, fans and the media, but it's time for us to solve our problems."

Said Jim Rutherford, general manager of the money-losing Carolina Hurricanes: "The present system doesn't work for us. We need a new system. We'll see how it plays out with the fans. I'm sure they're frustrated. We're all frustrated."

No negotiations were scheduled as of late Wednesday. Bob Goodenow, the NHLPA's executive director, said it would be a mistake for Bettman to try to break the union by declaring an impasse and unilaterally implementing new labor rules. "I think it's a very ill-advised strategy," Goodenow said. "It could be catastrophic."

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