The Corrections

14 Oct

After re-reading my posts from two weeks ago on the Collective Bargaining Agreement and salaries, and discussing the CBA with people, like Tyler Dellow, who understand it much better than I do, I’ve come to realize that I’ve written poorly about the issue of non-Hockey Related Revenues, to the point of being erroneous. I’d like to take a moment to correct myself, in particular for this statement: “Non-HRR cannot be used by the owners to run their teams.”

Non-Hockey Related Revenues can be used to operate an NHL hockey team. When I said that they couldn’t, I meant (and wrote) that at a team level, additional revenues couldn’t help the Oilers ice a more competitive club because they’re not allowed to spend beyond the salary cap, and they’ve already been spending at or near the limit. Additional revenues of any kind will simply improve the owner’s economic return.

At a league-level, the salary cap itself is tied entirely to league-wide Hockey Related Revenues, which guarantees the players a fixed share of HRR. The other point I was trying to make is that the owners (collectively) would rather earn a whole dollar of non-HRR rather than just a portion of HRR. It therefore makes sense for them to make deals where they get all the non-HRR revenue, where there are more luxury suites and concessions, and where the city they operate in foots the bill on arena construction.

Where this explanation got muddy is that I made the CBA’s revenue definitions (which govern the salary cap system) sound like rules that restricted the spending and investment activities of individual clubs. They don’t, and I apologize for the error.

I stand by my view that the Oilers need to be transparent and open their books to prove they are in fact losing money. I also stand by my view that if they are losing money, it is because they are spending too much, spending unwisely, and putting in place a management group that isn’t getting them to the playoffs.

In the two posts I mentioned above, I will keep the current text, along with an asterisk that will lead people to this post. I don’t feel that it’s appropriate to erase my mistakes and pretend like they never happened. Over the past four years I have worked very hard to be a credible source on the arena issue, and have tried my best to bring to light facts and opinions about it that I felt were being ignored by the mainstream media. In particular, I have been very critical of some local publications and journalists for providing what I considered to be one-sided and sloppy reporting on this issue. Well, I did a really sloppy job. It’s my time to eat some humble pie.

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5 Responses to “The Corrections”

  1. Andy Grabia October 16, 2010 at 11:14 pm #

    I’m just blown away that Monday is the end of the campaign and this HUGE issue was kept pretty far from the table.

    Yup. Pretty sad. The airport, and all the squabbling there, overshadowed pretty much everything else.

  2. chartleys October 15, 2010 at 9:06 pm #

    I’m just blown away that Monday is the end of the campaign and this HUGE issue was kept pretty far from the table. It blows my mind that so many candidates flat out refuse to have their position on this issue laid out in their platform. It is a pretty embarrasing. If this happens without running it through a plebiscite and a completely different funding model, I will be heading down to throw lawn chairs at city hall.

  3. RyanB October 14, 2010 at 4:43 pm #

    “Oilers need to be transparent and open their books to prove they are in fact losing money”

    This is my issue with how the arena “negotiations” have been handled to date. Until the Oilers open their books up to the City (not the general public although I’d love to see them) I don’t see how the City can even consider making a deal on the new arena. Without that information every decision is simply based on what the Oilers say is true. Now I don’t have any proof that they lying about anything they’ve said but when hundreds of millions of dollars are at stake I don’t trust anyone.

Trackbacks/Pingbacks

  1. Waste Not, Want Not « Why Downtown? - October 14, 2010

    […] Please read this link for errors I made in the writing of this […]

  2. The CBA « Why Downtown? - October 14, 2010

    […] Please read this link for errors I made in the writing of this […]

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