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NBA working toward solution for economic issues
Posted By Jessica Camerato On July 14, 2009 @ 11:34 pm In General | 6 Comments
LAS VEGAS – NBA players may be viewed as superstars, but that doesn’t mean the league is immune from the same economic problems faced around the country.
On Tuesday, the NBA held a Board of Governors meeting in Las Vegas to address its financial issues and concerns. Commissioner David Stern said less than half of the teams made a profit in the 2008-2009 season. Now, the league is working to combat the slide.
In response, Stern has appointed a Labor Relations Committee consisting of league executives, a group that includes Celtics co-owner Wyc Grousbeck. This select group will participate in a meeting on Aug. 4 with the National Basketball Players Association Union’s executive committee.
Stern said it is important for the players to be aware of the financial state of the league, as they are impacted by the decreased salary cap and increased luxury tax.
“We would very much like to begin these negotiations on a positive note of complete disclosure of financials and the readiness to provide more,” he said, “Because that will lead us together to look for a good agreement moving forward that will continue to pay our players, which is the what is the largest average salaries in the history of professional sports, while at the same time return our teams to profitability.”
After projecting a 10 percent drop in ticket revenue and experiencing less interest in sponsorship opportunities, the NBA will focus on new revenue opportunities. The league will hold also hold workshops on the best practices for increasing profits.
In the meantime, teams around the league are getting creative to build championship contenders. Rather than shelling out millions for stars, organizations are opting for trades instead of max contracts.
San Antonio (Richard Jefferson), Cleveland (Shaquille O’Neal), and Orlando (Vince Carter) have increased their shots next season without taking on new salaries.
“In some ways, you can’t sign free agents because only four teams were under the cap, so you have to have trades. That’s just is the way it’s going to happen,” Stern said. “You’ve got to be imaginative to get these things like these four-team trades that I have to sit down and have someone explain to me with large charts so I can understand what happened. So that’s ongoing.”
The reality is that not every team will be able to pull off a blockbuster deal. The league is working toward new rules and regulations that will allow its organizations to thrive in this market.
“We want our teams to be competing,” Stern said.
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