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Tuesday, December 14, 2004
Bettman rejects proposal; counteroffer turned down

Associated Press

TORONTO -- The NHL moved a step closer to losing the season Tuesday, when the league and players' association rejected proposals for a new collective bargaining agreement.

Comparison Look At Proposals
by NHL and Players' Association
SALARY ROLLBACK
UNION: Immediately cuts 24 percent off all existing contracts. NHLPA says that will save teams $270 million in the first year and $528 million over three years. Its previous offer of Sept. 9 only offered 5 percent rollback.
LEAGUE: The 349 players making less than $800,000 would not lose any salary. The 191 earning between $800,000 and $1.499 million would take a 15-percent cut. The 58 players earning between $1.5 million and $1.99 million would take a 20-percent decrease. The 133 players making between $2 million and $3.99 million would take a 24 percent cut. The 24 players making between $4 million and $4.99 million would receive a 30-percent cut. The 41 players earning $5 million and up would lose 35 percent.
SALARY RESTRAINTS
UNION: Would restrict rookie contracts to $850,000 a year for three years, down from last season's $1.2 million level. There also would be reductions in qualifying offers to restricted free agents, and clubs would have the chance to elect arbitration in a system similar to one used in baseball.
The union estimates clubs will save $400 million over the next six years and reduce the aggregate qualifying offers due to restricted free agents by $285 million over three years.
LEAGUE: Would accept the NHLPA proposed maximum salary with the provision of additional mandatory year in all entry-level contracts. It would eliminate all signing and performance bonuses.
LUXURY TAX
UNION: Would penalize teams 20 cents for each dollar they spend between $45 million and $50 million. The penalty would increase to 25 percent the second year and 30 percent in the third.
Teams spending between $50 million and $60 million would be taxed 50 cents on the dollar the first year, 55 cents the second year and 60 cents the third. Those with payrolls above that would have to pay 60 cents for every dollar the first year, 65 cents the second, and 70 cents the third year on each dollar over the threshold.
LEAGUE: No payroll tax. The NHL says a luxury tax requires guesswork, continues payroll disparities, and is inflationary.
The second negotiating session in a week lasted 3½ hours. The league turned down the players' association offer from last Thursday and presented a salary cap-based counterproposal for an hour. The union then held its own discussions for 2½ hours before rejecting the offer and ending the meeting that came on the 90th day of the lockout.

No new meetings have been scheduled, making it quite possible that the NHL will become the first North American sports league to cancel a full season because of a labor dispute.

The major difference between the sides remains the salary-cap roadblock. The NHL wants a cap to achieve what it calls cost certainty. The players' association says it will never accept that.

Asked about the prospects of having a season, Ottawa forward Daniel Alfredsson said: "If they stand by their salary cap, the chances are none."

NHL commissioner Gary Bettman acknowledged the league is after a cap.

"My hope is that the union leadership recognizes that the owners' resolve is great," Bettman said. "We only know of really one approach to meaningfully address and fix our problems. And unless somebody can miraculously come up with another approach, which I am highly skeptical of but always [eager] to listen, we're committed to fixing this the right way."

There might be a month left to salvage the season, but the sides seem too far apart on the philosophical difference of a cap. The last NHL lockout ended with a deal on Jan. 11, 1995, allowing for a 48-game season.

This lockout has already forced the cancelation of 414 regular-season games and the 2005 All-Star Game.

"As I've said all along, it's about getting the right deal," Bettman said. "I would hope at some point it gets to where it's relevant. If not, we'll start up whenever we have a new deal.

"We haven't focused on what a semblance of a season would be."

The league proposal contained a cap, which, based on last year's economics, would see team player costs range between $38.6 million and $34.6 million.

The NHL also revamped the players' association rollback offer, proposing a graduated scale. Players making less than $800,000 would not have their salary decreased. Those making $5 million or more would have 35 percent taken away from their existing contracts.

Bettman said the offer made by the union last Thursday, which featured a 24-percent salary rollback, was a "big-time, significant and meaningful move" but was a short-term fix that wouldn't cure the league's financial troubles in the long run.

"In short, the league took what they liked from our proposal, made major changes and slapped a salary cap on top of it," union head Bob Goodenow said. "Put simply, our proposal provides the basis for a negotiated agreement. The NHL's does not."

The union's offer also contained a luxury tax, a revenue sharing plan, a lower cap on entry-level contracts and bonuses, and a way for teams to take players to arbitration.

But because it doesn't guarantee what each team will pay its players, it didn't meet the solution the owners are seeking.

"We have no interest in a luxury tax at any level at any threshold," Bettman said.

The Canadian sports television network TSN reported Monday that NHL executive vice president Bill Daly sent a memo to team owners that said the league would turn down the union's offer.

Bettman has placed a gag order on team executives, and has already handed out significant fines to those who speak out. Steve Belkin, one of the Atlanta Thrashers' owners, was ordered to pay $250,000 for saying the league would use replacement players next year if a new collective bargaining agreement isn't reached.

The punishment will be much harsher if the source of the leaked memo is revealed.

"If I find out, there won't be much reason for you to be talking to them because their career in the NHL will end abruptly," Bettman said. "I think it's about the most irresponsible thing that could be done. I would really like to know who did it."

The NHL hadn't given the players' association an offer since July 21, when it presented six possible concepts to provide a framework for the league's first new collective bargaining agreement in a decade.

All six were formally rejected by the players on Aug. 17, and negotiations that followed over the next month failed to move the sides any closer to resolving the philosophical difference of a salary cap.

Talks broke off Sept. 9 when owners turned down an offer, and the lockout was imposed a week later by Bettman. Players and owners stayed apart from early September until last Thursday.

Canadian Prime Minister Paul Martin offered federal intervention on Tuesday, but both sides have said they don't need an outside mediator to get involved.