Nov 4, 2013, 3:31 PM EDT
Under the current CBA, NHL players are supposed to receive 50 percent of hockey-related revenues, with the owners getting the other half. Occasionally, however, the two sides can’t agree how to add up the revenue. Such is the case, apparently, when it comes to the New York Islanders and their cable TV deal.
When Charles Wang bought the Islanders in 2000 for $187 million, $30 million of the purchase price was allocated to the team’s lucrative cable television contract, which belongs to MSG. The disagreement between the Islanders and the NHLPA is how the amortization (non-cash expense) should be treated when counting the team’s revenue for purposes of calculating the league’s salary cap. This season players are entitled to 50% of hockey-related revenue, according to the collective bargaining agreement between the players and owners that took effect last season.
Based the CBA, the Islanders claim they should be allowed to reduce their annual revenue by the amount of the annual amortization of the cable contract (a few million dollars a year). The NHLPA believes the Islanders should not be able to lower their revenue–and thus the amount of revenue that the players are entitled to–with a paper expense because the team is getting the full amount of the cable fee (over $20 million this season).
Again, this happens from time to time. For example, with the $25 million payment the Phoenix Coyotes received from the City of Glendale during the 2010-11 season. The union wanted that counted as HRR; the NHL didn’t. That dispute went to arbitration, according to the Globe and Mail.
As for this case, sources tell Forbes the Isles are likely to prevail.
We’re sure you can’t wait to find out for real.
- Report: Plotnikov paid $500K to get out of KHL contract 11
- Philadelphia signs ’15 first rounder Provorov 10
- Brandon Saad brings championship experience to Blue Jackets 22
- Sharks sign Joel Ward to three-year deal 24
- Sabres lock up O’Reilly through 2022-23 73
- Locked in: Columbus signs Saad to six-year, $36M deal 27
- Oilers sign McDavid to entry-level contract 29
- ‘Hawks would like to re-sign Oduya, but still working through ‘financial hurdles’ 17
- Trade: Caps acquire Oshie from Blues for Brouwer, Copley and draft pick 73
- Voynov takes plea, gets 90 days in jail plus probation 66
- Blockbuster: Kessel traded to the Penguins (131)
- Trade: Flyers send Rinaldo to Bruins for 2017 third-rounder (105)
- Trade: Jackets land Saad; Anisimov and Dano headed to Chicago (93)
- Bypassing a buyout? Kings terminate Richards’ contract for ‘material breach’ (90)
- Trade: Caps acquire Oshie from Blues for Brouwer, Copley and draft pick (73)