Sep 21, 2009

Banker

So yeah…that just happened.

The NBA has locked out its referees.  The whole issue has stemmed from the two sides inability to get a new deal done (the current deal expired on September 1st).  Surprisingly, salary is not an issue.  Although a myriad of other issues do exist.  Via ,

…they largely agree on salaries, but the union has balked at the league’s attempt to change retirement benefits.

Besides the severance and pension disagreements, the officials are resisting a league development plan for young officials.

Without a new deal, replacement officials will be used when preseason play opens Oct. 1. The NBA last began a season without its regular referees in 1995-96, when the caliber of officiating was roundly criticized.

previously said the officials, sensitive to the financial difficulties the league is facing, agreed to $2.5 million in concessions, but the league sought further cuts in areas such as the travel budget and per diems. Stern said the goal was to bring the referees’ budget in line with other departments.

But McMorris said the officials are unwilling to accept any further changes to their retirement benefits.

“We’ve given so many concessions in other areas, a line has to be drawn,” he said. “It has to be fair and equitable for everyone in our group.”

That was all on Wednesday and Thursday.  And on Friday? the lockout occurred.  The most probable cause of the situation? That would be the economy.  Again via , (emphasis is mine)

“The proposals we have made to the NBRA are extraordinarily fair and reasonable, given the current economic circumstances,” the NBA’s Executive Vice President and General Counsel Rick Buchanan said in a league memo. “Since late 2008,

the league and our teams have made far deeper cuts in non-referee headcount and expenses than we are asking for here.

“It is extremely disappointing that the NBRA has ignored the economic realities, rejected our offer, and left us with no choice but to begin using replacement referees.”

So what does this all mean?  To date, this is by far the largest repercussion of  the economic recession.  Sure, we’ve seen teams borrow money, or have empty seats or lose out on merchandising revenue or ad revenue, but this lockout threatens the quality of a sport across the entire league.  This isn’t the Super Bowl selling a lower number of ads in comparison to last year; this is really big news.

The NBA will now see the quality of their game drop due to the recession.  Although some people view this as a positive, and from a refereeing standpoint I’m not in total disagreement, it does make me wonder about the financial future of the NBA.  This is the same league that had to bailout half of its teams back in February…the league that is now allowing courtside liquor ads because they need the extra revenue.  The league who’s “worst-case” salary cap decrease was deemed to be not enough by a majority of the owners…shouldn’t we all be a little worried?  Seriously, forget they’re the NBA for a minute and look at the facts:  half of the teams are failing, they’re searching for new revenue streams, worst-case cut backs aren’t enough, and they’ve basically laid people off because they can’t afford to pay them.  That’s not good.

And its not necessarily getting better any time soon.  Sure, we may see the economy turn around, but if all it takes is a recession to basically kill the entire league this quickly, it seems more likely that the recession is exposing problems within the NBA system more than the lack of money is actually killing the league (for a reasonable comparison, I know hockey is struggling too, but they still have referees and didn’t bailout half of their teams).  Chances to rectify the NBA’s problems would only come about with a new collective bargaining agreement.  The current CBA, at the earliest, expires after the 2010-2011 season.  Although I doubt we’ll be dealing with a 4 team NBA by then, I am at least a little concerned.

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