March 3 (Bloomberg) -- The National Football League and its players’ union were negotiating at a mediator’s office today in a bid to reach an agreement on a labor accord before the existing one expires at midnight.
Union and league leaders converged this morning at the Washington office of mediator George H. Cohen, head of the Federal Mediation and Conciliation Service. Failure to reach an accord may result in a shutdown of the U.S.’s most-watched TV sport a month after the Super Bowl drew the biggest audience in U.S. television history.
They were discussing an extension of the current agreement of at least a week, a person with knowledge of the talks said. The person was granted anonymity because Cohen ordered the sides to keep quiet while mediation continued.
Owners and players are wrangling over how much of the league’s $9 billion in revenue players should receive. Other areas of discord include a proposal to expand the regular season to 18 games from 16, a cap on rookie pay and health-care coverage for players.
The league may elect to lock out players when the collective bargaining agreement expires tonight. A work stoppage, which would end 24 years of labor peace, may empty stadiums financed with a combined $7 billion in taxpayer money, interrupt the schedules of the largest U.S. broadcasters and leave fans without a sport that during the 2010 regular season was watched by a record 207.7 million people, according to Nielsen Co. data.
Negotiators for both sides met yesterday for a 10th time under the supervision of Cohen, who last year helped broker a deal between Major League Soccer and its players.
“No decisions were made, no actions were taken,” Greg Aiello, a spokesman for the NFL, told reporters last night. “We will continue to go through the mediation process.”
This morning, NFL Commissioner Roger Goodell, chief negotiator Jeff Pash, Eric Grubman and Bob Batterman, and New York Giants President John Mara were among the group of league officials to arrive at the mediator’s office. Union Executive Director DeMaurice Smith and President Kevin Mawae arrived later.
Owners met in Chantilly, Virginia, 24 miles outside Washington, for about three hours yesterday, with most leaving the area after the session. Members of the labor committee remained for about an hour.
“I never have expectations,” Indianapolis Colts owner Jim Irsay told reporters. “It’s a chessboard that moves around and things change.”
After talks with the NFL Players Association ended yesterday, Goodell, Pash, Mara and Green Bay Packers President and Chief Executive Officer Mark Murphy returned to the mediator’s building for a meeting that union officials didn’t attend.
Cohen asked that the league not comment on the discussions, Aiello said.
Standard & Poor’s yesterday cut in half to a year the amount of time it estimated that teams can make debt payments on stadiums during a work stoppage.
The ratings company’s decision came a day after federal Judge David Doty in Minneapolis ruled that the NFL improperly negotiated television contracts to receive $4 billion in revenue if a work stoppage cancels games during the 2011 season.
The ruling provided “irrefutable evidence that owners had a premeditated plan to lock out players and fans for more than two years,” the union said.
Clubs were prepared for the ruling, which “will have no effect on our efforts to negotiate a new, balanced labor agreement,” Aiello said.
The sides may opt for a temporary extension of the existing deal if they fail to reach an agreement today, Pash said before the Feb. 6 Super Bowl.
“If you’re making progress, you can stop the clock,” he told reporters.
The union says it may also abandon its role in the negotiation, or “disclaim interest,” allowing players to seek a court order that may block owners from shutting down the league.
Owners voted in 2008 to opt out of the collective bargaining agreement, saying it didn’t account for costs such as those of building stadiums. They want to double the $1 billion they deduct from total revenue before player payrolls are calculated to meet costs related to stadiums, marketing, NFL.com and the NFL Network, according to Smith, the union’s executive director.
The outgoing deal gave players too much money before accounting for costs, Grubman, the NFL’s executive vice president for business ventures, said before the Super Bowl.
New stadiums, he said, increase league revenue and salaries for players, while owners bear the finance and maintenance costs. With players receiving $3.8 billion of the league’s $5.5 billion in new revenue since 2006, owners have little incentive to grow their businesses, said Grubman, a former executive at Goldman Sachs Group Inc.
The league has refused to disclose financial data to back up its claim that players are paid too much, with Goodell dismissing Smith’s demand as a negotiating ploy.
According to the union, players accepted an $800 million payroll cut over 15 years to alleviate concerns about the cost of the Giants’ and Jets’ new stadium in East Rutherford, New Jersey.
The dispute has already cost $120 million in ticket sales and sponsorship revenue, according to the league. The total will rise to $1 billion if it takes until the scheduled September season opener to reach an agreement.
Every week of lost games would diminish revenue by about $400 million, according to Grubman and Pash.
To contact the editor responsible for this story: Michael Sillup at email@example.com.