Quote:
Originally Posted by PeteMoss
The reason I believe the cap doesn't jump next year is because that cap is based on this year's revenue. The new TV money doesn't factor into the cap until the year after.
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The CBA allows for "significant" known increases (and decreases) to be used in calculating the new cap. It defines significant as $20 million or more per season, and includes any source of revenue that can be accurately predicted, such as the opening of a new arena; a new sponsorship deal; or a new broadcasting rights deal.
The process for calculating the new cap is:
- Take the preliminary actual HRR from the season that just ended
- Subtract any known significant revenue decreases expected for the upcoming season (for next year, if they reduce the number of outdoor games, it may cause a significant reduction in revenue)
- Add a 5% growth factor to the total to account for expected increases in revenue due to inflation and growth of the game
- Add any known significant revenue increases expected for the upcoming season
This will provide the anticipated league-wide HRR for the upcoming season. They then take 50% of that number to determine the anticipated players' share of revenue.
From that number, they subtract the full cost of the players' benefits packages. This gives them an expected total value for all players' salaries for the upcoming season. That number is divided by 30 to determine the per team adjusted midpoint of the salary range, which should be the median team payroll for the upcoming season. Under the new CBA, the cap will be set at 115% of the midpoint and the floor at 85% of the midpoint.