Jones: New Hurdle for L.A.

One of the NFL owners most staunchly opposed to changing the league’s revenue-sharing system said doing so probably would derail efforts to put a team back in the Los Angeles market.

Jerry Jones, owner of the Dallas Cowboys, said at his team’s training camp in Oxnard that if a higher percentage of revenues were shared -- as some owners say should be the case -- investing in the nation’s second-largest market would become far less attractive.

“Why does somebody want to move a team, or pay an arm and a leg for a team, plus make the investment in a stadium, if you don’t let them have the incentives to go do it?” Jones said recently during an hour-long interview with The Times. “I’m trying to be a realist about getting L.A. Santa Claus does not put the tricycle under the Christmas tree.”

But a source familiar with the NFL’s dealings in Los Angeles said the impact of a change could lower the asking price for an L.A. team -- money that would be shared among the other franchises -- rather than killing the chances for L.A. to land a team.

Jones said, however, that because it would probably be a relocated team in Los Angeles, it would be up to that franchise, and not the league, to establish a price.

NFL revenue sharing has come under renewed scrutiny as the league and the players’ union work to extend the collective-bargaining agreement, which expires after the 2007 season. Because players are expected to become more expensive after that, the league is searching for ways to close the financial gap between the richest clubs and the least prosperous.

So pressing are the financial issues that NFL Commissioner Paul Tagliabue took the unusual step of scheduling an owners’ meeting a month, from June through October, to settle them. The owners will meet in Chicago today and Thursday, breaking into eight groups of four to work on resolving their differences.

Tagliabue and a majority of owners are trying to find ways for clubs to share more of their locally generated revenues. At league meetings in May, Tagliabue said possible compromises included one plan to share previously unshared revenue beyond a certain percentage, and another to have a “blended rate” percentage for sharing all money.

For more than 40 years, the NFL has viewed revenue sharing as its lifeblood, the great equalizer that allows small-market teams, such as the Green Bay Packers, to compete on equal footing with those from large markets.

It also has helped forge an agreement with the NFL players’ association, allowing pro football to avoid the work stoppages that have afflicted every other major professional sport in the last 15 years.

But Jones said if teams were required to share more of the revenue they generate, the practice would discourage potential investors in the L.A. market, those who will need extra revenue to cope with the debt of a transaction expected to exceed $1 billion.

By Jones’ calculation, the occupancy cost of an L.A. stadium, which includes running the stadium as well as interest, could easily approach an unprecedented $150 million a year.

“I can tell you that the communal check that everybody gets in the NFL will not justify what it’s going to take to put a team in Los Angeles,” he said.

As it is, each NFL team receives an equal share of television money and of league-controlled sponsorship deals -- such as the apparel contract with Reebok -- and each franchise shares about 34% of its ticket revenue.

Unshared is the money generated by local radio and preseason TV deals, luxury suites, concessions, parking, a club’s retail sales and sponsorships, and stadium naming rights.

“The bottom line is that the system that is in place is not broke,” Jones said, adding that, to find fault with the current structure, critics “have to be looking for something that isn’t here today.”

A source familiar with the revenue-sharing negotiations said Jones and some other owners had looked for ways to pocket more local revenue while reducing the amount of shared revenue.

One method would be to reduce ticket prices -- ticket money is shared with the rest of the league -- while increasing the cost of parking and local sponsorships. Carried to an extreme, that could one day make parking more expensive than a ticket to a game.

NFL owners voted in June to help fund the Cowboys’ new stadium, as part of the league’s so-called G-3 loan program, but Jones called that “apples and oranges.” He said the Cowboys had been paying their $1-million-a-year share into the G-3 pool for years.

“And,” he added, “it’s proven that the stadiums are a tremendous asset to the NFL. And so we’re making a huge -- the Cowboys, I am -- making a huge financial investment in this stadium, arguably one of the biggest, if not the biggest, that’s been made in a stadium from the club-ledger side.”

The way Jones sees it, a potentially explosive issue is whether the league can change its revenue-sharing structure with a three-quarters vote of the owners -- as is required of other decisions -- or, as he is pushing for, unanimous approval.

The NFL considers its financial information so confidential and sensitive, that it does not share it with individual clubs. When teams submit their financials, they are told only into which quartile they fall.

In 2001, The Times obtained and published the league’s confidential financials, documents that showed teams with new stadiums made significantly more unshared revenue than those playing in older venues.

Jones said it would be wrong to take a “snapshot of the league” from where teams currently stand and attempt to level the field financially. He argued it was only natural that teams with new stadiums should make more money because those clubs needed to pay down the debt associated with building those venues.

“Once they digest that [debt] ... they’ll gradually come down,” he said.

If every team were on equal footing and there were not a churn at the top, Jones said, potential investors would consider it “madness” to pour money into an L.A. franchise.

He said a potential L.A. owner should be thinking: “I’ve bought into the league. I’ve built a stadium. I’m willing to go to work. I’ve paid a lot of money to be in Los Angeles. I’m willing to go to work, and I’m going to do all the things to build this franchise with what everybody expected. But let me get it digested. Don’t take away from me the incentive to do it to begin with.”