Entertainment

The Man in the Middle

Jan./Feb. 2010

Kevin Mawae anchors the middle in the looming battle between NFL players and owners

Kevin Mawae (pronounced /məˈwaɪ/) fights for a living. He gets down practically on his hands and knees and uses his nearly 300-pound frame as a shield against an oncoming rush of other 300-pound men. It's a skill he's been perfecting most of his life, the last 16 years as a professional. His more celebrated coworkers -- the quarterbacks and running backs who ride more glamorous on-field roles to greater recognition and reward -- owe Mawae a debt of gratitude. He protects their blind sides. He opens up paths for them to scramble, throw and rush to glory. And he's one of the best. The experts who follow the games, as well as the fans who consume it, have voted him among the profession's elite numerous times. But it's all in a day’s work for Mawae. And, to be fair, he is handsomely compensated for a job well done. His company pays him nearly $4 million annually to battle in the trenches. Not bad work if you have the body, the brains and the discipline to get it.

But the 38-year-old offensive lineman for the Tennessee Titans has another job. He's also the current president of the National Football League Players' Association (NFLPA), the league players' union. And though his other role doesn't involve dirty uniforms or picking himself up off the turf, it has involved him in a fight that's just as crucial to the livelihoods of him and his fellow workers. As NFLPA's president, Mawae protects the pocketbook rather than the pocket. And here, too, Mawae is considered one of the best -- his colleagues have elected him to represent their best interests year after year.

The stakes are high. At the current juncture, Mawae's role involves leading negotiations on a new labor deal or collective bargaining agreement (CBA) between players and league owners intended to preserve the $8 billion industry that has made employees like Mawae into millionaires playing a game.

But, of course, it's more than a game, and it's more than a business. Professional football in America is a favored past time and passion for millions of Americans. It's a product for which consumers feel a strong sense of personal ownership and from which cities like Nashville derive a considerable boost in national profile. As such, there is much on the line for fans, owners and businesses alike. Can Kevin Mawae help broker a solution that will keep the sport on track? Or will fans see their product -- their passion --go at least temporarily dark over a labor dispute? Either way, the outcome could have a profound impact on Tennessee.

Two Minute Warning

When the Super Bowl concludes next month, the NFL will have successfully closed the book on its 90th season as a professional sports league. It will do so without a new labor contract in place between its owners and its players, since owners recently opted out of the current CBA originally set to expire in 2013. As a result, as of March 2010, just weeks from now (barring an unexpected bargaining table miracle), the league will pack together an icy labor relations snowball and give it a first big push down a long hill.

In the United States, the NFL's popularity among professional sports leagues is unrivaled. Television audiences for games consistently rate among the highest rated programming on the networks. Stadiums routinely sell out. An underground economy of gambling and fantasy sports enthusiasts dwell on the game around the clock. Even annual fan attendance at the Pro Football Hall of Fame induction ceremony in Canton, Ohio -- a weeklong affair attended by hundreds of thousands of fans each year -- makes similar events in other sports pale in comparison.

Asked to explain it, veteran NFL journalist John McClain of the Houston Chronicle, who covered the Titans' franchise for many years before the team's relocation to Tennessee in 1997, says it all comes down to equality. "Parity has made [the league] competitive and popular."

That parity stems from a revenue-sharing financial system wherein the league's 32 teams equally divide $4 billion in annual payouts from national television contracts. A salary cap topping out each team's payroll (teams must spend up to at least 85% of the split or relinquish funds to the other teams) has created unrivaled balance in the league. As a result, teams like the Titans compete on a level playing field with teams in much larger media and population markets like New York and Chicago. Having a legitimate shot at winning a championship means most NFL stadiums are packed with paying fans (additional revenue for the owners) on game days.

After the 2010 Super Bowl, however, that system goes out the window. In its place, there will exist an uncapped system wherein team owners can bid unchecked against each other for top veteran players. Team owners, freed from the rigors of spreading payroll equitably to field a balanced roster, can instead spend lavishly to add veteran players to their squads (the "New York Yankees Effect," if you will). Alternately, owners may cut their payrolls below the current threshold as a cost-saving measure. On this new landscape, smaller markets like Nashville arguably will operate at a disadvantage in attracting free agent talent that larger markets with richer owners will attract.

In 2011, things go from bad to worse. In the continued absence of a new CBA, the league's owners may then lock players out. At that point, owners would either suspend league operations or field replacement players, an experiment they tried during the last work stoppage -- a 24-day affair in 1987 -- to dismal results both on the field and in the minds of consumers.

A Game of Inches

Why risk it? Requests for interviews with members of the Titans' ownership group and front office were declined -- all of the league's owners have chosen to defer comment to the office of the league commissioner, Roger Goodell. Requests for interviews with Goodell's office and NFL spokesman Greg Aiello were not returned. In a nutshell, owners feel the players' share of total league revenue (60%) is too high when it is the owners who are putting up the money for new stadiums and other expansion initiatives from which the players benefit. In a statement released at the time of the owners' decision to opt out of the current CBA, the league stated that, "If the agreement provides inadequate incentives to invest in the future, it will not work." And while the league acknowledged the NFL earns very substantial revenues, it added, "The current labor agreement does not adequately recognize the costs of generating the revenues of which the players receive the largest share."

For an example of costly stadium construction, one need only look to Dallas. That is where last year, Jerry Jones, the flamboyant owner of the Cowboys franchise, opened the new Dallas Cowboys stadium. A marvel of modern construction, the stadium was built at a cost of more than $1 billion -- much of it out of Jones' own pocket. Though with less panache than Jones, many owners around the league have increased their debt loads in recent years by building or renovating stadiums, and many more are thinking about it. Bloomberg recently estimated that debt held by NFL teams today stands at roughly a combined $9 billion.

David M. Carter, executive director of the University of Southern California (USC) Sports Business Institute, says that with owners underwriting the cost of making the game the spectacle that it is, and with debt service on the rise, it's no wonder the owners have chosen to opt out of the current CBA and seek a new agreement.

"If you are an individual owner and you are thinking of renovating a building or building a new stadium, or undertaking any other major initiative, would you really do that if you didn't know how much of the revenue that came out of it was ultimately yours?" Carter asks. "At what point do you choose to stand down until you know with certainty what you need to share?"

Holding the Line

According to the NFLPA, each percentage point the union gives back to the owners would be worth $7 million per team. Multiplied by 32 teams, that's $224 million that players would give back to the owners in salaries and benefits and pensions for its retired players for each percentage point it compromises. Not surprisingly, players don't want to part with the money. And unlike owners, players are mostly content with the current labor agreement, stressing at every public relations opportunity that the owners are the ones threatening a disruption of America's true favorite past time.

As befits an offensive linemen, Kevin Mawae stands in the middle of the current labor relations fray.

Mawae admits that when he first came into the league as a young lineman drafted by the Seattle Seahawks following his graduation from Louisiana State University in 1993, he wasn't a big proponent of the union.

"At the time, it was more about getting a check, and a mindset that the union is kind of doing you over," he says. "That said, I always kept up with what was going on."

Mawae witnessed significant labor improvements for players early in his career, mostly involving free agency and open disclosure of salaries so players could fairly negotiate contracts. Mawae himself went to New York in free agency to play for the Jets franchise in 1998. By then, with several years in the league under his belt, he found himself answering a lot of the questions that younger players were asking. That same year, star Jets receiver Keyshawn Johnson nominated Mawae to be the team's representative to the NFLPA board. Mawae was elected and served in that capacity from 1998 until 2002. The league-wide player board of representatives then elected Mawae to serve on its executive committee, which he did from 2002 until 2008. And that's when, ironically enough, Mawae says he attended the league meetings in Hawaii (Mawae is a native of Hawaii though he grew up in Georgia and Germany in a military family) with intentions of stepping away from union representation altogether.

"Instead, I saw some things going on that I wasn't happy with. I felt that if I didn’t stand up, it was going to go in a direction I didn't think it should go in," he says. "So I ran for president -- and here I am."

In the nearly two years since being elected NFLPA president, Mawae has had an eventful tenure. In addition to preparing for the inevitable CBA imbroglio -- he says players knew as far back as 2008 that the owners weren't happy with the 2006 CBA -- Mawae also had to deal with the passing of legendary NFLPA executive director Gene Upshaw. In the aftermath of Upshaw's death, Mawae headed up the union's search for a new executive director.

The personal irony of his current role is not lost upon Mawae, who remembers taking a labor relations management class at LSU and thinking that he would never use the information. "Years later, I'm the union guy," Mawae says.

Irony aside, Mawae knows this is important. "It's a privilege to play this game, but with the privilege comes lots of rights that you have to fight for and that aren't just given to you. Things like working conditions and medical conditions. Since I've been in the league, retirement and pension and 401Ks and continuing education have come about. Things that every other job in America already had were fought for through this union. I benefit from it, and I want to see the guys coming after me benefit from it, as well as the retired players."

The "Show Me" Stance

Mawae's response to the owners' contention that they can't go on funding the league under the current labor agreement is succinct.

"Show us," Mawae says. "We're smart people. Our players are intelligent guys. Most of us are college-educated. Many of us, especially on the union board, have masters degrees and continuing education degrees. We understand spreadsheets and numbers. If the league's financial structure is not making sense, let us take a look at it. As it stands, they won't open their books. We just have to take their word for it."

Thus far, the owners have refused to provide the union with financial documents supporting their claims of economic disparity and hardship. There is one team in the league, however, whose books are open. In an arrangement that is nearly unique in all of sports, the Green Bay Packers franchise is owned by its fans with 112,120 people (representing 4,750,937 shares) laying claim to an ownership interest. As such, the team offers an unparalleled level of financial transparency compared to the other privately owned teams in the league.

A look at the 2008 numbers reveal that the organization -- a small market team that didn’t make the playoffs and lost fan favorite Brett Favre to New York -- made $20 million in profit with only a slight decrease on investment revenue.

Mawae doesn't mince words when reflecting on the Green Bay evidence.

"The owners are saying there is a cost associated with building and owning a stadium. And there are debt issues with the stadiums, no doubt. But here's the thing: Green Bay netted over $20 million last year after expenses. So what we see is not a team or a league losing money. They just lost a profit margin," Mawae says.

Additionally, the NFLPA argues that when profit and appreciation in the value of each NFL franchise is taken into account, each owner in the NFL enjoys an average rate of return on their investment of roughly $100 million annually. Forbes recently appraised the value of the Tennessee Titans franchise at $1.01 billion -- the first time in history the franchise has been valued north of $1 billion.

What could compel owners to offer up their financial information? USC's Carter says no one should hold their breath waiting for that to happen. "That is simply not in their best interests to do so," he says.

The Loss Column

So what happens if the two sides fail to settle their differences? And, particularly from the standpoint of a non-football fan, who really cares?

Though still more than a year away, there can be no doubt that city and state officials in Tennessee, as well as owners of businesses that depend on game day traffic in the fall and winter, are concerned about the potential economic impact of a lockout. According to figures supplied by the Nashville Area Convention & Visitors' Bureau, direct spending at Titans home games by visitors to Nashville totaled $5.5 million in 2009.

Walt Baker, CEO of the Tennessee Hotel & Lodging Association, says, "We fill hotels on a regular basis for ball games. Downtown eating establishments are full on game day and the night before. A lockout is not a team departure. But on the economic impact side, at least temporarily, it’s pretty similar."

A recent press release distributed by the Music City Center Coalition, a broad-based group of community businesses, civic organizations and individuals actively supporting the construction of a new convention center in downtown Nashville, included information that on an average game day, the Tennessee Titans generate over 2,000 hotel room bookings for fans coming to the game. Tennessee Titans executive vice president Don MacLachlan used the same press release to describe the economic impact of a game day in Nashville, stating, "When Titans fans come to town, they go out to eat, buy souvenirs and support Nashville's hospitality industry."

Mawae points to the roughly 300 people who work for the Titans on game days "and who depend on eight paychecks a year to get them through." He adds that, "Metro police and sheriff's department employees don't get the overtime. Concessionaires do not make the money they thought they were going to make. You lose tax revenues from hotels because you are not playing games in front of people that come from Georgia, Alabama and Kentucky to follow the Tennessee Titans. You are talking millions of dollars on one game day that won't be coming in because of the possibility of a lockout."

Mike Jameson, a lawyer who represents the downtown district on the Metro Council, agrees that the economic impact of Titans games is significant.

"It's an enormous economic engine," Jameson says. "The absence of those games is going to have obvious impacts and effects that are unfortunate."

The Puck Stopped Here

Should an NFL lockout come to pass, it would be the second professional sports lockout within a decade to impact Tennessee. In 2004-2005, Tennessee's professional hockey club, the Nashville Predators, went dormant from a lockout. In the years that followed, the struggling franchise was almost sold to out-of-state investors -- a move that would have likely proved a prelude to a relocation of the entire team. Fortunately, a group of Nashvillians stepped up to purchase the franchise, and by 2008, the Metro Council had approved changes (retroactive to the previous July) that included an increase in subsidy to $7.4 million from $4.4 million. State dollars were also involved in the plan to keep the team viable in Nashville. Such concessions showed that city and state leaders appreciated the value of a professional sports team to a regional economy both as an economic driver for downtown as well as an important part of the city and state's identity.

"Once you get something like a professional sports team, it becomes part of who you are," Baker says. "If you take it away, it's going to have a significant impact."

And that was hockey. For all its popularity north of the border, Lord Stanley's game registers a distant fourth in the ranks of professional sports in the United States. In the U.S., football is king, and any disruption of its reign will be felt much more keenly by the cities in which it rules.

USC's Carter thinks the economic impact of an NFL lockout could be considerable, especially outside the big markets like New York and Chicago.

"It can be quite extensive," Carter says. "In a place like New York, without the NFL, people will spend their money elsewhere. But to a smaller market like Nashville or Jacksonville, football is more important to their overall economy."

Recognizing the Blitz

So will owners risk wringing the neck of the goose that's laying golden eggs? Consider that the $4 billion dollar television deal the league recently struck with the networks is guaranteed to the owners even if no games are played. (That's a lot of eggs set aside.)

Recent moves by the players association suggest the players think a lockout is coming. League-wide, the union has held meetings with players trying to convince them to start saving money for what they believe is an imminent rainy day. Mawae says the NFLPA has also increased union dues in an effort to have a pot of money to dole out to players during a lockout year. The NFLPA even became the first professional sports union to hire an outside consulting firm, Texas-based Financial Finesse, to work with players on financial strategies, including ones geared toward preparation for a lockout.

Mawae points to the opposing huddle for evidence of where the owners stand. The league and its owners have hired Bob Batterman to represent them in the dispute. Batterman was hired to advise National Hockey League owners in 2004, right before that league's season-long lockout of players.

As the NFLPA's point person, Mawae's rhetoric could easily be excused as public relations maneuvering for negotiation purposes. But Carter, too, has few words of consolation for worried fans who fear the two sides won't get a deal worked out in time.

"As regards sports labor disputes, I have been so consistently surprised," Carter says. "Who would have really thought that all the saber rattling would have resulted in the NHL shutting down for a year? Who would have really thought that they would have canceled the World Series. I guess what's in the best interest of everybody involved isn't always what plays out in the short run."

To the Final Whistle

Kevin Mawae's legacy as a professional football player is secure, as is his wealth. And though he recently committed to playing another year (it remains to be seen if Mawae will finish his career in Tennessee or elsewhere), the soon-to-be 39-year-old knows his playing days are numbered.

What's more, Mawae's term as NFLPA president ends in March. If he wanted, he could walk away from the headaches involved in this looming labor struggle. Instead, he's asking his fellow professionals to let him remain in the job.

"The smart and prudent thing to do is keep leadership in place through the negotiation process," he says. Like any good football player, Mawae understands the value of keeping to one's assignment. "I can't see walking away at a time where we need to keep consistency at that position," he says.

In the end, Mawae may find himself in the middle of a battle where neither side wins. No matter which side one thinks is right, analysts like Carter think finding a way to avert play stoppage of a game that enjoys an $8 billion lifeline to its consumer matters most.

"Fans who are struggling financially and who feel further and further out of touch with the economics of sport may just get to the point where they say, 'A plague on all your houses,'" Carter says.

Though football would not be the first professional sport to ignore its fan base to its own detriment, city and state officials -- and especially the fans -- throughout the country hope it is not the next. Regardless of the outcome, throughout the negotiations, Kevin Mawae will be just where he has been his entire career: in the center of it all.

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