In the last couple of weeks, the Las Vegas Aces have seen their team and management team in the news. Is it because they are the defending WNBA Champions? No. Is it because they recently signed two-time MVP Candace Parker? Not really. It’s because they are alleged to be paying their players.
Wait a minute. That doesn’t sound like a bad thing, but
there’s that word “alleged.” Candace Parker is making $95,000 less than she did
a year ago. But maybe she’s just trying to win a title. Money isn’t everything
and $95,000 doesn’t seem like a lot of money to lose out for a professional
athlete.
Except, $95,000 in the WNBA is a lot of money. The league has
a salary cap of just $1,420,500 in 2023. it’s easy to see how much money that
is. That amount is equal to 6.69% of a team’s full salary. So good on Parker for
chasing a title. Where’s the scandal in that. The scandal is in it that the
Aces are accused of paying their players under-the-table, through third
parties, and, thereby, circumventing the salary cap.[1]
There’s a lot to this story. There’s the fact that the WNBA
has a minimum salary, or floor, that teams must adhere to ($1,188,990); 50-50
split of incremental revenue; and even the way that the WNBA has different salary
brackets for different levels of WNBA players such as rookies and veterans[2].
But, what does it matter? What’s the impact to fans? The
impact is in competition.
The NBA has a very similar structure to the WNBA, but they
are scaled way up, with a salary cap of $123,655,000[3].
The NFL has a salary cap of $224.8 million in 2023[4].
The NHL has a cap of $82.5 million[5].
MLB is the only team without a hard cap, implementing instead a competitive balance
tax (currently $233 million) that charges teams for spending over the tax
threshold by 20% the first year, 30% the second consecutive year, 50% the third
consecutive year and, depending on how far over the threshold a team goes,
either a 12%, 42.5% or 60% surcharge as well as possible draft pick penalties[6].
All the systems are complicated in their own way. For
example, injuries factor into most caps to some degree. There are exceptions
built-in to caps to help teams dealing with injuries. There are ways to go over
the cap, such as the concept of cash-over-cap in the NFL that essentially
allows teams to kick possible cap penalties into the future when the cap will likely
be higher and, therefore, the penalties less impactful[7].
But why would you want to pay players more than the cap if
you’re goal is to make money? The answer is simple: winning makes money. The
top five teams in the 2022 Forbes breakdown of most valuable franchises are the
Dallas Cowboys, New England Patriots, Los Angeles Rams, New York Yankees and
New York Giants[8]. You
may be thinking to yourself that those teams don’t seem to match the winning,
but let me assure you that they do. Dallas has five championships, New England
has six, Los Angeles has one (the other was in St. Louis) that came last year,
the Yankees have 27, and the Giants have 4. That’s 43 titles between them, 16
for the NFL franchises alone. Even if some of those are a decade or two old,
the legacy of winning lingers. The Chicago Bears are sixth on that same list, despite
just one championship. But sometimes winning isn’t just about winning titles. A
long history of winning and being competitive and in the hunt helps. See the
Cowboys over the last 20 or so years. No real threat to the championship, but enough
success that fans can believe in them.
There’s been a lot of talk recently about a salary floor in MLB.
Of the 30 teams in MLB, 16 of them are under the league average going into the
2023 season, and nine of those teams are likely to pay players less than $100
million combined[9].
In 2022, MLB exceed $10.8 billion in revenue for the first time ever, and,
according to the MLBPA, saw players making roughly 54.80% of total revenue as
of 2018[10].
Looking at the WNBA, there are 12 teams. In 2018, the WNBA
brought in close to $60 million in revenue. If the WNBA cap was maxed by all
teams, they would spend a total of $17,046,000, or just 28.41% of total
revenue.
While the question of whether sports should be worth as much
money as it is, let alone individual athletes, is a fair one, it’s not the
central point to the issue at hand. So what take aways are there from the Las
Vegas Aces?
1)
It’s never okay to cheat. If the Aces did circumvent
the cap, they need to be punished in a meaningful way.
2)
Players risk their own health and safety being
the ones on the court, pitch, field, ice, etc. They should, collectively, make
more than the owners who are not risking injuries.
3)
The WNBA needs to fix their profit sharing system.
While the 50-50 split of incremental revenue is a step in the right direction,
players should not be making just more than a quarter of league revenue. Half
or more of actual revenue must happen.
Teams can’t cheat. It’s a question of morals, ethics, and a
level playing field. However, those that try to find loopholes to win are at
least aware that winning is profitable and long-term winning is invaluable.
[1] https://www.cbssports.com/wnba/news/las-vegas-aces-being-investigated-by-wnba-for-under-the-table-payments-per-report/
[3] https://www.nba.com/news/nba-salary-cap-for-2022-23-season-set-at-just-over-123-million
[4] https://www.pff.com/news/nfl-salary-cap-tracker-2023-offseason-free-agency-all-32-nfl-teams-ranked-cap-space#:~:text=All-,2023%20NFL%20Salary%20Cap%20Tracker%3A%20All%2032,teams%20ranked%20by%20cap%20space&text=The%20salary%20cap%20for%20the,increase%20over%20the%202022%20season.
[5] https://www.nbcsports.com/boston/bruins/montreal-canadiens-lead-2023-nhl-salary-cap-space-team#:~:text=2022%2D23%20season%3F-,The%20NHL%20salary%20cap%20maximum%20for%20the%202022%2D23%20season,the%20league%20in%20three%20years.
[6] https://www.mlb.com/glossary/transactions/competitive-balance-tax
[7] https://profootballtalk.nbcsports.com/2021/02/27/cash-over-cap-becomes-viable-solution-for-coming-2021-salary-cap-crunch/
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