USA Today, August 3, 1986
It was a celebratory scene when the 16 USFL Owners met for their annual summer meeting in New York, and who could blame them. The league, having won its anti-trust suit against the NFL is now on a better footing than ever and funds from the $675,000,000 finding will start arriving in USFL coffers within the year. Of course this does not immediately eliminate the issues the league must address, but there was a lot of positivity in the room as owners discussed and decided on league funding, relocation of two franchises, expansion in 1987 and new rules. There was a lot discussed, and some major decisions made at the 6 day conference, so let’s get right to it.
ANTI-TRUST FUNDS
The league voted to distribute 60% of the 3-year NFL fund distribution to franchises, with the current 16 teams receiving $14 million each in 1986, but with expansion teams to be added in 1987 (see below) the payments would shift for years 2 and 3, with each of the 16 current teams earning $15 million in 1987 and $14.5 million in 1988 as the expected expansion teams would each earn $8 million in 1987 and $12 million in 1988.
The remaining 40%, or nearly $270 million over 3 years, would be retained by the league for three projects. 20% will be used for leaguewide operations, marketing, and investment in sponsor development. 15% would be directed towards capitol projects, with a select committee to determine which cities would be funded for assistance with stadium upgrades or other logistical support, and the final 5% would fund the league’s central office, with increased staffing for everything from rules review to NFL outreach.
Not all owners were on board with a 60/40 split, but the case was made that by leaving significant funds within the league office, support could be provided on a needs-based formula, meaning that teams in expensive markets such as NY or LA could get support for the additional overhead, while teams with lagging attendance could get additional marketing support. The ability for both strong and weak teams, as well as large and small markets to tap into the additional funds helped the final formula pass by a 13-3 vote.
SALARY & FREE AGENCY
The league owners approved a salary cap increase from $30M per team to $35M, also granting a 4th exemption player to each team. It is clear that one of the strategies of the league is to reinforce their ability to sign NFL midrange talent and top collegiate stars through competitive salary structures. Adding the 4th exempt player to each squad may also allow some franchises to make a run at higher end NFL talent.
With an anticipated player battle with the NFL over the next 3 years, as USFL contracts expire and the NFL negotiates a new collective bargaining agreement with its players, the USFL owners discussed strategies for retaining talent and discouraging NFL poaching. It was agreed that incentives would be built into contracts for renewal during the final year of the contract and that teams would be allowed to use annuity structures to enhance the financial viability of long-term and high-end contracts. While these rules do not come in time to avoid some NFL poaching this off-season, it is hoped that the 1986 and 1987 offseasons will see most USFL stars already renewed with 2nd contracts rather than playing the open waters of NFL-USFL free agency.
USFL DRAFT
The owners agreed to some alterations to the draft format. For 1986 the number of protected territorial schools for the league’s unique Territorial Draft would be reduced from 5 to 4, and the number of T-Draft rounds would also drop from 6 to 4. Balancing this is an expansion of the Open Collegiate Draft from 7 rounds to 9. The league, hoping to cash in on a more national audience, appears to be moving away from protected regional picks, always tricky particularly for the teams in the NorthEast due to the lack of major college programs in that region of the country. While owners stated that they do not expect to ever fully abolish the T-Draft, it seems clear that they wish to create better balance and a way to do that is by increasing the value of the Open Draft, especially as they look to add more teams.
EXPANSION & RELOCATION
The topic of expansion was huge going into the week, and the news was equally huge coming out of it. First off, the owners quickly confirmed the assumption that the relocated Blitz and Breakers franchises would swap divisional assignments. Baltimore’s Blitz now move to the Atlantic Division, while the now New Orleans Breakers join Houston, Michigan and Pittsburgh in the Central Division. The relocation means that the two 1986 USFL Championship, the Stars and the Blitz, would now be divisional foes. One can only imagine that the happiest team in the league is Michigan, which loses a major divisional foe and gains an 8-8 Breakers team. New Jersey and Washington are likely the least pleased by the shift as they now must battle with both Philadelphia and the Blitz twice a year.
With the relocation finalized and optimism abounding about the potential for higher revenue in both the Charm City and the Big Easy, and with ABC/ESPN agreeing to the relocation, the league owners then shifted to the anticipated 1987 expansion. As part of the television deal it was agreed that Chicago would require a replacement squad for 1987 and the league has already begun extended talks with several parties who, reluctant to buy the Blitz, seem more open to developing their own franchise.
It was expected that the USFL would add a second team to the expansion to retain balance between the two conferences and an even schedule with only 1 bye week per team. What emerged from the meeting is a clear sign that the league is feeling flush with confidence after the victorious anti-trust suit against the NFL. Commissioner Chet Simmons outlined a more aggressive expansion plan which will bring 4 new franchises to the league in 1987. Simmons specified that there would be a two phase expansion process, with open competition between proposals leading to an 8 bid finalist round this autumn.
The expectation is that the league will include two Chicago bids in the 8 finalists as well as 6 bids for different cities, leading to the 4 team expansion. Simmons cited a desire from league owners to retain a 4 division format, with each division moving from 4 to 5 teams as the league expands to 20 franchises. Just how this will be executed will depend, according to Simmons, on the locations of the new USFL franchises. Simmons would not rule out the restructuring of the league or possible shifting of existing teams to new divisions depending on the breakdown of the 3 additional cities that would join Chicago in the 1987 expansion. While no owners within the expansion committee would go on the record about bids already received, it appears that they have already been in communication with ownership groups proposing franchises in San Diego, San Antonio, Miami, Seattle, Atlanta and Kansas City. USFL Championship
USFL CHAMPIONSHIPS
And finally, almost as an aside from the league, it was announced that the 1986 USFL Championship would be held at the Gator Bowl in Jacksonville, while the 1987 Championship has been awarded to the AstroDome in Houston. Jacksonville seems a natural choice since the Bulls have led the league in attendance for two seasons. Houston, while no slouch in attendance, provides the league with the option of a daytime game, since the temperature-controlled AstroDome does not require the league to avoid scorching hot July weather common to many of its franchise homes. I think it is safe to say that this argument may mean that Arizona’s Sun Devil Stadium will not be hosting a championship any time soon.
Well, there you have it. Big news on expansion, Anti-Trust funds, Free Agency, the Draft and Relocation. With discussion of a fall season done for now, and flush with both confidence and cash after their lawsuit victory, the USFL is ready to make a run for the long haul, to rival the NFL in more profound ways, and to make football a year round institution.