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'Canes wait as players, owners settle gripes

At the RBC Center in Raleigh last Sunday, local fans should have been settling in to watch the 5 p.m. start of the Carolina Hurricanes taking on the Calgary Flames. Instead, locals were lined up hoping to receive one of this year’s elusive flu shots as an eight-hour health clinic ended.

The voice of Hurricane radio announcer Chuck Kaiton can currently be heard at the Crooked Creek Golf Club in Fuquay-Varina, N.C., announcing tee-times, rather than reverberating over the airwaves to Hurricanes fans.

Instead of taking the ice in Raleigh, Hurricanes right wing Pavel Brendl is now skating on another continent for the Malmo club of the Swedish Elite League.

Since Sept. 15, the National Hockey League’s season has been put on hold until the league and the NHL Players’ Association reach a new collective bargaining agreement.

The previous 10-year bargaining agreement governed interaction between the owners, whose revenue grew 173 percent over that time, and the players, whose salaries increased by 261 percent. Currently, the NHL puts 75 percent of its revenue toward player salaries, the highest proportion in professional sports.

“The division between where we are and where we want to be is too high,” said James Cain, former president and COO of the Hurricanes, said at a panel on labor strife and economics in hockey at the Duke School of Law.

The former Hurricanes executive, who is now a partner at Kilpatrick Stockton LLP in Raleigh, said a luxury tax would not fix the current economic situation in the NHL because the number of “have-nots” outnumbers the “haves.” Instead, he argued, a salary cap is the only solution.

Since Gary Bettman became the first commissioner of the league in late 1992, there has been an increase in the expansion and movement of franchises. Under Bettman’s reign, four franchises have moved to new markets and eight teams have been added.

The Hurricanes moved from Hartford, Conn., to Raleigh before the 1997-1998 season. In its first two years in North Carolina, the team played in Greensboro to crowds averaging 6,000 and lost $55 million.

There are only about seven or eight teams in the league that make money, Cain said. The $130 million Hurricanes franchise has lost $100 million in the last five years.

As Dallas Stars President James Lites described, the NHL financial situation has been “a train wreck waiting to happen.” After three negotiation periods failed to produce a new labor agreement, Jim Rutherford, president and general manager of the Hurricanes, and other team executives around the country announced ticket options for season ticket fans.

The Hurricanes have given season ticket holders five options in the face of the current lockout that range from continued investment in 2004-05 to a full refund.

“We really would like to make sure our fans know that we’re alive and well,” said Peter Karmanos, Jr., the Hurricanes’ owner. “We’re working hard to get the economic system right.”

In addition to financial options, the Raleigh franchise has also given fans the opportunity to learn about the league’s ongoing labor negotiations.

Last month, the Hurricanes hosted a town hall meeting for fans to ask questions about the labor situation. Karmanos and Bettman, who was a late addition to the event, answered questions from about 1,000 Hurricanes fans. The concerns ranged from why there are no labor meetings scheduled to the future of the Hurricanes franchise.

Bettman negated the possibility that the league may reduce its size, especially in areas that are not traditional hockey fan bases—including Raleigh, which Bettman called “a terrific market.”

Last season, the Hurricanes averaged 12,086 fans at the RBC Center, which seats 19,000 for NHL games.

“We are not considering contraction,” Bettman said. “We have not, we will not, and we do not believe in contraction. With the right economic system, all 30 of our clubs can be healthy and competitive.”

The current lockout is the third work stoppage for the NHL. The first came with a ten-day strike in 1992. During the 1994-1995 season, the league suffered a 103-day lockout that cancelled 468 games.

With the current work stoppage more than two months old, the NHL has canceled this season’s All-Star Game set to take place February in Atlanta. The next cancellation could be of the entire season.

“We’re a stubborn little sport,” Lites said.


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