[BostonCard]

As far as the market rate goes, I wonder how the market rate is set?  Who is to say whether being in an ESPN ad is worth $1M or $2M?  ESPN gets to set that.   I suspect there will goldrush into the laundry business, and ESPN is ideally set up for that.

This is where the transparency and having a database helps.  I work in an industry where there is also concern about funneling excessive money ostensibly for legitimate business purposes as an inducement, and whenever I enter into a contract with a consultant, it has to be reviewed by our compliance office and the value has to be compared to a fair market value table.  If the negotiated rate comes in outside of the FMV range, then I have to justify the variance.  Sometimes it's easy because the consultant has very specific knowledge not available elsewhere and the published FMV rate doesn't capture their value, and the scope of work documents that they are one of the few or the only person who can fulfill the criteria; sometimes the consultant will produce documentation that they've entered into similar industry contracts.  Other times I'll have to ask the consultant to modify their rates and if they are unwilling to then tell them we can't sign the agreement and look elsewhere.  It is clunky and a pain, but was born out of past abuses where contracts were entered with excessive values that didn't serve a legitimate business purpose were used as a cover for illegitimate purposes.

As I understand it, under the House agreement this will be handled by an independent committee, which will likely look at similar contracts elsewhere to decide if the player is receiving fair market value.  I don't think it will be a problem if an ESPN ad gets paid within a certain range, which may be quite broad, but if ESPN ads are going for $1M - $2M, and a star QB gets a $5M contract to film an ad for the Longhorn Network (as an example) that might be flagged as excessive.

BC

[BostonCard]

As far as the market rate goes, I wonder how the market rate is set?  Who is to say whether being in an ESPN ad is worth $1M or $2M?  ESPN gets to set that.   I suspect there will goldrush into the laundry business, and ESPN is ideally set up for that.

This is where the transparency and having a database helps.  I work in an industry where there is also concern about funneling excessive money ostensibly for legitimate business purposes as an inducement, and whenever I enter into a contract with a consultant, it has to be reviewed by our compliance office and the value has to be compared to a fair market value table.  If the negotiated rate comes in outside of the FMV range, then I have to justify the variance.  Sometimes it's easy because the consultant has very specific knowledge not available elsewhere and the published FMV rate doesn't capture their value, and the scope of work documents that they are one of the few or the only person who can fulfill the criteria; sometimes the consultant will produce documentation that they've entered into similar industry contracts.  Other times I'll have to ask the consultant to modify their rates and if they are unwilling to then tell them we can't sign the agreement and look elsewhere.  It is clunky and a pain, but was born out of past abuses where contracts were entered with excessive values that didn't serve a legitimate business purpose were used as a cover for illegitimate purposes.

As I understand it, under the House agreement this will be handled by an independent committee, which will likely look at similar contracts elsewhere to decide if the player is receiving fair market value.  I don't think it will be a problem if an ESPN ad gets paid within a certain range, which may be quite broad, but if ESPN ads are going for $1M - $2M, and a star QB gets a $5M contract to film an ad for the Longhorn Network (as an example) that might be flagged as excessive.

BC