As regular readers know by now, one of my lockout soap box issues has been the requests for season ticket payments at a time when the NFL can't guarantee a full 2011 season. The league announced last year that full refunds for any canceled games will be provided within 30 days from when the league determines how many games will be played.
I've referred to that approach as an interest-free loan to cash-strapped owners during a lockout. A true gesture would be delaying payment until after a collective bargaining agreement is reached, but it appears some teams have recognized the extent of their request.
Over the weekend, three NFC North teams informed season-ticket holders of plans to offer some level of simple interest as a part of any refund. The amount literally could end up being pennies, but I guess you could consider it a modest gesture of acknowledgement for holding the cash of your best customers for six months or more.
Thanks to a few loyal readers and some other assistant NFC North bloggers, I've gotten a look at the communications from all four teams. The Chicago Bears were the only team that did not mention interest, and my understanding is they have no plans to offer it. (Based on the loose change likely to be involved, I wouldn't make too harsh of a judgment against the Bears for it.)
The Detroit Lions' letter, written by president Tom Lewand, includes this passage: "In the event any games are canceled, be assured we will provide you with a full refund, with simple interest, for any cancelled preseason or regular-season home games. We will provide you with the details of the refund program at the appropriate time should it become necessary."
The Green Bay Packers' letter had similar phrasing, indicating more details would arrive this summer if there is still no CBA. In the end, the Packers and Lions could follow a plan set forth by the Minnesota Vikings, who committed to paying at an annual 1 percent rate starting from the date of the canceled game and continuing until the refund is processed. To qualify for interest, season tickets must be paid in full by May 23.
As we've discussed, many of you are mulling competing factors in deciding whether to renew season tickets. Some of you don't want to support a lockout. Others don't want your money being used as a financial cushion, even if temporarily, while a work stoppage continues. And many of you, especially in Green Bay and Chicago, know that passing on tickets now will put you at the back of a long line when football eventually returns.
So in that sense, teams that pay interest aren't asking to hold your money completely for free. And a 1 percent annual rate is competitive with, say, the interest rates you would get if you put that money in the bank or even a money market account.
But practically speaking, it's much more of a gesture than a windfall. I'm no financial genius, and so we'll talk in nice round numbers here. If the cost of a ticket is $100, and the refund isn't processed for a year after the game was originally scheduled, you'll make $1 interest on the first game and less than $10 for the entire season.
Again, I don't know what interest rate the Lions and Packers would use. I don't know if any games are going to get canceled or how long the 2011 season would take to resolve if they are. But gesture or not, the basic fact remains: Those who renew season tickets are providing a (nearly) interest-free loan for a business in lockdown.