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Letter from defunct CWHL board long on blame for collapse, short on solutions

Three months after an abrupt decision to shut down operations, the CWHL distributed an open letter detailing the sequence of events that led to the decision. But still, there are more problems than solutions.

Three months after an abrupt decision to shut down operations, one that left hundreds of the best women’s hockey players in the world without a place to play, the Canadian Women’s Hockey League distributed an open letter to fans, sponsors, donors and the Canadian government detailing the sequence of events that led to the decision.

The letter, written by CWHL Chair Laurel Walzak on behalf of the board, points to a host of factors that led to the decision. There is a lot of reasons given – a rival league, a lack of sponsorship, rising costs among them. “With new management in August, 2018 and a new Board of Directors in November, 2018, many might ask why did this group could not solve these problems?” the letter read. “The reality is we were working on it, while at the same time the marketplace was expressing desire for a new model where they could achieve a higher return on their investment.”

The letter also says: “The closure of the CWHL – while significant – will be a small bump in the continued growth of this amazing and competitive global sport.”

Hundreds of players in Canada, USA and China were displaced because of the decision, while 200-plus players formed a players’ association and have elected to sit out this season, in part because of the closure of the CWHL.

There’s a lot of talk in the letter about what is best for the women’s game, which is all well and good. In fact, the letter clearly spells out that it believes one league is critical to the women’s game. “It is time for the business side of the women’s game to be elevated and take a new direction,” the letter says. “This is where the Board of Directors 100 percent supports the players in their movement for one truly sustainable league.”But here’s the thing. When you take over a business, even a not-for-profit one, as a director or commissioner, your duty is to do everything possible to ensure the growth and success of the business, not do what is best for the industry as a whole. And shuttering the CWHL, in an effort to create one league funded by the NHL, is what many people think is best for women’s hockey.

As for that financial picture, the league says in the letter that to run the league adequately, it would require $5-6 million in revenue, and $10 million to do it professionally. The league reported in 2017-18 it had $4.2 million in expenses, but does not list its revenues. In a separate CWHL income statement given to board members on Nov. 6, 2018, and obtained by The Hockey News, the document states the league generated $3.45 million in revenue in fiscal 2018 and incurred $3.2 million in expenses for a surplus of nearly $205,000. There is a discrepancy of nearly $1 million in operating expenses between the two numbers. A call to the CWHL to explain the difference was not immediately returned.

The league said it found it difficult to find sponsors willing to inject cash into the league and the emergence of the National Women’s Hockey League in 2015 fragmented the market. The league lost one of its China teams, which further depleted revenues, and added $600,000 to its expenses to provide “a modest stipend” for players. The letter says that the league could not go private or merge with a for-profit league because of its status as a Registered Canadian Amateur Athletic Association. It also said there were two offers to purchase the league, but neither offer assumed the league’s liabilities and were turned down, “as they were not in the best interest of players, contractors and creditors. No other formal offers to capitalize the league were received.”

The letter then goes on to make a number of suggestions of what must be done to move the women’s game forward, but almost nothing in terms of how that would be achieved. For example, it says, “people who approve the allocation of investment and sponsorship dollars must move a significantly larger portion of their spend to the women’s game,” and that the pay gap between professional men and women players must be addressed. “Successors to the CWHL must find a way for the best women to earn a full salary,” it says. “We keep hearing it is not about the money, but it is about the money, the revenues, the investments, the profits and so to truly advance this game, settling for a non-living wage to play this game ‘professionally’ should not be tolerated.” As the kids say, “Well, duh.”

Finally, the letter makes a last-ditch plea to all the stakeholders to do what is necessary to build one professional league for women players. “So please, everyone, and particularly those in the hockey and business community, come together with a new solution, fix the business model, and allow the spectacular on-ice game played by our women heroes to flourish in a manner that continues to put the game on the world stage, while being an inspiration to young women everywhere,” the letter says. “The time for change is now.”

The full letter can be read here.

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