The amendments to the Allowable Player Payment caps will take place across two stages, affecting local teams Benalla All Blacks and Goorambat.
AFL North East Border - which is the regional administration centre for the OKFNL - announced the decision last week.
“Following a series of recent meetings involving the AFL and all state and territory CEOs, and state football operations representatives, recommendations have been made in relation to salary caps and player payments in community football to help ensure the survival and ongoing sustainability of community football clubs in 2020 and beyond,” AFLNEB region general manager John O'Donohue said in a memorandum addressed to leagues, clubs and umpires.
“These recommendations have been made whilst considering feedback from the AFL Victoria Club Sustainability Working Party and metropolitan leagues across the country.
“These changes are part of a broader AFL industry response to the Covid-19 pandemic, to reduce community club costs in line with reduced revenues, to ensure the sustainability of our community clubs and our code into the future.
“The AFL North East Border Commission at its scheduled meeting on Wednesday, April 15th, 2020 moved to adopt the AFL National Community Football Recommendations on Salary Caps and Player Payments for the2020 season which will now apply to all affiliated AFLNEB leagues.”
Salary caps will be immediately slashed by 50% - dropping the OKFNL from $70,000 to $35,000 - while further reductions will be made once a post-pandemic fixture is locked in.
A 15-game season in the OKFNL would see a salary cap of $29,160, while a six-game season would be played with a cap of $11,964.
It is expected the 2021 cap would also be affected.
“It is important to note that the APP caps are not an aspirational nor required spend, and clubs are able to continue spending below the designated APP cap for their relevant competition,” O'Donohue said.
“At this stage, due to the anticipated financial impact on community clubs for years to come, it is proposed that there will be a reduction in the APP that will be carried through into the 2021 season.
“This position will be reviewed and confirmed later in 2020, as the impact from Covid-19 becomes apparent at which time a consultative process will occur with clubs and leagues.”
It means clubs will need to re-negotiate player contracts.
It is also expected that AFL Goulburn Murray - administering Benalla's Goulburn Valley League and Violet Town's Kyabram District League - will make an announcement on its relevant salary caps in the coming weeks.
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