The Fish that killed Miami

Somewhere along the way, Jeffrey Loria lost the script. It was fairly simple, really. An owner of a “poor” franchise kept his house in order and received revenue sharing checks until he built a new ballpark. Then when the new ballpark money started rolling in, the franchise would be healthier, the team could significantly reduce if not completely eliminate its revenue sharing take, and the owner could spend as much as he wanted. That’s how it worked in Minnesota and Washington, that’s how it would work for the other teams that hadn’t gotten new parks yet.

The unwritten rule of all of this is that Loria could also spend as little as he wanted, even with a new ballpark. Last December, Loria kicked off a free-spending phase that last all of seven months. He had Larry Beinfest trade for Jose Reyes and sign Mark Buehrle, Ozzie Guillen, and Heath Bell. The Marlins were in the running for Albert Pujols and lost out when they refused to include a no-trade clause. As the Marlins sputtered towards the All Star Break, Loria gave up on his high-roller mode and set Beinfest out to go into fire sale mode. Hanley Ramirez was first to go, then Gaby Sanchez and Edward Mujica. Loria and stepson David Samson saved the best for last with this week’s blockbuster trade of – well, all of their veterans – to the Blue Jays for clubhouse cancer Yunel Escobar and prospects. While Giancarlo Stanton is expected to stay put because he’s good and cost-controlled, Ricky Nolasco and Logan Morrison may also be on the outs. If they were traded, the Marlins’ 2013 payroll could be under $20 million, unless Commissioner Bud Selig steps in and forces the Marlins to add a bunch of veteran one-year contracts. As for the big trade that made so many in baseball angry, Selig is reviewing it and while he’s angry, so far he sees no reason to rescind the deal.

It’s not so much the trade itself that’s revolting, it’s the circumstances surrounding the trade. Already, many in Miami and within baseball had reason to be suspicious of Loria, who ran the Expos into the ground and ran the Marlins on the cheap when he acquired his current team. Dealings with municipalities became so rancorous that Samson had to become the frontman in stadium discussions and Selig had to send in Bob DuPuy to negotiate the deal. Somehow the City of Miami and Miami-Dade County were swindled as so many municipalities had in the last 30 years

Other sports that have salary caps also have salary floors, making it difficult to pull off fire sales of this magnitude. Thanks to the lack of a salary floor, there will probably be two teams in 2013 – the Marlins and Astros – whose payroll will be lower than any payroll in the other three major sports. Yet MLB will also have 5-7 team payrolls that are higher than anything in the other three major sports. The economic system in MLB not only allows this inequity, it promotes it among its ranks. Selig can talk all he wants about greater competition including low-revenue teams, but in the end the four LCS teams all had payrolls above $110 million. On the other end, the Marlins have no incentive to wean themselves off the revenue sharing teat because they, as a small market team, are entitled to revenue sharing under the current CBA. In revising the agreement, MLB went to pains to define big markets and small markets, ensuring that teams in the top 15 markets all transition off revenue sharing.

From the current MLB CBA, Attachment 26 – a list of teams in order of market size and their yearly revenue sharing status. Miami is 23rd, Oakland is tied for 7th with San Francisco.

Should the trade be approved, Selig could get punitive and take away some amount of revenue sharing money due to the Marlins next month. Since there’s no proper mechanism for redistributing or reallocating the funds, what will probably happen is that Selig will push Loria to end the fire sale at this point and then spend $20-30 million on veteran free agents who could round out a roster. It won’t do anything to heal the relationship with fans or lure premier players whose agents are rightfully suspicious of Loria. It will, however, give off a sheen of “trying” when it’s clear that Loria definitely isn’t. He must have learned to cut bait early when he tried to parlay the 2003 World Series win into multiple playoff appearances. The NL East proved tough sledding with a rebuilt Phillies squad and evergreen Braves team in competition. The Marlins finished 2004 and 2005 with above-.500 records, yet finished well back in the East. One recent suggestion has been to strip the Marlins of the 2015 All Star Game, which would be fair. The Game is a team’s reward for successfully building a stadium. Reassigning the game or postponing it for a few years is a reasonable punishment, though it pales in comparison to more punitive and less feasible actions such as engineering a franchise sale.

So yes, Loria will get a wristslap at worst. He’ll lose revenue at the ballpark for certain, especially if attendance dips below 20,000 per game as it was prior to Marlins Ballpark. Lost revenue could total $30 million. No one’s going to cry for him. Assuming he gets $40 million in annual revenue sharing, he’ll pull $85 million from MLB without selling a single ticket. In 2014 that will go up to $100+ million because of new national TV deals. Rent is incredibly cheap at $2.4 million. Loria can bide his time and let a rebuilding team move its way into contention, at which point he and Samson can try to convince the public and players that things will be different this time around. Once bitten, twice shy.

Reaction from the Marlins trade should have long resonating impact on efforts to build ballparks in the two Bay Areas, but I wouldn’t count on it. The differences between the Tampa and Oakland situations and what happened in Miami are vast. The Rays have fielded competitive teams for a long time but are locked into a lease at Tropicana Field, as well as the City of St. Petersburg because the mayor won’t allow the team to expand its search to Tampa. The A’s were competitive this year and have a bright future, but ownership also wants to look outside Oakland and is being prevented from doing so by the cross-bay Giants. Lew Wolff wants to self-finance the ballpark to avoid dicey public funding measures. By ratifying the new revenue sharing market definitions, Selig and the other owners are pushing for the A’s to get off the dole. Given the size of Tampa Bay market, it would seem that the local economy couldn’t capably support a privately-funded stadium. This memory will remain fresh if the respective owners or the commissioner play ransom when the CBA ends in 2016. Still, you can’t discount the collective ability of pols to buy into a bad deal. It happened in Miami, it happened in Oakland not too long ago, it’s happening in El Paso now.

It’s too bad this stadium business is so expensive. Teams that build their own stadia have the most incentive to remain competitive, to spend on payroll, to win. They don’t have gigantic subsidies to fall back on. If more teams went that route, we might have fewer instances like this Miami mess. And competition would be real, not a farce.

25 thoughts on “The Fish that killed Miami

  1. I think people are overreacting to it a bit. The Marlins finished dead last, and they were not projected to be very good on paper this year. That context is very important.

    We should definitely criticize owners that don’t open their wallets when their team is at the top of the Win Curve. But given where the Marlins are at, and where they are projected to be this season, trading away expensive players for prospects is justifiable.

    If the Giants don’t fill their second base void, or the A’s don’t fill their shortstop void, or the Braves don’t get a viable center fielder this offseason, those three things would be unjustifiable. Because those three teams are currently at the top of the win curve, where having a 2-3 win player instead of a replacement-level SS, 2b, or CF is potentially the difference between making the playoffs or not.

    If any of those three teams don’t open the wallet enough to have a viable solution at those positions by spring of next year, that would be worse than what the Marlins just did. As a fan, I am totally fine with an ownership group making money as long as they are willing to spend money when a contention window opens up.

    And, connecting this back to the A’s, when the A’s do indeed finally get a new stadium, I hope that they still trade away established players for promising prospects in non-contention years. That’s just smart GM’ing, IMO, whether you are in a new stadium or not, publicly subsidized or not.

  2. re: when the A’s do indeed finally get a new stadium,

    …that may not be for many, many years and in some other part of the country. I’m anticipating more stalling from Selig, at which point Wolff says his efforts to get a new ballpark are over. He then parks the team at the Coliseum for many more years. What happens after that? Not even worth looking that far into the future.

  3. Wait… so this document is part of the CBA… and it lists the A’s and Giants as TIED with the 7th largest market? Isn’t this an admission by MLB that San Jose is SHARED between the two teams???

  4. @Darren – Sure seems like it, doesn’t it? Notice how WSH and BAL are separate?

  5. Not sure about that guys. Boston, Philly and Toronto are all tied at 9 as well.

  6. @Dan,
    But Boston, Philly and Toronto aren’t separated by a couple of miles of water either. The 7th largest market is obviously SF, OAK…AND SJ! Kind of throws cold water on the idea that the A’s will wind up in SA/another part of the country nonsense.

  7. If they aren’t considered combined, then someone needs to explain why they feel that Alameda/Contra Costa Counties == Marin/SF/San Mateo/Santa Clara/Santa Cruz/Monterey Counties.

  8. Selig showing again why he such a rat bastard.

    He colluded with Loria and Samson in Montreal to get the team to move. In 2003 the Expos in Aug 28th were tied for the wild card and Selig refused to let then expand their roster to 40 in September. Causing the team to fall off.

    Of course Selig gets a free ballpark in Washington DC from the taxpayers and now look at what these 3 stooges have done in Miami, ruined the market.

    Selig will not help the A’s unless the ballpark is publicly financed. He is praying for Oakland to pay for it or even San Jose or San Antonio.

    Miami is first hand evidence on why Selig is the worst commissioner of all the major sports with Stern and Bettman right behind him in that order.

  9. The difference between territory and market is interesting. Hell, the A’s are marketing to you guys down in Santa Clara Valley. So the unusual territorial division of the Bay Area market makes no sense. The top three markets have two teams sharing the territory within their markets.
    .
    Keep one other thing in mind, however: Not only does the mlb constitution require 3/4 vote of the owners to amend the document (e.g., a change in territorial rights); that agreement also requires 3/4 vote to approve any team’s “relocation.” Moving from Oakland to San Jose looks like “relocation” to me. By way of analogy, although the Dodgers and Angels share the huge territory of “Orange, Ventura and Los Angeles Counties,” I do not believe the Angels have the unilateral right to build a new ballpark in Burbank.

  10. Funny to hear usually together Selig drop an f-bomb after being asked about the A’s SJ situation.

  11. xoot, I think you are wrong on the second point. A team can move freely within it’s territory. If there was a 3/4 vote to unify the Bay Area (just for arguments sake) then either the A’s or Giants could build a stadium anywhere within the territory without another approval required by the owners. Though I feel like I remember there is also some rules around how close the stadiums can be to one another. So if the Giants wanted to build a stadium in the coliseum parking lot, they couldn’t do that over the A’s objections (I know, an absurd scenario, just using to illustrate). I believe that distance limitation is 5 miles, but I might be confusing that with another rule that limits territories to two teams at most.
    .
    In other words, the way i understand it to be, moving requires leaving the defined territory. That includes the Angels moving to downtown LA if they want.

  12. re: Selig will not help the A’s unless the ballpark is publicly financed.

    …Correct. Remember how MLB held out for full financing in DC? What do you think of the “here’s a piece of land, you pay for the rest” stances in San Jose and Oakland? He’ll let the team go to San Antonio in a flash if San Antonio offers to pick up even half the tab.

  13. As far as markets go, I think we all can admit it is absurd that the the Bay Area is “split” as a territory. But, if the scenario above doesn’t take into account the stadiums location, but is in reference to where actual ticket buyers live, radios tuned in, televisions turned on and with the potential to watch a specific team… The A’s and Giants do have an identical market (or nearly so).

  14. LoneStranger
    November 15, 2012 at 4:54 PM (Quote)
    “If they aren’t considered combined, then someone needs to explain why they feel that Alameda/Contra Costa Counties == Marin/SF/San Mateo/Santa Clara/Santa Cruz/Monterey Counties.”
    .
    No kidding….
    Alameda/Contra Costa = 2,559,296
    Marin/SF/et al = 4,235,167
    (2010 Census Data)
    .
    yeah… CLEARLY that’s a tie.

  15. @jeffrey- agree with that possibility – believe they use a 35 mile radius- would pretty much say SJ is untapped territory- which is a very valid argument-

  16. So can we all stop using “Montrealization” as a reference to some baseball sabotage conspiracy now that it’s clearly a Loria issue?

  17. Jeffrey nailed it. Location of actual ballparks aside, the A’s and Giants share the entire 7 million residents +. Nothing prohibits Giants games from being shown in Alameda County, 95.7 from being aired in Santa Clara County, a San Mateo resident from crossing a bridge to see an A’s game or a Fremont citizen from going north to AT&T Park. Some of you are far to fixated on county lines, supposed metro areas and what the census burea has to say. Reality: we’re all one, big happy metro area (at least some of us are happy…)

  18. @Dan – The Greater Toronto metro has 6 million residents. So does Philly. Boston’s MSA has 4.5 million, CSA has 7.5 million. I’d say they’re comparable.

  19. I do not believe the Angels can move close to Chavez Ravine. I’ve never heard of the “35 mile radius.” Cite some authority, please.
    .
    “Relocation” certainly applies to Montreal-D.C., etc. But there’s no reason why that commonl word does not mean exactly what it says in the contract/”constitutiion,” unless it’s defined specially elsewhere. I haven’t found such a special definition anywhere. If you know otherwise, cite your authority.

    • @xootsuit – Any team can move within its territory without requiring a vote of the owners. That would’ve been the case with a Fremont move. The Angels’ territory includes all of LA and Orange Counties, so they could move anywhere from Laguna Niguel to Downtown LA to Pasadena if they worked out a deal.

  20. Xoot- your wrong- Angels can move to downtown LA and in act have had some discussions if the NFL falls thru

  21. Bill Shalkin reported on the Angels considering being an alternative to Farmer’s Field. For a multitude of reasons it wouldn’t happen, but not because it is a “relocation” and it wouldn’t require a vote of the owners to allow it to happen.
    .
    A perfect example of this is the Miami Marlins. They relocated from Miami Gardens to Miami with no owners vote. Teams are free to move to any place within their “district,” it’s only when they try to move outside of heir territory that a vote is required.
    .
    Other examples include the Rays looking to move to Tampa. That’s a relocation between cities within an existing territory.
    .
    The A’s annex love to Fremont. No owners votes necessary…
    .
    The territories have no bearing on any activity but stadium building. It’s the ky reason they exist at this point.

  22. Cite your authority. I think it’s in Major League Rule 1(a). (Not the playing rules, the league rules.) The 3/4 vote for “relocation” may not be necessary, but other approvals are. The “radius” rule is actually “5 air miles.” At least in the 2008 version of the Rules. Nonetheless, a team cannot decide unilaterally to move close to another team in a shared territory.
    .
    How do you think you know what was required to approve the Marlins’ move? If you have support, cite it.

    • @xootsuit – The LA situation was negotiated in 1961 when Gene Autry compensated Walter O’Malley. The territory has been codified and the Angels have already moved multiple times during their tenure. The rule you cite only affects a team that moves into another team’s territory. That “move” was already made. And what are these other approvals you’re talking about?

      (a) CONDITIONS TO RELOCATION TO ANOTHER CLUB’S TERRITORY.

      A Major League Club, in order to relocate within the home territory of another Major League Club, must comply with the following conditions:

      (1) The Major League Club intending to so relocate shall give notice of such intention to the Commissioner not later than midnight of October 31 of the year next preceding the first year it proposes to operate a second Major League Club in such home territory.

      (2) Such Major League Club shall satisfy the Commissioner as to the bona fides of such Club’s intention to operate in such home territory on a long-term basis and as to the financial ability and character of the owners of such Club to maintain such Club for a period of five years.

      (3) Any park owned or occupied by such second Major League Club in such home territory shall be located not less than five air miles distant from the park of the Club first located in such home territory, unless the two Clubs mutually agree otherwise.

      (4) Such second Major League Club, before commencing its first year of operation in such home territory, shall pay to the Club already located in such home territory such sum of money as the Commissioner deems appropriate under the circumstances and in addition shall pay to the latter Club one-half of all sums paid by the latter Club to Minor Leagues or Clubs as compensation for inclusion of such home territory in a Major League. Any disputes as to the amounts paid as such compensation shall be determined by the Commissioner.

      (b) NUMBER OF CLUBS. In no event shall any home territory in either Major League circuit have more than two Major League Clubs.

  23. I can safely assume that Larry Dolan, Mark Shapiro, Chris Antonetti et al are watching this closely.The Indians seem to operate from the standpoint that they’ll make money from the the huge new TV contracts and revenue sharing and damn if they care about putting a competing product on the field. Best interests of baseball Bud, or best interests of the lodge?

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s