More contraction B.S.

Forbes’ Mike Ozanian mused about contraction yesterday:

From what I am hearing, I doubt there will be any baseball at Tropicana Field after 2014 even though the team’s lease runs to 2027.

The funny part is that in the comments, someone pointed out to him that a second team would have to be contracted to make it work, which he casually acknowledged and then pointed the finger at the A’s.

Today the blowback has begun, from Craig Calcaterra’s brief and annoyed response to a much lengthier one from Maury Brown. That follows what Ken Rosenthal wrote six weeks ago, which I deconstructed in short order. None of the sensible arguments against contraction have changed. They’re just not noisy or loud enough.

Consensus appears to be that MLB is doing this to win concessions against MLBPA, which I find barely plausible at best. Instead, I think it’s more appropriate to look at the more hidden agenda. The endgame for the A’s and Rays would involve having New Yorker Stuart Sternberg own Mets and Los Angeles resident Lew Wolff own the Dodgers. Nevermind that Wolff owns less than 10% of the A’s, he could conceivably bring on big money partners to take on the rest of the Dodgers, a team with a $800 million franchise value.

It’s far more likely that interests in the two largest markets in the country want in on some kind of ownership piece and are on the outside looking in. They see Sternberg and Wolff as ways to get in The Lodge, and the greater the FUD spread about Fred Wilpon and Frank McCourt, the better their chances are. MLB is happy to entertain the notions for now, since they ultimately have the power to act on them – or not act on them, which is most likely. That’s a great strategy, as long as you’re only looking at things through a very narrow scope. Big picture, none of this makes any sense. As I argued in February, MLB has to get its own house in order before confronting MLBPA on any major issues. To get the Mets and Dodgers healthy and properly functioning again, it makes more sense to get new, non-crony blood owning those teams. There will be willing buyers, it’s just a matter of whether prospective buyers will balk when they look at those teams’ debt positions.

The debt and revenue problems for the Mets and Dodgers have far greater implications leaguewide than the A’s and Rays getting a combined $50 million in revenue sharing every year. When the Mets and Dodgers have large revenue and attendance drops, it hurts the league much more than changes to the A’s and Rays’ revenue profiles. While MLB could deal with all four teams in one fell swoop, a deeper look reveals that it’s not nearly as convenient as it appears. Wilpon and McCourt continue to be wrapped up in nasty litigation battles, and while McCourt’s divorce proceedings could end soon, the Wilpon-Madoff mess could stretch throughout the rest of the baseball season, if not longer. And if Bud Selig is as paralyzed by the Dodgers’ situation as he is by the A’s-Giants T-rights ordeal, nothing improves. Would that lack of progress and decisive action surprise anyone out there?

38 thoughts on “More contraction B.S.

  1. So Bud Selig would have to make the difficult decision to contract? Nothing to worry about, then. He’s not capable of making difficult decisions. We have the A’s languishing in limbo for years because of Selig’s inability to make decisions.

  2. Bud making a decision to contract would only be the first baby-step in a long, expensive, complicated and ugly process that almost certainly would NOT result in contraction actually happening.

    This is a non-story, and it should be noted that apparently nobody within MLB is making noise about contraction. This is coming from sports reporters who just aren’t familiar with the enormous legal, political and financial hurdles that make contraction essentially impossible.

  3. @pjk: I really don’t think this very lengthy wait is because Selig can’t make a decision. I think it’s more a case of Selig deciding not to decide (now). It’s already been discussed here in posts and comments that the A’s stadium situation doesn’t impact MLB’s overall financial standing to the point where they’re forced to make a decision now. I’m not subscribing to the contraction conspiracy theory at this point either. No one knows for certain why this is taking so long, but we can make educated guesses and this whole situation appears to be a card MLB/Selig is making a conscious decision not to play at this point (or however the expression goes). For now, 2015 is the target and there isn’t anything indicating that the 2015 can’t be met (at this point).

  4. With the Wilpon and McCourt messes, pending cba and now the bad pr with the latest Dodger parking lot beat down, you’d have to guess that the relocation thing probably isn’t at the top of Selig’s immediate to do list regardless of whatever relationship people may think he and Wolff may or may not have.

    I guess the longer this drags on for whatever reason, the more it benefits Oakland more than it does San Jose. On the surface anyway it appears that Oakland is the one who needs the time to catch up to where SJ is already.

  5. @ crister,
    Please explain how this thing supposedly “dragging out” benefits Oakland over San Jose.
    When answering, take into full consideration land acquisitions, infrastructure improvements, corporate support, financing the ballpark, etc.
    I do believe that the Rays might not be at The Trop after 2014, but that doesn’t mean they’ll be contracted.
    They’ll either be in a new Tampa Bay Area ballpark or relocated. Remember all, soon the Rays will be “the last man standing” in the ballpark saga.
    Let’s go Cisco! Let’s go!

  6. …Oakland has no money to build the ballpark and no one willing to build it for them. I’m also not understanding how dragging things out benefits Oakland over San Jose. The best hope for Oakland would be an MLB-funded ballpark, which would be unprecedented.

  7. @ Tony or pjk: Just curious, how would the longer wait hurt Oakland’s chances?

  8. …I didn’t say the longer wait would hurt Oakland’s chances. I just don’t see how it benefits Oakland over San Jose. Oakland’s chances are hurt badly enough by having no money for a ballpark, no political will to spend money on a ballpark and no private interests ready to build in Oakland.

  9. @tony d./pjk – You guys are getting ahead of yourselves. Any delay that keeps Oakland in the game helps Oakland, no matter how difficult the circumstances.

  10. Contraction isn’t going to happen, ever. Even relocation of the Rays (or of the A’s outside Northern California) would not be easy. Their Trop lease runs through 2027 and includes a provision for injunctive relief preventing a move. In the early part of the decade, prospective DC and Northern Virginia ownership groups separately took hard looks at the Devil Rays, whose then-owner was in serious cash difficulties. The conclusion in both cases was that breaking the Trop lease was not feasible. And that’s without even taking into account the politics and other business considerations.
    .
    Relocation anywhere means moving into a TV/radio market that is controlled by some other franchise. Even though the MLB Executive Committee has authority to adjust TV/radio markets for any reason it sees fit, the Nationals/Orioles situation set a precedent that there will be a significant payoff to the team losing the exclusive broadcast territory. So moving to Portland (controlled by the Mariners) or Charlotte (controlled by the Braves) or San Antonio (controlled jointly by the Rangers and Astros) is a lot more complicated now than it would have been before 2005.

  11. Of course continued delay helps Oakland. The basic parameters of San Jose’s offer, in which the A’s would have to finance their own ballpark construction costs, have been on the table for several years now. If it were attractive enough on its own to make Selig want to open up the Territorial Rights can of worms, he would have done so by now.
    .
    Everything in Selig’s history suggests that what he wants is competing offers from Oakland and San Jose. Oakland may not get its act together for that, but since San Jose isn’t offering to pay 100% of the ballpark costs there’s no reason for MLB not to wait and hope it can gin up competition.
    .
    In early 2004, the District of Columbia was offering to pay for 2/3 of the stadium construction costs plus all of the land and infrastructure improvements. The Expos Relocation Committee (including some of the same people currently serving on the make-believe A’s Relocation Committee) had been pretending to work for 2 years, and MLB had publicly stated that it was leaving Montreal one way or another. And the Expos were a much bigger drain on the rest of MLB than the A’s are now. But even in that situation Jerry Reinsdorf told the DC officials, “We are going to wait for a ‘Three Thirds’ offer”. And a few months later he got it.
    .
    I’m not suggesting that MLB is unrealistic enough to expect that kind of windfall deal from any city for the A’s ballpark, but rightly or wrongly their M.O. is to stretch these processes out until they are certain they have bled the winning city as much as possible. Not one cent will be left on the table. And if they can gin up a phantom rival bid from Sacramento or Vegas, they’ll do that if its useful for their purposes.

  12. I’m not sure a delay benefits anyone–either Oakland or SJ—bottom line the economics don’t seem to pencil out in Oakland…and sure…maybe with more time something can happen….which is pretty much their strategy as Jeffrey defined in a post long ago…bottom line the economy in the bay area is showing signs of recovery—ultimately that translates into land prices increasing….infrastructure costs increasing and to my knowledge Oakland has alot of acquiring to do…not to mention the challenges with RDA’s at some point

    Relative to SJ–realty is that the delay has allowed them to take care of some of the redevelopment challenges that they have/had—sounds as if they are positioned to acquire the remaining parcels…at least according to mayor Reed (indicated that both will be willing sellers)—I would assume that they would initiate the Autumn Pkwy work in the near future–no reason not to be pushing forward on infrastructure improvements that are part of the plan regardless of the ballpark

  13. Just for some perverse fun, let’s say the A’s and Rays are contracted. That’d leave the AL with 12 teams. MLB would then have to slot two NL teams over to the AL or restructure their league-division structure into a unified AL/NL setup. If they choose to keep the AL & NL separate and balanced, I’d say these two teams are flipped to the AL: Dbacks(West) and Fish(East) with the Bucks placed in the NL East.

  14. I’ve been saying this all along that the longer BS takes, the better it is for Oakland. LW will suck it up, abide by his frat bros decision and help get VC park built. As much as I wish LW would sell, giving up the A’s would be tough for him I believe, and I’m willing to give him a 2nd chance to make things right for this great storied franchise.

  15. Assuming there’s been a “delay” (I’m of the opinion that a decision has already been made by MLB), I don’t see any connection or relevance to one city having added benefit over the other.
    Again, viewing this whole saga through the lens of reality: land acquisitions, business relocations, infrastructure improvements, corporate support, private financing, what works for all of MLB, etc.
    Not getting ahead of myself RM, just trying to understand crister’s logic, that’s all.

  16. @Jk-usa- Lew Wolff has already stated he has given up on Oakland. This plus the fact Oakland has “no money” to get this done.

    Storied franchise? That is pretty funny considering the the fans never come out for this team even when they kick ass.

    In the end contraction probably will not happen and it will take lawsuits in order to get something to happen.

    The Rays are far worse off than the A’s because at least the A’s have a city in their general market that wants them and has a corporate base behind them.

    The Rays have neither and need public money just like the A’s do in Oakland and that is not happening….EVER.

    It comes down to Selig doing the right thing and opening up San Jose to the A’s and finding a location for the Rays to land….I like San Antonio personally, they have a facility that can be retrofitted for the time being and then they can find money for new ballpark in the meanwhile.

  17. Again, if this “delay” is better for/benefits Oakland over San Jose, then let’s hear the logic/reasoning behind such thought.
    No, Selig won’t/isn’t going to force his old friend to stay in Oakland because of some wealthy, whiny asshole in SF.

  18. …Wolff and Co. apparently have decided they won’t build in Oakland. So either he sells the team to someone else or MLB builds the ballpark itself. After attending Saturday’s game, with the 43% capacity attendance, I can fully sympathize with Wolff not wanting to spend hundreds of millions on a product that the East Bay doesn’t seem to want. Except on Opening Day or when people can come in and root for the Giants, Yankee$ or Red $ox.

    re: storied franchise. I’ve already brought this up, but there was no more “storied” a franchise than the Brooklyn Dodgers. Where do they play today?

  19. @Sid–“That is pretty funny considering the the fans never come out for this team even when they kick ass.”
    Never come out? Paleeeeez!!!
    You really don’t want to go there. I got stats that will prove you quite wrong on attendance when they’ve kicked ass and not quite kicked ass.

  20. 2006: A’s finish as AL runner-ups, winning the division and a playoff round Fans reward them with the 26th highest attendance in the league out of 30 teams.

  21. 1973: A’s win World Series; finish 17th in attendance; 1974: A’s win World Series, finish 22nd in attendance; 1989: A’s win World Series, finish 5th in attendance.

  22. @jk-usa… what stats would those be? The A’s have had exactly 7 seasons in the top half of MLB attendance over a period when they made the playoffs 15 times. That means that when they have kicked ass, less than half the time they drew well.

  23. so ML–something new–what is the significance of the SJ Council meeting on 4/28—agenda hasn’t been posted–

    • @GoA’s – Josh Koehn’s article in Metro mentions a possible study session on 4/28.

      The planning process could begin as early as an April 28 City Council study session. The baseball commissioner’s unreleased report is presumed to be complete, believes Mayor Chuck Reed, who has not heard from MLB in nearly two months and is running out of patience.

  24. ahh—interesting—thx

    • ahh—interesting—thx

      Even more interesting was that (per Metro article) SJ was in contact with MLB on a regular basis up until a month ago, providing maps and other information. Add to this the gag order that Wolff and Nuekom are now abiding by re: San Jose and things are looking very, very interesting.

  25. Just watched the A’s blow it against the Jays (Got Bailey?). When are we going to hear calls for the Jays to relocate or contract?
    Playing in vast multipurpose stadium in front of 11k. At the least the Jays should get a new, more intimate yard in Toronto.
    Worst case scenario they relocate to the states; no contraction necessary.

  26. Why don’t we move every team to the LA and NY area? 15 Teams in each area…

  27. …so when does the Oakland preliminary EIR come out?

  28. @pjk: good question, regarding the preliminary– I have read or heard nothing a “deadline” or due-date for that since December. ML or anyone else…any info?

    • @DavidL – I have not heard a date. By law, every major EIR release must have a Notice of Preparation a few days before the release in order to give interested parties a heads up. There may be other leaks of dates prior to the NOP.

      @pjk – The EIR does not specify cost. It is not a feasibility study.

  29. …I’d love to have the EIR come back and say “This project is doable and we have the $$” but I don’t think things are going to be anything close to that easy.

  30. Thanks, ML. If work is being done on it, that’s what counts. Let’s hope it is continuous with every passing day.

  31. Not sure how many degrees of separation there are between LW selling some of his luxury hotel properties and getting the balance sheet in order to invest in his sports venues (Earthquakes and A’s) but here is an article from Bloomberg’s that they are looking to sell some of these properties–also interesting to see the quotes from Fischer and Beane—indicates a pretty tight working relationship—

    http://www.bloomberg.com/news/2011-04-06/oakland-a-s-owner-wolff-seeks-1-8-billion-return-on-hotel-deals.html

  32. You beat me to it GoA’s :o). Wolff has mentioned in the past that “equity” was part of his financing mechanism for Cisco Field. $1.8 billion is a lot of equity. Things are looking very, very, very interesting.

    • You beat me to it GoA’s :o). Wolff has mentioned in the past that “equity” was part of his financing mechanism for Cisco Field. $1.8 billion is a lot of equity. Things are looking very, very, very interesting.

      Make it $1.3 billion, as $500 million will go into the pockets of investors. Still more than enough jack to finance Cisco Field/Quakes SSS.

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