Summing it up (with Slusser update)

Mark Purdy takes all of the stuff we’ve learned over the past couple of weeks and neatly summarizes it, with a few more tidbits thrown in for good measure.

  • The January owners meetings will by January 11-12.
  • Lew Wolff says that he has not been any discussions about selling the team.
  • San Jose Mayor Chuck Reed craps all over Oakland’s plans (such as they are).

I get the feeling that a lot of San Jose boosters are very excited this holiday season. Their gift will have to wait until after the New Year.

Updated 11/22 1:30 AM – Susan Slusser also adds to the story, describing Wolff’s trip to Scottsdale to meet with Selig two weeks ago. This time, Billy Beane was reportedly on board. Here’s the sure-to-be-controversial bit:

Oakland lost money last season for the first time this century, with an expected shortfall of several million dollars, according to Beane. The team is consistently a recipient of $20 million or more in revenue sharing, and Oakland’s attendance actually went up in 2011, but the payroll also went up $15 million, from $52 million to $67 million.

In past years, when the A’s were clearly out of contention close to the non-waiver trade deadline, the team’s modus operandi was often to sell off players. Part of the reasoning was to get young players (probably with little-to-no service time), part of it was to dump salary. 2011 was different in that despite the team was mired near the cellar for much of the second half, yet Beane and David Forst did not sell off Josh Willingham, Coco Crisp, or any of the starting staff. The only notable trades were of Brad Ziegler and Mark Ellis, and in Ellis’s situation the A’s actually sent the Rockies a little cash to make the deal work. While it would make sense to hold onto Willingham if they weren’t receiving anything they wanted in trade, if they held on they’d potentially get a first round or sandwich pick as compensation when some other team signed Willingham.

By not trading any of the veteran free-agent-to-be outfielders (Willingham, Crisp, Matsui), the A’s kept $3-6 million on the payroll. That’s probably the difference between breaking even and losing money in 2011, if Beane is to be believed. Keep in mind how this works from an accounting standpoint: unlike moneymaking teams who get virtually all of their revenues either in advance or throughout the course of the season, the A’s revenue sharing check only comes in December, well after the season is over. They and the other have-not teams don’t consider the revenue sharing receipt as part of their P&L because it’s not there when it can make a big impact. (No, the check is not going to impress Scott Boras if Beane calls about Prince Fielder.) On the other hand, it has a short-term turbo-boost effect on teams that recently opened or are about to open new ballparks, since those teams can get both the receipt for the past season and higher projected revenues for the first season in the new park.

Did Beane and Wolff hold onto to the outfielders in order to prove a point to Selig and MLB? That the M.O. of the past decade(s) was untenable in the long run, while bucking the trend doesn’t work in the short term? Surely they must have realized that Type B compensation was going away – it was talked about throughout the season – so why keep David DeJesus? It wouldn’t surprise me in the least if this was planned, given the current spending freeze until a resolution to the stadium problem is found. It reminds me of that silly fake-to-third-throw/fake-to-first play. It’s plainly obvious what’s happening and it elicits a chorus of boos. Once in a while it actually works.

56 thoughts on “Summing it up (with Slusser update)

  1. The limbo period will be over, a good thing, yet a very sad day for a city/community whose residents need all the positive vibes they can get. Oakland has produced countless great baseball players, it’s a shame this vibrant urban center might have its team taken away.

  2. No matter what happens it would be a great project and a spectacular read to investigate and piece together all of the critical components, conversations, deal points, and motivations that were behind the Giants’ positions and MLB’s deliberate acts and conduct. Hopefully, LW will be able to see and walk into a new stadium for this storied franchise that will last the next 50 years or so.

  3. when a shovel hits the ground at diridon in downtown sj, i won’t be celebrating until then. getting the green light to sj is a huge step but a lot of stuff can happen in between the green light for sj and a potential groundbreaking ceromony maybe sometime in late 2012 or early 2013.

    still the last month or so of the news down in sj is the first signs that this thing maybe actually becoming true. a brand new baseball only park for the athletics franchise since for the first time since since shribe park opened in philly in 1909. a century since this storied franchise has a place of it’s own specificially build for them. that’ll be a great day when it happens in a couple of more years hopefully.

  4. A new era is quickly approaching for the A’s! All real fans should be rejoicing regardless of the outcome so as long as they stay in the Bay! /woot

  5. Losing a few million last year? I doubt it. Open your books, lets see it. The Giants said that they barely broke even in 2010 in the regular season, and the playoffs and WS helped make them about $8 mill profit for the year. I don’t believe anything these guys say.

    • @jk-usa – Of course they’re not losing money by any honest assessment. By MLB peer standards, they might be because of the way everything is accounted for. It’s not about convincing you or me. It’s about convincing the rest of The Lodge.

  6. I would agree with your analysis that holding on to those players and losing money showed that Oakland was financially untenable as an option long-term. If the A’s cannot hold on to free-agents in Oakland now, then how can they improve the team and hold on to players long term given the market constraints they deal with and how will an Oakland stadium change that.

    I think this trickle of information also would prove that MLB is seriously considering San Jose. I think Purdy’s point is right, Giants are going to fight this and they could get the support of a few owners to hold it up, but is MLB willing to risk the future of own franchise, to keep another in a higher position? I think not, and given the size of the Bay Area in population and in terms of hi-tech, banking dollars, there is a chance to allow two healthy and competitive franchises to thrive.

    It’s up to Fisher and Wolff to find the compensation necessary for SF, although I agree with LaRussa, it was ours, we gave it for free and we shouldn’t have to, but whatever to get the deal done.

    The fact that Billy is getting involved in this, I suspect is because of the place he now occupies in terms of the economics of the game, whether literal or just symbolic. They are bringing out the big guns.

  7. Compensation for Giants:

    1) Guaranteed revenue levels through 2017, when the ballpark is paid off (no more $20 million annual mortgage payment).
    2) Guaranteed franchise value for Giants ala Baltimore/Washington scenario (perhaps $600+ million?)
    AND THAT’S IT! If Baer doesn’t like it he can kiss my brown…

  8. TO JK USA:

    Please call me today.

    It’s important.

    A’s observer.

  9. Of course we don’t know for sure but it does seem like Selig is going to offer the Giants some sort of compensation package and if the Giants persist in their refusal to negotiate, then Selig has the 75% votes to overturn the t-rights. Also, Selig must ensure the Giants cease their antics – no more funding astroturf groups against the San Jose ballpark, no getting any surrogates to sue MLB, etc. MLB couldn’t have had the Yankee$ trying to stop the Mets new ballpark and that can’t happen here, either…

  10. -a’s agree that they would expand cisco field’s capacity up another possible 4k-5k.

    -they are buying up the last parcels of land that they can, maybe have to go ed to get the at&t parcells though?

    -rumors abound since the season ended that bailey is def available this offseason and gio could be too. who knows with other tradeabe assets like cahill, suzuki, balfour and heck even fuentes. already said that if bailey and especially gio are dealt before a decision is ruled out, i think it’s a lock the a’s know they’re getting sj.

    really would mlb/selig screw the a’s brass that wants to move to sj after 3 years of waiting and having done all they could to show that they have almost everything lined up other than a possible ballot measure next spring which according to the most recent polls that sj residents are in favor of the a’s move to sj i think 60%-40%?

  11. it seemed like Fremont was “lined up” too.

  12. Fremont had less hurdles to jump, so of course, it could be “lined up” faster. There was also the big NIMBY thing which killed it, and I don’t think that will be as big a problem for Diridon.

  13. Fremont was mostly killed by the real estate market collapse. Not an issue for the Diridon ballpark. Why do Oakland-only folks keep hoping for failure in San Jose when if that happens, the outcome is more likely to be the A’s leave the Bay Area than some magic billionaire comes along and gifts Oakland a free ballpark? San Jose is 35 minutes from the existing ballpark. Thirty-five minutes.. (As long as Oakland is committed to not paying for construction of an Oakland ballpark, there will be no new ballpark there. Borrowing a pile of money for site acquisitions and telling the A’s “Build here, on your own dime. Your problem if you end up losing your shirt” is not going to fly.)

  14. Actually Fremont didn’t have a NIMBY problem until they moved from Pacific Commons to the NUMMI site.

  15. You mean the Warm Springs site. Fremont had a problem with the big box retailers getting in the way (while smaller retailers near the site favored the ballpark). But the ballpark village thing fell apart when the real estate market collapse.

  16. @Dan: There was Big Box NIMBYism at Pacific Commons, residential NIMBYism at Warm Springs.

    There never was a NUMMI site NIMBY, because it was never really selected as a site by the A’s. It was only suggested by Fremont after NUMMI moved out.

    @pjk: Yep, that killed it too.

  17. The end is near guys.

    Selig will offer a compensation package where MLB pays off the Giants not the A’s. He has the votes and all options have been exhausted.

    This is a Godfather move by Selig….He is the deal, take it or leave it. We will vote in January and if you want something then take it. If not you can have nothing and go on your merry way.

    Selig has dreaded this and now he has no choice but to strong arm the Giants. The Giants for all their greed will go down and if they fight this they will alienate Selig and the entire lodge.

    The lodge is behind this and Selig has their support….It is only a matter of time.

  18. i still don’t know why 95% mlb owners would oppose the a’s moving to sj. obviously it looks as there are many million/billion dollar corporations that would only support a mlb team based out of sj. how many of those in the letter to selig from svlg actually supported sf and how many didn’t? i think the majority didn’t and that’s again why i’ve said sf doesn’t want money down in the south bay to go to the a’s potentially leaving them with acual competiton at least off the field finally.

    that’s imo a ton of money that is being left on the sidelines that won’t partcipate with the a’s or even mlb down the road if the a’s don’t go to sj. why would the other owners want to appease one gready team when for the decision for almost EVERYBODY associated with “the lodge” is the a’s moving to sj.

  19. @Sid
    Wow, now even you’re optimistic! 😉 Now I have to be more optimistic. You’ve changed your tune regarding what you are speculating what Selig’s motives are. Of recent events, what has changed your mind?

    I’m just curious. And I’m glad you’re now optimistic, because of all the regulars here, you’ve been one of the more skeptical posters about an SJ ballpark getting done.

    Apart from all that, I could see the Giants refusing to deal with Selig, then Selig and the rest of the Lodge going forward anyway, and the Giants get nothing (which is what they deserve). That would be sooooooooooooo funny!

  20. If anything, the Giants should pay the A’s for years of back payments for having never rightfully paid for their precious T-rights, but still benefiting from them.

  21. This will all be settled soon after we pass the 1,000 day mark. Thank goodness.

    I think one interesting backdoor, whispered conversation or handshake agreement will be this one:

    That the Rays are not allowed to ever move in to another team’s territory.

    I mean, think about this: the A’s (and Selig) will need to get votes. The Yankees/Mets would want some assurance that similar action couldn’t be taken in 10-15 years to put the Rays in New Jersey or Brooklyn. The Mariners don’t want the Rays in Portland or Vancouver. The Rangers/Astros don’t want a third team in Texas. The Braves don’t want a team in Charlotte.

    I think that, if other teams get some type of promise, whether in writing or behind closed doors, that this type of action will never happen again, that’s the only way that they would all sign on for it.

    This league is settling in with exactly 30 teams and this exact divisional format and new playoff system for the next 20-30 years. All other franchises besides the Rays are settled with good stadiums (assuming SJ happens). If you assuage other owners’ fears about the Rays, they’ll get on board with A’s-to-SJ.

    That’s also why I think the Rays’ next home is either downtown Tampa or Montreal*. A lot could change in 30 years, but no other team could reasonably claim any of those territories as their own. And we know the A’s and Rays will never be contracted given that they’ve gone to this much trouble to re-align the Astros and the divisions.

    *Montreal is 340 miles from Toronto, the same distance from San Jose to Los Angeles. One could argue that putting the Rays in Montreal would encroach on Toronto’s “market,” but that distance is pretty significant. The U.S. vs. Canadian dollar has gone from $1.60 to $1 in Jan 2002 all the way down to leveling at about 1 to 1 and occasionally even favoring the Canadian dollar. Montreal is the 2nd largest Canadian city, 7th largest in North America, 4 million Metropolitan pop, much wealthier and safer than any of the reasonable Latin American options…I think that’s the long-term solution for the Rays. Putting the Rays in Montreal would also improve travel distance for the AL East and create a good rivalry for Toronto, similar to what was done with the Texas teams.

  22. Purdy’s got one source and we all know who that is.

  23. i find that rays to montreal theory interesting. having watched the special programming of the story of expos on mlbnetwork in recent months, i think they got screwed over as potentially the a’s could be if sj didn’t happen which it looks like it will.

    obviously if the rays were to move, they’d have to stay likely on the east coast which would rule against another move another country like mexico as it’s been thrown around on occasion in recent years about moving a team down south of the border.

    would suck to see the 4th biggest state and one of the states that holds spring training be “stuck” with only one team while cali has 5, tex has 2, and ny has 2 themselves. rays don’t have a ton of history, really their only history has started since 2008 when they made it to the playoffs and world series. so they don’t have the tradition that an a’s team had had in oakland/bay area. but with baseball unlike in the other major league sports, i think there is more of a bandwagon effect especially in a state like florida where i doubt there are many rays fans compared to atl, nyy and bos fans who’d i guess the teams the majority around the tam area were fans of, especially the nyy since that’s where their spring training home has been.

  24. TB’s lease has something like 10, 15 years left on it. What happens with that? Think Saint Petersburg will just let them move away when there’s a binding lease? The A’s, of course, have a lease that’s actually too short – if San Jose is approved and the A’s need 3 more years in the Coliseum, they have to negotiate for an additional year on their lease.

  25. Leases can be broken, with enough cash.
    The whole A’s to SJ situation is different than TB to NY/NJ. The A’s are staying within their market. IMO, this doesn’t set a precedent for TB to move to NY/NJ.

  26. TB is on their lease until 2027. But I could Montreal happening around that timeline, especially if the Canadian dollar remains very strong relative to the U.S. dollar in the next 10 years. Part of Montreal’s competitive struggle was the disparity.

    IF – and this is a giant IF – the city/owner of a Montreal team built a state-of-the-art retractable roof baseball only ballpark, a team would thrive there.

    It would be ok if Florida had only one team. Some fans in both Arizona and Florida feel that having teams there has minimized local enthusiasm for spring training. Losing the Rays might actually increase Florida’s spring training market a bit, and stem the tide of teams leaving there for Arizona instead.

  27. seems as columnists from around the bay not named slusser and purdy are still having a pessimistic wait and see approach. here’s kawakami on his thoughts in his recent blog entry.

    “3–The A’s, the Giants, MLB and San Jose could and should be headed to some final stages of the whole long dance, let us hope.

    Fox Sports’ Ken Rosenthal reported recently that MLB officials have met with the A’s recently and Ken points out some adjustments to the San Jose stadium plans.

    Rosenthal reported that those same MLB officials are slated to meet with Giants brass at some point soon.

    Rosenthal also said that there’s some talk that, if the A’s remain stalled, MLB could examine the idea of taking the team over, securing an Oakland stadium deal on its own, then selling the team at a high price with the stadium lined up.

    (I’ve heard some of this same chatter, though it seems highly unlikely that the A’s owners would entertain that scenario–at least for now. If the San Jose situation is still in flux by April 2012… maybe the MLB-takeover idea will have some legs.)”

  28. The new CBA has modified debt rules. For teams with new ballparks the debt limit has been lowered from 15X to 12X. If a decision on SJ forthcoming, one would think MLB would make sure the financing model for Cisco Field could work under the modified system. But who the heck knows?

    Here is ML’s post from last spring on how changes to the debt rule could affect the financing of Cisco Field. Seeing as there are only a few comments in that post, I’m guessing you guys are as confused about this as me.

  29. Thanks BA A’s – Typical Ratto piece – saying a lot without really saying anything…..

  30. @ Stanley Stanson – “Purdy’s got one source and we all know who that is.” And unfortunately, that’s still a better source then yours or mine…. :X

  31. Ratto’s theory about it all being about hush money is interesting, and plausible.

    But I think Selig is going to approach the Giants, about said hush money, and the Giants are going to refuse to deal, and then Selig and the Lodge are going to move forward on SJ anyway – because
    a) they can, and the Giants can’t do anything about it, and
    b) it’s in MLB’s best financial interest to do so
    And the Giants will end up with nothing, except for pie in the face, throwing a huge temper tantrum.

  32. @jeff-athletic- I am very optimistic after the recent news about MLB wanting the ballpark in San Jose to be expanded in a meeting with Wolff/Beane two weeks ago.

    This plus Wolff getting options ready on the land with the SJ city council? This is going to happen after all these years.

    That plus Selig is going to meet with the Giants in the coming weeks? It signals he is going to give the Giants an ultimatum. Selig has no choice if he wants a 2015 opening.

    Selig tried in vain to find another city offering up a free ballpark or a Oakland miracle. He has refused to open the gates to San Jose despite the SJ Mayor, SVLG, and the A’s owners clamoring for a move for almost a decade.

    The Giants are a bunch of liars, they made 30M last year after they put 40M into revenue sharing. They are a powerhouse that only does business with 25% of SV corporations.

    The A’s are floundering and need a lease on life so to speak.

    The other owners are with the A’s because the team has existed in the Bay Area for 44 years along with the Giants. This is a unique situation where two teams do not share the common market.

    Baltimore/Washington is not a valid example because they do not share a common media market and overlap over 3 states and DC came later.

    Chicago, NY, and LA are valid comparisons because they share the same media market and are in the same state.

    The Giants if they are smart will take the $$ from MLB and run or walk away with nothing. Selig in January will put the T-rights issue to a vote and knowing Selig it will be a 29-1 vote.

    Selig does nothing unless the whole room agrees or 95%+…..He has that in his pocket.

    San Jose A’s in 2015

  33. Ratto’s speculation is, as always, amusing. He does say something that is important though: The Giants have no leverage whatsoever. It’s always been LW’s contention that the Giants don’t own those territory rights, the 30 MLB owners do. Moreover, LW is not going to be willing to pay one dollar to the Giants because the Giants did not pay any compensation for their imaginary rights in the first place – in other words there was no consideration. Their alleged reliance on the “rights” is a red-herring. If there were compensation to be given to the Giants it should be from some hard evidence of damages. For example, after the A’s are in SJ for five (5) years, the Giants will be able to litigate and/or arbitrate the precise amount of damages that has been proximately caused by the A’s relocation. They will have to present evidence of their damages with real numbers, not speculation. MLB will be able to present a defense. The outcome, determined by a trier of fact, either a jury or an arbitrator, will be their compensation. This would be the only fair, non-speculative, and equitable compensatory procedure. The A’s should have to pay nothing, now or in the future. They have paid a very high price for being held hostage for all of these years by this imaginary argument.

  34. Doing the math on the Giants:

    230M -revenue
    118M- Payroll
    40M- Rev share check
    20M- Debt service
    22M- Spent on employees, marketing, (# is way too high)

    Total: 30M profit.

    That # is probably higher as there is a 22M delta that is far too large. 10M is probably the right # and even so that is a 40M+ profit after rev share and debt service….

    Wow…..A move to SJ for the A’s is going to destabilize the franchise….RIGHT.

  35. @Rayburn’s son- By Anti-Trust law is illegal for the Giants to claim San Jose or any other place as their territory.

    In essence if the Giants litigate it puts the MLB AE at risk in court. MLB will get extremely angry at the Giants for this. Hence why the teams cannot sue each other.

    If a gas station is on a corner and I want to build a gas station across the street, there is nothing wrong with that. MLB is a special case.

    In the NFL the 49ers cannot stop the Raiders from moving to San Jose for example or vice versa.

  36. @ Sid – My suggestion is that the deal to prove the Giants’ damages would be the following: After five (5) years of the A’s in SJ, the Giants get to either litigate or arbitrate the issue of damages. It would not be a lawsuit, but would be a structured hearing, with testimony, evidence of damages based on real numbers, (not speculatiion). This process would be part of the deal allowing the A’s to SJ. I never suggested the Giants would sue. Hope this clarifies.

  37. @Rayburn’s son- They would have to decide compensation beforehand not after 5 years through a arbitration.

    For the Giants to argue damages would be a bad argument in any room.

    Selig has to figure that out in advance and that is apart of the reason why this took so long. He had to make sure that was figured out before forcing the Giants hand.

    In any event, the game is almost over….For the Giants that is.

  38. I’m not so sure the game is almost over, it might just be starting. However, what is true is that there is movement and that’s a good thing. But, a journey of a thousand miles begins with a single step. Personally, I can’t wait for the day when I get to ride my bike with my kids and my friends to a day game at Cisco Park to see Major League Baseball.

  39. the stadium situation will be resolved soon… according to agreement with players the a’s will be ineligible to receive revenue sharing starting in 2017 because they belong to a large market… this is plenty of time to build a stadium in SJ along with the added developments to make the area more viable.

  40. @Rayburn – the deal itself isn’t terribly complicated. It’s just forcing agreement at this point. “The Game” was this posturing or whatever by the Giants.

  41. @Sid

    Thanks for your arguments, and I couldn’t agree more.

    And thanks for the link to the Forbes numbers, on a pro Giants website. This is irrefutable proof that the Giants are lying their asses off about “just breaking even” and A’s in SJ would “destabilize the franchise”.

    And I’m now convinced that Selig, MLB, “The Lodge”, knows all of this. In two weeks Selig is going to read them the riot act, with maybe some financial consideration to keep their their mouths shut, or simply as a courtesy.

    But, man, the more and more I learn about this whole situation, the more and more I love the A’s and the more and more I hate the Giants. I now hate the Giants more than any other franchise in the history of all sports. Yankees? who cares. RedCox? meh. Lakers? nice cheerleaders . Cowboys? steers and queers 😉 Giants? Evil, lying, whiny, rat-f&%# bastards. I’ll try not to hold it against friends and family who are Gs fans (no, I won’t take sports that seriously).

    Do you know the way to San Jose …..

  42. Don’t we still have an election to worry about even if the A’s are allowed to move to San Jose? I know that most people think that a vote will pass fairly easily but nothing is a slam dunk.

  43. Nothing’s a slam dunk, but it’s looking like the A’s to SJ is now on a fast break for probably an easy layup.

  44. Don’t know if anyone else caught this tidbit as it relates to the new labor deal, but 15 teams including the A’s will no longer be eligible to recieve revenue sharing checks by 2016 (provided the A’s have a new ballpark.) If that isn’t evidence they want the A’s situation resolved ASAP I don’t know what is…

  45. @Dan- interesting- this is pretty significant to the giants bottom line- or is it replaced by something else for small market teams?

  46. @ Dan / rodoak1 – Wow, thanks for the heads up! Going to be a great start to 2012!

  47. @fc – I’m pretty sure monkeyball has been espousing that particular line for some time now.

  48. Making the A’s an exception is telling– MLB is telling other owners that no revenue sharing for the A’s will even be possible if San Jose is approved, but they’ll remain on the dole if they aren’t. That’s steering a yes vote for any owner who cares about money. Hell, in pure economic terms, even the Giants might benefit.

  49. GoA’s, No it’s not replaced by anything. The 15 teams identified, including the A’s are now classified by MLB as “larger market” teams. So the A’s after 2016, provided Cisco Field is open, will no longer be categorized as “small market” as MLB does not consider the Bay Area, nor the A’s share of it, a small market.

  50. baycommuter, another interesting thing is they don’t differentiate San Jose from Oakland when they say a new ballpark being open by 2016. They would consider the A’s “big market” from now on regardless of which city they get a ballpark in. However it’s obvious which city would give the A’s a better chance of being defacto big market, and it’s not the one they’ve been classified as “small market” in for the last 45 years.

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