Category Archives: Baseball

11.06.11
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CBA Talk: Cost certainty is a four-letter word

After another 8-hour marathon negotiating session, the NBA and NBPA again found themselves without any kind of agreement for a new CBA. This time, Commissioner David Stern also threw down the gauntlet, leaving the owners’ newest offer on the table for the players to stew over until the close of business Wednesday. If the players don’t accept the offer, the league will pull the deal and offer something measurably worse. First, let’s go over the basic tenets of the league’s offer.

  • League offers 49-51% “band” of BRI (defined league revenue) to players. This is essentially the same as the 50% offered to the players previously, but with a few wrinkles. The base offer is 50% to players, plus 1% annually set aside to fund retired player benefits. The 50% share would be dependent on the league reaching an unspecified BRI level, probably $4 billion. Any amount over that threshold would be split 57-43 in favor of the players, up to a total cumulative BRI split of 51% for the players. Running the numbers, for the players to reach 51% the league would have to beat the $4B revenue projection by $666 million, or 16.67%. That led NBPA president Derek Fisher to characterize the 51% figure as “impossible” to attain. In a move reminiscent of the NHL’s CBA, the players would be limited to 49% of BRI if BRI were significantly lower than the projection (also by an unspecified amount).
  • Escalating Luxury Tax. The previous dollar-for-dollar tax would be transformed into a much more punitive tax, starting at $1.50 per dollar over the tax threshold for the first $5 million over, then $1.75 for the next $5 million, $2.50 for the next $5 million, and $3.25 for the next five million. In addition, a “double tax” would be assessed at either $1 (league) or $0.50 (union) for teams who pay the tax three out of five years.
  • Variable Mid-level exception. There would actually be two definitions of the exception. For teams not over the luxury tax threshold, they’d be able to pay $3-4 million for 3-4 years. Teams over the threshold would only be able to pay $2.5 million for up to two years. There’s also some talk of having the maximum length of a MLE contract vary from season to season. This is clearly the most confusing part of the discussions and may be in flux, so expect some corrections in a few hours.
  • Sign-and-trade modifications. Luxury taxpayers would no longer have the ability to do sign-and-trade deals. If a team is over the cap and tax threshold and wanted a marquee free agent, they could work out a trade with that player’s previous team by having the previous team sign him for a lengthy max deal, then trade him immediately to the desired team for a mix of other players and draft picks.
  • Offer valid until close of business Wednesday (November 9).

Those five tenets were suggested by federal mediator George Cohen, and subsequently adopted by the league. A sixth item involving higher shared revenues for teams who don’t trigger the luxury taxes was not approved. For their part, the players aren’t backing off their request for 52.5% of BRI, though Fisher seemed to be somewhat amenable to 51% if it were a truly achievable number.

The Wednesday ultimatum sort of acts as a mini Doomsday, since the NBA will offer less if no deal is reached and it will probably cancel games in December. Any hopes of being able to play a full 82-game schedule in 2011-12 would be dashed. And there’s the growing possibility that the union will take a page out of the NFLPA’s playbook by calling for the union to decertify and an antitrust lawsuit against the NBA.

BRI for the 2010-11 season was $3.8 billion, which was up from 2009-10’s $3.65 billion, so it’s not hard to see the $4 B target as achievable. That’s where both sides are getting the “$40 million equals 1%” argument from. The players got 57% of BRI in the previous agreement, so a drop to 52.5% or 50% is a major concession. The problem for the players is that there’s a huge difference between the economy back when the last two CBAs were ratified and today’s economy. The NFL accomplished a major pullback in its negotiations with its players. The NHL is looking at the NBA talks with great interest, and is rumored to be pushing for a major pullback as well. MLB has no guaranteed payout to players as it has no salary cap or floor, but it regularly pays less than 50% to its players. The new trend for the four major North American sports is for the player-league split to drop to between 48% and 52%, depending on how revenue is defined. It’s quickly becoming a matter of bargaining against the other leagues, perhaps more than it is about preserving or changing existing agreements.

Every week lost in the 2011-12 NBA season translates to $100 million lost in game revenue, including tickets, other arena revenue, and broadcasting revenue. Over the span of ten years, which is the preferred CBA length for both NBA and NBPA, a few hundred million is not that much to lose compared to the impact of losing 2.5% of BRI over the course of ten years ($1+ billion). The league may see this as a test of the union’s collective will. Some want to play ASAP, others want to go the decertification route. It’s getting to the point that several weeks of games (and thus paychecks) will be lost and unsalvageable. There’s no guarantee that by holding out, the players will end up with a better deal. It didn’t work for the NHL players, and it didn’t work for the NFL players. MLB and the MLBPA must be laughing at their counterparts. Their biggest bone of contention is fixed slotting for first round draft picks, which the players union considers its own miniature form of salary cap. Somehow both sides have convinced the players that the lack of a salary cap/floor/guarantee is best for all concerned, despite the players getting less combined than their counterparts. But they get the biggest, longest individual contracts with most guaranteed years. While baseball’s business model does little for broad competitiveness among teams, it generally works for the players in terms of meritocracy and tenure. That’s hard to argue with when the other leagues have so much trouble arguing over details.

11.02.11
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McCourt reaches agreement with MLB to sell Dodgers

Update 11/3 11:15 AM – House Rep. Janice Hahn (D-Redondo Beach) introduced a bill to allow for public ownership of the Dodgers. Public ownership is not allowed per MLB’s constitution, but it’s a nice gesture. Hahn actually used the issue as part of her platform and rode it to election day in June.

Update 4:35 PM – The Associated Press (SI link) got reactions from Wolff, Tom Werner, and Mark Attanasio about their potential interest in the Dodgers. Wolff’s take:

“I’m very interested in having the sale occur for everybody involved,” said Wolff, a successful L.A. real estate developer. “As far as my interest in purchasing the Dodgers, I don’t have any. I’m interested in getting a new venue for the A’s.”

But would Selig, Wolff’s fraternity brother at Wisconsin, ask Wolff to join a bidder?

“That would be absurd,” Wolff said. “The Dodgers are going to go to an auction, and the highest bidder hopefully will revitalize the franchise.”

Bloomberg also reported that Fox may be interested in acquiring the Dodgers once again, but the company quickly denied it.

Update 3:00 PM – The New York Daily News cites an unnamed MLB insider who says that “it is unlikely Selig would try to steer A’s co-owner Lew Wolff and Boston Red Sox CEO Tom Werner – both Selig allies – toward making a bid on the Dodgers.”

Update 1:50 PM – Now it’s getting interesting. Bill Shaikin is reporting that the a prospective bidding group includes former Dodger GM Fred Claire (O’Malley era), A’s/Warriors/49ers exec Andy Dolich, and Ben Hwang, who looks to be the head of the group.

Original post below

Well that was faster than anyone expected.

Word started leaking over the weekend that Frank McCourt and Bud Selig were in serious discussions to have McCourt sell the Dodgers. This was confirmed Tuesday night by the LA Times’ Bill Shaikin, and further confirmed by a press release:

“The Los Angeles Dodgers and Major League Baseball announced that they have agreed today to a court-supervised process to sell the team and its attendant media rights in a manner designed to realize maximum value for the Dodgers and their owner, Frank McCourt,” read a joint statement. “The Blackstone Group LP will manage the sale process.”

Going back to the summer, when the McCourt divorce proceedings really got ugly, the prevailing wisdom was that unless Frank McCourt ran out of cash, he’d fight to keep the Dodgers to the bitter end. That would mean enduring a bankruptcy trial, lengthy divorce proceedings, and a possible auction of the team. Now it looks like the team will no longer be under McCourt’s control by the end of the month, and a new owner could be found and approved. Neither McCourt nor MLB are saying what prompted this turn of events. Whatever precipitated this, there’s no doubt that the timeline for selling the Dodgers has been significantly accelerated.

That gives MLB roughly six months to approve the next owner, though the process will be largely guided by the federal bankruptcy court, which will preside over the team’s auction. The auction will probably include the team and Dodger Stadium + parking lots, since those will all need to be sold to cover the McCourt’s enormous debts, short term financing, and a $130 million payment promised last week by Frank McCourt to Jamie McCourt. Everything could be sold as a package or on a piecemeal basis – that’s up to the court to decide. CNBC’s Darren Rovell has the over/under for the all inclusive sale price at $875 million, though several analysts have mused that the team and related properties should fetch well north of $1 Billion.

Of course, that leaves the question of who will make the winning bid. Having a court oversee the process gums up the works if you’re looking for a Selig crony to come in to get a sweetheart deal. Last year, the duo of Mark Cuban and Jim Crane drove up the price of the Texas Rangers by $100 million through auction bidding. There have been murmurs of several groups champing at the bit to get their shot at the Dodgers, so that $1 Billion mark could be eclipsed early. One thing to keep in mind is that not only does the new owner have to assume a ton of debt, they’ll probably have to agree to make $100+ million in improvements to Dodger Stadium in order for the team to stay “viable”. With an enormous bidding war for the Dodgers’ TV rights due in a couple of years, that’s relative chump change. Will it be Mark Cuban, Ron Burkle, or some private equity hotshot?

Prior to the auction beginning, you can bet that speculation will include Lew Wolff asserting interest in the Dodgers, a charge that he denied in January. That rumor was merely an unsubstantiated musing by ESPN’s Buster Olney and not based on any legitimate inside information. Wolff is buds with Bud, so he has to expect his name to be in the news and there’s little he can do other than deny, deny, deny. Given the circumstances of the team being beholden to the auction process, it doesn’t benefit either Wolff or MLB to have Wolff involved in the proceedings. There will be more than enough bidders, and there should be multiple entrants whose backgrounds and bids are far more substantial and less risky than Jim Crane’s or Frank McCourt’s. In addition, the asking price of the Dodgers will be so high that MLB won’t be able to pull off a Montreal-style “contract-and-expand” deal, with the other 29 owners digging deep into their own pockets to buy the team.

When the winter meetings come around in two weeks, it’s clear that if the CBA is item 1A on the agenda, the Dodgers are 1B. Crane will finally be approved as the new owner of the Astros, perhaps just to get it out of the way. It’s unclear what that means for the A’s. Wolff’s getalong working style may mean the A’s issue is tabled until January. Then again, Wolff could barter his vote for “future considerations”. It’s impossible to say whether or not the A’s will even come up, let alone have Wolff’s territorial rights request addressed. Does Selig want to focus only on a few select urgent issues? Do the owners have enough information to act now on T-rights, or do formal presentations need to be made? We should know in two weeks.

11.01.11
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Revised Citi Field dimensions unveiled

Sandy Alderson is making his mark as the new general manager of the Mets, and it starts with changes to the dimensions at Citi Field. Sure, beleaguered owner Fred Wilpon probably made up his mind long ago, but Alderson must’ve had some say over the details. The new dimensions are much more neutral than the expansive, pitcher-friendly measurements of old, as you can see from the comparison below.

The corners remain unchanged and didn’t need to be changed. Gone is much of the Modell’s notch in right field, to be replaced by a picnic area and a chain link fence. Where the original juts out in the power alley, the dimension and wall remains. Another short fence brings in the notorious triples alley in deep right-center under 400 feet (hint-hint, Giants). In left field, most of the 16-foot high wall will have an 8-foot fence placed in front of it, which should make David Wright’s life a lot easier. Wright tallied 14 HR at Citi Field during the 2011 season, it should be interesting to see how much he and Jason Bay benefit. Bay in particular has not been able to make the adjustment with only 18 HR in 900 PA over the last two years. In addition, it’s just as important for the Mets that Citi Field shake its reputation so that it can attract free agent sluggers in the future.

Despite the planning goof that Citi Field was at the outset, it generally follows the important rule that it’s always easier to bring fences in than to move them out. Around here we’re worried enough about Cisco Field that we’ve turned to making suggestions about making the dimensions more neutral. Unlike Citi Field, which was built on a large expanse of land, Cisco Field’s dimensions are limited by a major street to the east. There’s no moving that, or a gigantic wall/building in right.

10.27.11
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Dodgers may push A’s decision to backburner

The Chronicle’s Susan Slusser sheds more light on the San Jose land deals, adding this tasty bit at the end:

It is unlikely baseball owners would consider the A’s stadium at their meetings in Milwaukee next month because the Dodgers’ ownership situation is expected to dominate the agenda. Meetings scheduled for January might be more likely.

This probably wouldn’t have been an issue if it weren’t for the twin news items of Frank McCourt reaching a settlement with Jamie McCourt, then MLB reaching a settlement with Frank over a likely sale of the Dodgers. The Dodgers bankruptcy trial has been postponed, pending the outcome of both of those issues. The divorce settlement could be court-approved on November 14, right before the Winter Meetings. Assuming that it is approved, the Dodgers could easily push the A’s to the backburner, with the agenda already packed with the Astros-to-Crane sale and ongoing CBA talks.

10.26.11
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2012 MLB Schedule Analysis

Normally I do a review of the schedule immediately when it comes out. This time, I decided to step back in order to review the entire league. I’ve noticed a few things about how the schedule is put together, so I figured it would be best to take time to gear this post towards the traveler. I’ve done several ballpark trips over the years, and I’ve always been frustrated by the lack of tools available for those who want to take similar trips. Knowing this, I’ve taken the 2430-game 2012 MLB schedule and turned it into a grid (PDF), showing all games by home team and date. The teams are organized by geographical area (West Coast, Northeast, etc.) so it should easy to see how a traveler could hop from one city to another, catch a game in each market, then take a short trip to the next one. This first step is next season’s MLB slate, to be followed by all minor league teams. Then I’ll branch out to the winter sports, with the NHL to start, then NCAA basketball, and the NBA once if it gets its act together. I’ll round out the works with 2012 schedules for MLS and NFL/NCAA football.

[Tentative 2012 MLB schedule download in PDF format]

I’m getting ahead of myself. I’ve noticed in previous baseball seasons there are generally two “hot periods” for travelers to schedule ballpark trips for maximum efficiency. The first is mid-May, when interleague action starts. The other is around Labor Day. Those are the times when baseball tends to stray the most from its tendency not to schedule two teams in the same market concurrently. By allowing concurrent scheduling, fans can enjoy short travel distances between games and even the occasional two stadium, day-night doubleheader. This can be particularly effective on the East Coast and in the Midwest, where trips between markets are frequently four hours or less by car or train. Of course, the problem with having the “hot periods” occur in May and September is that they aren’t during the summer, when families are most likely to take long trips such as a weeklong pilgrimage to a few ballparks.

Shown in the spread format, there are a few other quirks about the schedule:

  • The A’s gave up a Sunday game (April 8) and a Thursday game (July 5) to accommodate the two “home” games to be played at the Tokyo Dome on March 28-29.
  • The A’s have another Sunday date with no game – August 26. For some reason, a three-game set with the Rays is scheduled for August 23-25, Thursday through Saturday. Update: This is due to a Republican National Convention event (thanks Nathan).
  • 16 marquee games are on the A’s home slate: 3 vs. the Giants, 6 vs. the Red Sox, 7 vs. the Yankees. 3 games vs. the Dodgers may also count. Expect these games to have premium pricing for non-season-ticket buyers.
  • The Miami Marlins play their inaugural game at the yet-unnamed, unsponsored ballpark on April 4, then don’t play another home game until April 13.
  • The Marlins have had 26 rainouts and 154 rain delays in their tenure at what used to be called Joe Robbie Stadium. MLB must really be looking forward to that going away for good.
  • There’s a unique opportunity from June 17 to June 26 to catch numerous games along the Northeast Corridor (Boston-NY-Philly-Balty-DC). If you don’t mind not watching the A’s, this is a flexible stretch during the summer.
  • The schedule PDF is poster size. Don’t expect it to look good being printed on a letter size sheet.

Enjoy the schedule. I appreciate any feedback you have on it.

10.24.11
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News for 10/24/11

We’re still three weeks from the winter meetings, at which the A’s situation is not guaranteed to be resolved. Until then we wait and stay informed.

Features to come after I finish a few things.

10.20.11
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Crane names his price and it’s a discount

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Perhaps MLB should put the Astros out on Priceline. Wait, wrong Crane?

The New York Post is reporting that Jim Crane’s price for moving the Astros to the American League is not, as I speculated, a future franchise sale price guarantee. Instead, Crane wants the value upfront, asking for a $50 million discount off the $680 million sale price. Assuming that MLB and Crane meet somewhere in the middle, we’ll see how desperate Drayton McLane is to finally unload the franchise. Based on previous reports, McLane is quite desperate. (Additional coverage available from The Biz of Baseball.)

Crane may be trying to deflate the valuation bubble a little. **Astros sale is not final.

Crane’s argument is that moving to the AL West will cause more games to be broadcast at 9 PM Central time because of frequent trips to the West Coast. Let’s do some math on this. Setting aside the interleague rotation, the ‘Stros currently play 4 NL West opponents roughly 6 times apiece. Cut that in half and it translates to 12 road games against the West Coast, then take away a third of those games as daytime games for a total of 8 games at the 9 PM start time. If they play in a 5-team AL West, they’ll play 3 West Coast opponents 18 times (assuming the format stays unbalanced). Half of those games will be at home, translating to 27 total games on the West Coast, or 15 more than before. Roughly a third of these games will be either weekend daytime or weekday getaway day games, reducing actual number affected by the two-hour shift to 18, or 10 more 9 PM starts than before. Is a 10-game delta worth a $50 million discount?

Crane is actually coming into a very good situation with the Astros. $12 million was spent last year to upgrade the big scoreboard. Renovations to club areas have also been completed. The Astros will be moving to CSN Houston, of which they’ll own 40%, in 2013. They’ll be partnering with the NBA Rockets, who will move starting with the 2012-13 season. With the ‘Stros in full rebuild mode, it would make sense for Crane to keep payroll low until the team sniffs contention again.

Moreover, Crane’s request seems to fall in line with the thinking that, when it comes to dealings between teams and owners on the business side, money generally does not change hands. If Lew Wolff gets territorial rights and the Giants are awarded compensation, it’ll be interesting to see what form that compensation takes. Based on this news and the historical pattern of how franchises work out deals (other than player trades), cash payments are not the likely form of compensation.

10.17.11
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Houston, we have a problem

After a lengthy delay and a lot of questions, Jim Crane may be on his way to becoming the next owner of the Houston Astros. Word out of Houston tonight is that Crane met with his board after another meeting with MLB. It’s hard to think that any information about Crane’s bid isn’t already out there for Selig and the higher-ups to review, so this looks like a matter of prepping the transition (which McLane desperately wants). The change would have to be approved at the upcoming owners meetings, along with the CBA and perhaps the A’s territorial rights matter.

Houston realignment to the American League

A key item in that blog link is that Crane is willing to accept compensation in exchange for moving the team to the American League, where it would be part of the West division. My wild guess at this point is that the compensation would be a franchise sale price guarantee as long as Crane’s group owned the team for a significant enough tenure – say five years or so. That would provide some protection for the heavily leveraged Crane group as they “endured” the transition. I’m sure the hardship of trading the Cubs and Cards (25k per game x 15 games) for the Red Sox and Yankees (35k per game x 12 games) will make the other owners highly sympathetic.

The preliminary 2012 schedule was released a couple weeks ago (more on that later this week), and it appears that MLB wants to bake it in ASAP, which would render a 2012 realignment impractical. In theory, it should be easier to make changes to the schedule since starting next year, there will be only one team who has to share a multipurpose facility with another franchise (I’ll give you one guess as to who that is). Another thing to consider is the schedule format, which could continue in the unbalanced method MLB now employs (15-19 games in division, 6-9 outside), or move more towards a balanced format. Some examples are listed in the table below.

Comparison of existing scheduling format vs. three potential realignment formats

Option A mostly retains the spirit of the existing schedule. Option B sacrifices interleague series for more interdivision games. Option C nearly achieves a balanced format, whereas Option D again reduces interleague matchups. Key to this is the question of how many interleague games are truly necessary, especially now that the games will be played throughout the entire season. Another thing to consider is that by starting the season with an interleague series, it gives MLB an excuse to always have an opening series in Japan, Korea, etc.

Astros fans aren’t taking this threat lying down, though one has to wonder how strong the opposition truly is. As of tonight, a petition at SaveOurStros.org has 633 signees. The Keep the Astros in the National League Facebook group has only 50 members. Not that MLB cares about what a few fans think. I’d feel bad for them, but they’re going to have a very strong rivalry with the Rangers in short order, which should be great for both franchises. As for the effect on the A’s, there isn’t much of one. They’d just be trading two opponents in the AL Central/East for one in the Central time zone. No big deal.

There’s also talk of adding another wildcard team for a one-game playoff prior to the divisional series. I didn’t have strong feelings one way or another on the subject until the final day of the 2011 season, in which the action was so riveting that it would be highly anticlimactic to eliminate it by creating game 163.

What are your thoughts on this? Personally, I’m glad MLB is creating an equal amount of interleague games for every team, which IMHO is far more important from a competition standpoint than confining interleague play to May and June. It’s something that has been impossible to address because of the 16-team National League. Now it can be fixed, and baseball will be better off for it.

10.16.11
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Shea asks if the A’s could stay at the Coliseum if the Raiders leave

Sometimes I wonder if, given the lack of juicy topics, some of the local media default to writing about the A’s stadium situation. It’s not sexy, and it’s easy to write about without getting into any real depth. That’s exactly what Chronicle baseball writer John Shea did when opining about a new Coliseum ballpark.

Shea thinks that the possibility of a joint 49ers-Raiders stadium in Santa Clara should provide an opening for the A’s to stay there. The land is already there and paid for, as is BART and a ton of parking. Sounds simple enough, right?

Should the Raiders decide that they want to stay in Santa Clara long term, then yes, this could work out just fine and dandy. Except for a few minor details. Allow me to enumerate.

  1. The Raiders may only view Santa Clara as a temporary thing (10 years), with an eye towards building somewhere else in the future. The prime location would be the Coliseum, which as reported previously, has plans on the drawing board for a new football stadium and land purchased to support it.
  2. MLB wants this thing wrapped up by 2015. They’ve said so to both Oakland and San Jose officials. By waiting out the Raiders’ decision making process, they’re guaranteeing that a new ballpark for the A’s couldn’t open until 2017 or 2018 at the earliest.
  3. Why should MLB be subordinate to what the NFL is doing? The A’s have already suffered from that exact problem for the last 16 years.
  4. Who’s paying for the remaining debt at the Coliseum now? Certainly not MLB or the A’s.
  5. What happened to Victory Court? That’s the Oakland site that was chosen by both the City and MLB to move forward because of its location downtown. MLB has already dismissed the Coliseum and Oakland has gone along with it. Nothing has fundamentally changed to make the site more attractive. By going back and forth on sites like this, those involved look as if they’re not making a concerted effort. Instead, it looks like they’re grasping at straws.
  6. Wolff responds in the article to Shea’s idea by saying that he couldn’t privately finance it at the Coliseum site. And he’s right. A “rebuilt” Coliseum is out of the question since MLB would never go for it. And investing $450 million at the Coliseum is impossible for some time to come, given the state of stadium lending and the fact that it’s a “depressed area“.

The only thing that could drive this is if MLB outright rejected the A’s efforts to gain territorial rights in Santa Clara County. Even then, it really comes down to simple sentiment: Al Davis said before his passing that there could be a future for the Raiders at the Coliseum, whereas Lew Wolff doesn’t believe in such a future for the A’s. They’ve both spent a lot of time on this. After all this time, are they both wrong? Or is a quaint notion thrown out there on a whim more realistic? Somehow I find that hard to believe. Facts are inconvenient, I know.