Small Market Teams Pocketing Spare Change

by benny benack on Nov 20, 2009 12:19 PM EST Comment 10 comments

http://sports.espn.go.com/mlb/columns/story?columnist=stark_jayson&page=rumblings091119

that's the link above to the ESPN article by Jason Stark referencing Scott Boras' comments about small market ownership not properly using the $$$ alotted them in revenue sharing. The Pirates actually come up a couple times in the span of the article, but to Bucco fans this thought isn't anything new as we've all accused Nutting of doing this for years.

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That’s a silly article to be honest. Just because money isn’t being used for the major league payroll doesn’t mean that the money is being pocketed by owners. There are plenty of other places to invest revenue sharing funds (scouting, draft, building new facilities).

I made most of my life decisions at a Foghat concert... I stand by them.

by Chester J Lampwick on Nov 20, 2009 12:29 PM EST reply actions 0 recs

It's a dumb column by a dumb analyst.

The type of system he describes would incentivize the Pirates paying big money to bad players, simply in order to meet the payroll threshold (since FAs of quality are generally reluctant to sign with us). Thus making us less flexible, and decreasing the amount of money budgeted for international signings and improvements to facilities and such, which improves the product but doesn’t increase the ML payroll.

by Vlad on Nov 20, 2009 12:45 PM EST reply actions 0 recs

Based on basically the same revenue estimates they have in that article, Forbes said the Pirates had a profit in 2008 of less than $16 million. That means if the Pirates spent all of the $80 million or so the article suggests on MLB payroll they would operate at $16 million loss every year.

by ElDuce on Nov 20, 2009 1:03 PM EST reply actions 0 recs

So...assuming YOUR numbers are close...

Pirates payroll was $48 mill in 2008…and they MADE $16 Mill. Of course…that doesn’t count paying down the debt…which wouldn’t be considered profit. Right now…the 2010 payroll is going to be somewhere below $30 mill. So…you’re going to allow the owners to make $34 mill profit (at least)…while paying the team less than $30 mill…OK. Or maybe $31 mill…since the Pirates spent an additional 3 mill on amateur and international signings.

by Thunder on Nov 20, 2009 5:10 PM EST up reply actions 0 recs

Off topic but....

Any chance the Bucs make a play at Conor Jackson? He’s had trouble staying healthy, but showed some promise and is still relatively young (27). Looks like the D-Backs have Parra, Young, and Upton locking up that outfield so Co-Jax doesn’t really have a spot. He’s hit for a high average when healthy, yet never really showed the power Zona was hoping for. I don’t think it would take too much to get the guy, but I’m also not sure the bucs would have an interest. Any thoughts?

by jlk9697 on Nov 20, 2009 3:43 PM EST reply actions 0 recs

The D'Backs have claimed that they're committed to him as a starter in 2010.

He’s apparently fully recovered from his Valley Fever, and playing well in winter ball.

by Vlad on Nov 20, 2009 4:36 PM EST up reply actions 0 recs

The column may have been dumb...

at least as far as the system he proposes. However…there’s a LOT of truth to the money that is coming into the Pirates wallets. Unless you don’t believe publications like the Wall Street Journal, Forbes, Sports Business Daily, Pittsburgh Post Gazette. $80 million before selling the first ticket or beer is probably within a reasonable range of error for an estimate.

by Thunder on Nov 20, 2009 5:00 PM EST reply actions 0 recs

“Before selling the first ticket” makes for a neat buzz phrase, but it isn’t even true. I don’t know when revenue sharing money gets distributed, but central fund revenues get earned during the season just like ticket and beer revenues.

It’s also highly misleading. Guys like Madden and Boras like to throw around those numbers to imply that teams like the Pirates are making staggering amounts in profit. Madden compares the $80M figure to the Pirates’ payroll to imply that they’re making $40-50M or more in profit, but then he mentions that his undisclosed purported sources put the Pirates’ profit at $14M. That’s a nice profit, but adding that to the team’s payroll isn’t likely to make any appreciable difference on the field. And they’d STILL be near the bottom in payroll. Madden’s own numbers show that the payroll and the revenues received from MLB are nowhere near the whole story as far as the team’s finances are concerned.

by WTM on Nov 24, 2009 9:36 PM EST up reply actions 0 recs

Two things

1. ML payroll is an order of magnitude above what any of these teams, much less the Pirates, spend on int’l signings, development, etc. There’s no meaningful sense in which revenue “saved” from payroll is going elsewhere – how much was Sanos signed for? If the Bucs were spending $15M internationally every year, I’d buy the argument. But theyre not, so I don’t.

2. OTOH, isn’t it the league office that’s requiring teams to pay down debt first? Wasn’t it league rules that forced us to trade away Aramis? So wtf is up with this argument that it’s somehow bogus that the Pirates (and others) are paying down debt instead of spending it on payroll?

Anyway, the upshot is that this is a silly argument. If every team had an $85M payroll, you’d have a lot of overpaid players, especially on teams with a lot of young players. And what kind of insane system would penalize teams for having a lot of 1-4 year players? It’s a sustainable way to build a club! Are the Pirates supposed to pay Rickey Henderson $40M to come out of retirement so that we get our payroll up to a given level? Besides, a salary floor makes no sense without a salary cap, which we’ll get around the same time A-Rod takes a pay cut to come play in Pittsburgh.

by JRoth95 on Nov 21, 2009 12:38 AM EST reply actions 0 recs

The talent pool is a pyramid

So it doesn’t make sense for the Pirates and other low revenue clubs to spend equal money on bad players. If the Pirates have bad players, they should be paid like bad players, not good players. Only when they can get better players should they pay the players more money.

Since the Pirates can never have as high a payroll as the large market clubs, they will never compete for premium free agents.

So, there’s really only one way to get those premium players, and that’s to develop them internally.

The terrible thing about the current system is that small market teams cannot keep their own internally developed players when they become free agents. This is really the worst problem for MLB because it stifles the connection between the fan base and the players.

The solution would be for some of the revenue sharing money to subsidize small markets to keep their own free agents, but not allow that revenue be used for other things.

by MarkInDallas on Nov 21, 2009 1:30 AM EST reply actions 0 recs