BOB: A look at the more leveraged teamsby Brian Borawski
June 08, 2011
Nine teams reported in violation of MLB debt service rulesI’ve written ad nauseum about the troubles behind the Los Angeles Dodgers and the New York Mets the past couple of months. The Dodgers have had a hard time paying their bills because, depending on who you believe, either Frank McCourt doesn’t have any money because of his divorce; or because MLB isn’t letting him sign a television deal with Fox. The Mets are in trouble because the trustee in the Bernie Madoff scandal is after the team’s owners to the tune of a billion dollars because they should have known that the ponzi scheme was actually a ponzi scheme. The Mets found someone to buy a stake in their team to help out with their monetary issues, while the league took over the Dodgers to deal with their troubles. As it turns out, these aren’t the only two teams that are currently in violation of MLB’s debt service rules.
A product of the 2002 labor agreement, teams are limited in the amount of debt they can hold to 10 times the team’s annual earnings. That’s the general rule though, because the commissioner basically gets to decide whether it’s enforced or not. This has become an issue because Frank McCourt is fighting over the league taking over his team and one of his claims is, why he’s been singled out when other teams have a similar problem. The other seven teams that aren’t in compliance are the Baltimore Orioles, Chicago Cubs, Detroit Tigers, Florida Marlins, Philadelphia Phillies, Texas Rangers and the Washington Nationals. For some insight on each of these team’s situations, there’s a good write up over at the Biz of Baseball by Maury Brown.
MLB hopes to wrap up Dodger’s inquiry later this monthThere was some concern that the Dodgers weren’t going to make their payroll in May. Somehow, owner Frank McCourt was able to scrape together enough money to keep things going for at least a couple more weeks and with that, MLB announced that it hoped to finish its investigation into the Dodger’s finances by June 22. That’s also the day that Frank and his ex-wife, Jamie, will square off in court over the proposed television deal that the team supposedly has on the table with Fox.
With that, you don’t see the league meet its self-imposed goals too often. McCourt feels the league is just dragging things out until he runs out of money so they can take over the team. Fox isn’t signing a television deal until they know Jamie McCourt is out of the picture, so it should make for an interesting and pivotal day for the franchise.
Athletic’s stadium updateIn light of the report that nine teams are in violation of the debt service rules, newballpark.org took at a look at what might happen to the Oakland Athletic’s if they built a new stadium. As it stands, they’re not one of the nine teams in violation of the league rules, but the speculation is that they’d join the list with a new ballpark.
Be sure to take a look at the column because there’s quite a bit of detail. The bottom line is, while the A’s call for a solution to their stadium situation, a new ballpark might put the team in an untenable situation. The speculation in the article is that this fact might be one of the reasons the league is moving so slowly on resolving the situation.
Attendance UpdateWe’re a little over two months into the season and your attendance leaders are still the Philadelphia Phillies. They’ve sold 45,483 tickets a game so far this year. The New York Yankees are the top American League team with 42,849 tickets sold per game. The San Francisco Giants, Los Angeles Angels of Anaheim and the Minnesota Twins round out the top five although you wonder how long the Twins will last up there with the way the team is playing.
The New York Mets are the top draw on the road. This probably has more to do with the fact that they’ve hosted the Phillies for six games and the Yankees for three games already this season. Right behind them are the Yankees and the Cincinnati Reds.
At the bottom of the list are the Florida Marlins. I thought they’d get somewhat of a spike as people buy tickets to get better seats at next year’s new stadium. Right in front of them at 29 is their cross-state rivals, the Tampa Bay Rays. Last year’s bottom team, the Cleveland Indians, find themselves at 26 with their decent run this year.
Brian Borawski is a member of SABR's Business of Baseball Committee and writes about the Detroit Tigers at his own website, TigerBlog. He welcomes comments, questions and suggestions via e-mail.