Doug's Business of Baseball Weblog

New Sports Trend: The Team Doctors Now Pay the Team

In a long New York Times article, Bill Pennington reports:

Despite concerns among many doctors and the players' unions over the ethics of putting health care out to bid, about half the teams in the four major North American professional sports are now tied contractually to a medical institution. Industry analysts expect that number to grow significantly.

The teams like the money, and the hospitals like people to think that the teams reviewed all the local medical options before settling on their facilities as the best local option. Medical associations, and players' associations, hate the deals.

"These groups should have to put out a disclaimer: `We paid for the ability to treat these top athletes,' " said Dr. Robert Huizenga, a former team doctor for the Oakland Raiders and past president of the National Football League Team Physicians Society. "What's it say about our profession when the most high-profile jobs are awarded not by merit, but by auction?"

"These arrangements suggest the medical care is not based on a person's expertise but on the depth of his pockets," said Gene Orza, the chief operating officer of the Major League Baseball Players Association.

"Our players do not like this trend in medical-care agreements one bit."

I suspect Mike Colbern will have a few things to say about this, too...
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Baseball Revenue Sharing Going to Prospects

The AP has obtained a list of unaudited revenue sharing payments and distributions for 2003. A total of $220 million was redistributed, up from $169 million in 2002. Highlights:

Big recipients: Montreal ($29.5 million), Florida ($21 million - the other playoff teams must have loved paying this), Tampa Bay ($20.5 million), Kansas City ($19 million), Milwaukee ($16.6 million), Pittsburgh ($13.3 million), San Diego ($13.3 million).

Big contributors: New York Yankees ($52.6 million, or almost 1/4 of the total pool, not counting their luxury tax bill), Boston ($38.7 million), Seattle ($31 million), New York Mets ($21 million, or about $1 million less than they wasted on Mo Vaughn and Roger Cedeno), Chicago Cubs ($16.7 million), San Francisco ($13 million).

Others mentioned: Houston received $1.2 million; Baltimore received $250,000; Cleveland paid $4.8 million.

Spokesmen for the Pirates, Brewers and Devil Rays insist their clubs are reinvesting their revenue sharing money in their farm systems. Bob DuPuy agrees: "But if you look at the number of young teams that appear to have good young talent on the field and good farm systems, you have to come to the conclusion that it appears to be having an impact."

Milwaukee, at least, appears not to be spending as much as it should. The Brewers' balance sheet released as part of the recent financial review shows that the Brewers' operating budget declined in 2003, despite an $8.1 million increase in revenue sharing from 2002 to 2003, and a $7.6 million increase from 2001 to 2002. The major league payroll fell by $6.9 million from 2002 to 2003, while the "baseball operations" budget (scouting, player development, travel and baseball administration) rose just $3.6 million.

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Crucial Hearings Begin in Legal Battle Over Expos Deal

Jeff Blair of the Globe and Mail provides a few more details about the Expos arbitration, which began today.

More than 30 witnesses are expected to testify, including MLB President Bob DuPuy. Bud Selig's testimony has yet to be scheduled. Former MLB President Paul Beeston has already given a videotaped deposition which will be entered into evidence. Plaintiffs' lawyer Jeffey Kessler anticipates a ruling by August.

MLB insists the pending action won't affect the timing of its decision on the Expos' future, even though the federal judge hearing the case has directed MLB to give 90 days' notice before the Expos are sold or moved. That shouldn't be a problem -- even if MLB adheres to its stated timetable and makes a decision by the All-Star break, that would allow a sale or move by mid-October, which is the earliest the club could realistically go anywhere.
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Padres Owner Strikes Riches Near New Ballpark

This AP article describes how Padres owner John Moores is benefiting from the construction of Petco Park. In return for the taxpayers footing most of the bill for the ballpark, Moores agreed to ensure at least $300 million of development in the surrounding area. He bought 21 acres near the park, an area which is now seeing $1.4 billion of development.

But Moores can't be happy with the opening and closing paragraphs of the article, which discuss the fate of Peregrine Systems, the software company he founded, and cashed out of just in time:

Prosecutors say senior managers engaged in a variety of gimmicks starting in 1999 - from selling a phony $19.6 million invoice to a bank, to posting millions of dollars in revenue that was uncertain to materialize.

Since late 2002, three executives, including former chief financial officer Matthew Gless, have pleaded guilty to charges of fraud.

Moores - who sold more than $600 million in Peregrine stock between 1997 and 2001, most of it shortly before the accounting irregularities surfaced - has never been charged with criminal wrongdoing.

Moores declines to comment on Peregrine's downfall, citing his attorney's advice.

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Arbiters to Hear Claims Vs. Loria

The action brought by the Montreal Expos' former limited partners against former owner Jeffrey Loria goes to arbitration on Monday in New York. A three-arbitrator panel will hear the claims. The hearings are expected to run through June 9.

Note to those interested in this case: arbitration proceedings are non-public, and at the end of the process the arbitrators usually issue very brief rulings with little or no explanation. Once the arbitration is completed, discovery on the related claims against Bud Selig and Bob DuPuy can proceed -- but as a practical matter, if plaintiffs can't persuade the arbitrators that Jeffrey Loria violated their rights, they have little chance of winning their lawsuit against the MLB defendants.
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Twins Give Nice Twist to Athletics' "Moneyball"

Murray Chass of the New York Times reviews how the Minnesota Twins have built a repeat division winner through scouting and smart trades, contrasting them to Those Soulless Number Crunchers By the Bay. One of his paragraphs requires a bit more context, though:

Ryan, as it has turned out, traded judiciously. For Milton, he got Carlos Silva, who has become the team's most successful starting pitcher, with a 5-0 record and a 3.11 earned run average. For Pierzynski, he got Joe Nathan, who has replaced Guardado as the closer and has gained 12 saves in 13 opportunities and has a 1.37 E.R.A.

Local Minnesota writers reamed the Twins for trading Eric Milton and A.J. Pierzynski, lamenting the moves as a sign that ownership couldn't or wouldn't pay for a competitive team, or else used the moves to echo the club's demand for a new ballpark. Both of these moves were fully defensible on baseball grounds even before the new players showed what they could do: Milton was overpaid by any reasonable standard and Pierzynski had lost his job to the best catching prospect in years.

Any club, on any budget, can improve itself by drafting well and trading players it no longer needs for those it does. Trading overpaid players and surplus talent is a good thing, whether you're the Twins or the Yankees. Now if Minnesota could just do something about the talent distribution within the organization -- if they could use some of their spare outfielders to DH for their middle infielders, they'd win 105 games.
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Bud Selig Unplugged

The title refers neither to life-support systems nor to cutting him off in mid-speech -- it's a long interview with the Commissioner, conducted by T.J. Quinn of the New York Daily News. A few highlights:

Bud says interleague play was almost adopted in 1973:

"I can tell you just on inter-league play we had a deal done in 1973 and the National League guys killed it. We had a deal done - we had deal done with the commissioner, both league presidents. Frank Dale, who was running the Cincinnati Reds - was also the publisher of the Cincinnati Enquirer - he and I sat and we had a six-game interleague play deal done. It was done."

Not according to my notes, it wasn't.

The February 3, 1973 Sporting News reported that the AL thought the NL would go along if the interleague games were added to the regular season, making it 168 games. However, the AL declined to make a formal proposal because the parties were negotiating a new CBA and the MLBPA had proposed shortening the season to 154 games.

After that CBA was signed, the owners in each league voted separately on interleague play. The September 1, 1973 Sporting News reported that when votes were actually taken, the AL unanimously favored interleague play and the NL unanimously opposed it. Commissioner Bowie Kuhn, a supporter, "resolved" the issue by appointing a steering committee to study the question.

The Commissioner insists he won't approve ads on uniforms (at least for games in the United States -- he'a already approved them for the early Opening Days in Japan): "I'm telling you right now, we aren't going to have advertising on uniforms."

Bud on contraction:

What people never wanted to understand, is that, here's what fueled contraction - it was all owners, but it was really big-market owners. Once we go to revenue sharing, the big clubs have a right to ask, what is the gross revenue of a club? How much did they get in revenue sharing, and what are they doing to change their own internal dynamic? And they had a right to ask the commissioner, "How long can we expect that to go on?" If I would have to guess today, I would have to think, as long as I'm commissioner, we won't have to look at contraction.

Or in simpler terms, "The Expos and Twins were egregiously abusing the revenue sharing system by taking money and refusing to reinvest it in players. With no enforceable way of making them spend the money properly, the owners who were writing them the checks decided they'd rather write one big check (and get the other clubs to share the cost) than an endless series of smaller checks."

Bud on labor issues:

But the problems from our standpoint - the labor union didn't deal with the problems so the problems kept being exacerbated by non-action. We dealt with it - we have a tax, we have a debt-service rule, all those other things, so I'm satisfied we've dealt with our problems.

And it looks like I'll be resetting my countdown clock:

Q: Are you considering retirement after the next CBA?

A: My response to a question was are you still having fun and I said I'm not sure I'd use "fun" to describe what I'm doing. But it's very challenging. I've done this all my adult life and my contact's up at the end of 2006, at which time I'll be 71 years old. I've said to a lot of people, "I promise you now we'll talk about it in the next year." And I'm open to staying but we'll see what happens. So I have two and a half years - longer than that, maybe.

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More Than Two Dozen Negro Leaguers to Get Pension From New MLB Fund

The 27 players affected by the new fund played in at least four Negro League seasons after Jackie Robinson's debut in 1947, but never played in the majors.

In 1997, MLB voted pensions to similarly situated Negro Leaguers who played at least one day in the majors. These 27 won't receive the same benefits, though: while the ones with major league experience receive $7,500 to $10,000/year for life, the ones who never made the majors will be given the choice of $375/month ($4,500/year) for life or $10,000/year for four years.
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Investor Says Group Wants Braves

One Charles Vaughn, last seen trying to move the Expos to Puerto Rico, has announced that he'd like to buy the Atlanta Braves. Interestingly, he made this announcement before contacting Time Warner, which owns the club:

"Our firm would like to get involved with the Braves. We are going on the offensive. We are just going to approach them and see."

Time Warner hasn't indicated any desire to sell the Braves.
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