||Agreement retroactive to start of 2002 season; expires
December 19, 2006
|Local Revenue Sharing
||Rises from 20% under former CBA to 34%, net of ballpark
expenses. Revenue sharing money divided equally among all teams.
||Each club receiving revenue sharing is required to "use its
revenue-sharing payments in an effort to improve its performance
on the field," subject to unspecified penalties from the
Commissioner if it doesn't.
|Central Fund Revenue Sharing
||$72.2 million (based on 2001 revenue figures) taken from
clubs which are net payers in the base revenue sharing plan and
given to those who are net receivers. This amount will fluctuate
in conjunction with the base plan, and is phased in: 60% in 2003,
80% in 2004, 100% in 2005-06. Money is paid and disbursed in
proportion to a club's distance from the average.
||This replaces most of the Commissioner's discretionary
fund with a formula along the lines proposed by the players.
Fluctuations intended to assure that the projected amount of
revenue is transferred each season from the combination of local
and central fund revenue sharing.
||$10 million from central fund to be placed within the
Commissioner's control, to be allocated at his
|Luxury Tax Threshold
||No luxury tax in 2002; $117 million in 2003, $120.5 million
in 2004, $128 million in 2005, $136.5 million in 2006. Luxury tax
expires on the final day of the 2006 season, so if the parties
play under the terms of the expired agreement in 2007, there will
be no luxury tax.
||For luxury tax purposes, payrolls are defined to include
salaries plus earned bonuses for all players on the 40-man
roster, plus a fixed amount per team in benefits and related
expenses. All multiyear contracts are valued at their average
annual value regardless of the actual payout in a specific
|Luxury Tax Rates
||2002: No tax
2004: 22.5% for first-time violators, 30% for second-time
2005: 22.5% for first-timers, 30% for second-timers, 40% for
2006: No tax for first-timers; 30% for second-timers; 40% for
third- and fourth-timers
|Luxury tax money to be used for player benefits (50%), the
industry growth fund (25%), or developing players in countries
lacking organized high school baseball (25%).
||$300,000 in 2003 and 2004, with two-year cost of living
adjustment in 2005 and one-year COLA in 2006. As of 2003, minor
leaguers on split contracts must receive at least $50,000/year
while in the minors, up from $40,500 under previous CBA
||Rules for a proposed worldwide draft to be established by a
jointly appointed committee. Committee will decide whether clubs
will be allowed to trade draft picks and will determine the
number of rounds: the players want 20, the owners want 38. A club
which fails to sign its first-round draft pick will receive a
corresponding compensation pick in the next year's draft; one
which fails to sign its second-round pick will receive a
"sandwich" pick between the second and third
||Draft pick compensation for losing Types A, B or C free
agents retained, though earlier reports said compensation would be
||Clubs agree to maintain 30 teams through 2006. They may elect
to eliminate two teams for the 2007 season; if they do, they
cannot take a contraction vote before April 1, 2006 and must
notify the players of their intent to contract by July 1, 2006.
Players agree that if they do, they will not argue before the
NLRB that contraction is a mandatory subject of collective
||Current contraction grievance will be withdrawn. If owners
elect to contract in 2007, their July 1, 2006 notice does not
have to tell the players which teams will be contracted.
||Maximum fine the Commissioner may impose rises from $500 to
$5,000. As under current system, suspended players receive full
||Owners drop proposals to authorize suspensions without pay
and to establish a system of automatic fines and suspensions for
||Same as under prior CBA
||Owners drop proposal to eliminate arbitration for "Super
Twos" and to allow clubs to release players after exchanging
||Club debt cannot exceed 10 times EBIDTA (earnings before
interest, depreciation, taxes and amortization), except that
clubs which have moved into new parks within the past 10 years
can have debt equal to 15 times EBIDTA. Three-year grace period,
at the end of which the Commissioner must choose between this
debt limitation and the old 60/40 rule.
||"Debt" defined to exclude money owed to players on
||Expressly reauthorized for the duration of the CBA.
||Two announced tests for steroids during spring training 2003.
If more than 5% of players test positive, mandatory random
testing starts in 2004 and continues until 2.5% or fewer test
positive over two consecutive years. The first time a player
tests positive, he is placed in a treatment program; subsequent
positive tests bring suspensions of 30 days to two years.
Players in inpatient treatment programs receive full pay for
first 30 days, half pay for days 31-60.
|No testing for other illegal drugs except for just cause.
Over the counter supplements such as androstenedione aren't
banned, but if more than 10% of players test positive for them in
any year, a joint union-management committee may ban them. Vote
of such a committee must be unanimous.
|Penalties for drug violations
||For players convicted of drug possession offenses (other than
marijuana and steroids): 15-30 day suspensions for first
offenses, 30-90 day suspensions for second, one-year suspension
for third, two-year suspension for fourth, suspension at the
Commissioner's discretion for fifth and succeeding offenses.
Commissioner can substitute fines for the suspensions.
For players convicted of drug distribution offenses: 60-90 day
suspension and $100,000 fine for first offense, two-year
suspension for second.
No penalty for players who voluntarily come forward and seek
Marijuana use: Fines of up to $15,000; no suspensions.
Steroid use: drug treatment after first positive test; 15-day
suspension or up to $10,000 fine for second; 25-day suspension
without pay for third, 50 days for fourth, one year for
||Clubs' contribution increased from $74 million in 2002 to
$113 million in 2003-04, $114 million in 2005 and $115 million in
||Annual cost of living increases for spring training and
meal/other expense allowances
||Players with less than five years of major league service can
be sent to a club's spring training facility for
rehabilitation; however, each day starting with the 11th counts
toward the maximum length for rehabilitation assignments (30 days
for pitchers, 20 days for others)
||Clubs will pay for players' transportation expenses if
they seek a second medical opinion anywhere in the country.
||Formerly the country was divided into three regions; players
paid for their own transportation if they went outside their
region to seek the second opinion
||All contract tenders to unsigned players on 40-man rosters
will be made by the Commissioner's office instead of
||Additional round of waivers added: current waiver period of
Nov. 11-30th day of season is split in two, with the first period
ending February 15 and the second beginning February 16.
||Seasons in which a player is optioned to the minors for fewer
than 20 days won't count against the maximum number of
seasons in which a player may be optioned; in return, players
receive major league service time for the period of such
||A player with more than 10 years in the majors, including at
least five with his current club will be allowed, as part of a
multiyear contract, waive his "10 and 5" right to block
trades, so long as the waiver applies to no more than 13
||Modified to afford clubs a 72-hour window to talk to a player
under contract to another club, even if no tentative trade for
the player has yet been arranged.