Revenue deal OK'd by owners

January 19, 1994|By Peter Schmuck | Peter Schmuck,Staff Writer

FORT LAUDERDALE, Fla. -- The 28 major-league owners finally took the first step toward the economic restructuring of baseball last night when they ended a lengthy stalemate and agreed unanimously on a plan to redistribute revenue.

The long-awaited revenue-sharing plan is designed to help struggling small-market teams remain competitive in the face of spiraling costs and dwindling receipts, but the issue had taken on even greater significance as it divided the owners into big-revenue and small-revenue factions and delayed the start of collective bargaining with the Major League Baseball Players Association.

"In my judgment, this has been a remarkable and historic day," said acting commissioner Bud Selig. "The major-league clubs passed a unique and historic revenue-sharing plan, 28-0. Tonight was the result of thousands of hours of negotiations with Dick Ravitch and the Player Relations Committee -- and many owners participated in a historic and meaningful revenue-sharing plan."

The owners would not release details of the plan, but it appeared to be a compromise between the modified PRC plan that came up one vote short of approval two weeks ago in Chicago and a large-revenue-team plan that garnered only 11 votes at that meeting. Somehow, Ravitch came away with a unanimous vote on an issue that had held the game hostage for several months.

"I think it is critically important that it was passed by a 28-0 vote," said Ravitch, "because it means all the teams have the same commitment and objective -- to redistribute revenue between the clubs, maintaincompetitive balance and put the owners in a position to proffer to the union an economic partnership that includes a salary cap. If there was not an agreement, we could not make that proposal."

The way Ravitch sees it, the plan will allow the most economically disadvantaged teams to draw on a pool of money contributed by the richest clubs, the formula based on economic factors that will be re-evaluated annually. That means that a team that paid into the fund one year conceivably could draw on it the next.

"This plan is revenue and expense specific, not team specific," Ravitch said, "and it will be applied annually. It is not an agreement in which club X will pay. Clubs whose profiles meet certain characteristics are eligible to receive funds and other clubs that meet certain economic characteristics pay in."

No dollar figures were discussed, but the total pool is expected ++ to be between $50 million and $60 million per year when -- and if -- the plan is fully in effect.

The Orioles almost certainly would be one of the teams required to contribute heavily to the fund.

Of course, revenue sharing is only half the battle. The owners only agreed to pursue a sharing accord because they viewed it as the first step toward a revenue-based salary cap. The decision to redistribute their income was made unilaterally, but the imposition of a salary cap will not be possible without the cooperation of the players association.

"This agreement will take effect when we get a Basic Agreement with a salary cap ingredient," Ravitch said. "It will last at least as long as the Basic Agreement and will transfer enough money to the small-market clubs so that every club will be financially able to meet the obligation to the players . . . because any cap also will have a salary floor."

There have been no assurances from the union that the players willbe amenable to any ownership proposal that limits salaries, but Ravitch finally is in a position to create a specific agenda for full-scale negotiations on a new labor contract.

It also moves the owners and players a large step closer to another labor showdown, though both sides have agreed to keep the terms of the recently expired Basic Agreement in place through Opening Day.

Players association director Donald Fehr did not exactly join the owners in the round of applause they gave themselves after the agreement. He said from his New York home he has yet to see evidence of any economic partnership.

"I don't really have a reaction," he said. "It took Dick [Ravitch] a long time and he's entitled to a big raise. He has deliberately kept us in the dark and excluded us from this process. At some point, if he cares, I suppose they'll let us in on the details."

Fehr has long maintained that the union doesn't care how the owners distribute revenue, and he said nothing last night to indicate a willingness to cooperate on a salary cap.

"We didn't care as long as it didn't adversely affect the free market," Fehr said. "Now, they want the union's cooperation in adversely affecting the market. That's what a salary cap is."

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