Ravitch to owners: open books

June 17, 1994|By Mark Hyman | Mark Hyman,Sun Staff Writer

WASHINGTON -- When Orioles owner Peter G. Angelos took the unusual step last spring of disclosing the team's most sensitive financial records -- documents showing hefty but declining profits -- he urged his fellow owners to do the same.

No one did.

Now, as they court public support for a plan that would bring radical change to baseball's economic system, owners still aren't allowing Joe Fan to see their records, even though their chief labor negotiator believes they should.

Richard Ravitch, the owners' negotiator, said yesterday that he has encouraged the 28 clubs to go public with information that Ravitch says would show as many as 19 teams projecting operating losses this year.

But he says that many have resisted, and that he's powerless to release the information without them.

"I am intimately familiar with the financial statements of all the clubs. There is nothing to hide," Ravitch told The Sun. "I have expressed my opinion that they [the owners] would be better off if this was discussed openly. But it's their decision."

Reached yesterday, Angelos welcomed Ravitch's comments.

"The fact that Ravitch is advocating it [disclosure] is a substantial step in the right direction," he said.

Angelos said the fans can't be expected to accept the owners' contention that they are suffering heavy losses until the records are opened.

"The arguments advanced by ownership -- that Major League Baseball will sustain a loss of $100 million in 1994 -- is something the players' representatives refuse to accept," Angelos said. "The only way to push aside the disbelief is by proving the case."

While officials of the players union have had access to club records for several years, that information rarely has been available to the general public. In addition to the Orioles, the Pittsburgh Pirates have released financial information, but most owners protect those records zealously, saying they are private businesses and they should not be subject to public scrutiny.

If their books were opened, owners would face disclosure of matters that some probably would prefer to keep private. For instance, some owners draw seven-figure salaries or charge heavy management fees to their clubs.

Owners also might be faced with disclosing "related-party" transactions, which might include business deals between the club and other entities run by the owner.

Philadelphia Phillies president Bill Giles said recently it was "doubtful" that his club would release its finances. "I don't really fTC object, but my partners like to keep things private," he said.

However, the Phillies have disclosed more general information about their finances, he said, including a prediction that the club would lose $1 million this year if it fails to make the playoffs.

Other owners, particularly some who bought their clubs recently, say they do not object.

"I think disclosure is a good thing because there is a lot of misconception about how clubs are doing," said San Francisco Giants president Peter McGowan, who led a group that bought the club last year.

On a limited scale, the owners already are sharing some financial information with the public. As they attempt to rally support for a salary cap -- a management proposal to tie player salaries to baseball's overall revenues -- Ravitch has publicly said that 10 teams suffered operating losses last year, and 19 are projecting them for 1994. Without a salary cap, club owners say the gap between rich and poor teams will widen, ruining competitive balance.

But as he speaks of the owners' problems, Ravitch has declined to identify which teams are losing money or to say how much each has lost.

"I am not authorized to discuss any specific club information," he said yesterday, citing a directive from the owners.

In their dealings with the players union, the owners have shared much more information. According to Ravitch, union officials have detailed financial information -- which they have agreed to treat as confidential -- on each team dating back to 1983.

"Whatever they've asked for, they've gotten. I haven't turned down a single request for information," said Ravitch.

But the records seemingly haven't brought the sides any closer, and have given rise to disputes over everything from the accuracy of the figures to whether the union is getting the information it needs.

This week, players union director Don Fehr said he'd never received the Orioles' financial records that Angelos released, and accused Ravitch of ignoring his request for them.

Ravitch disputed that, saying, "I told Don to ask Angelos for it."

The records released by Angelos in March show the Orioles' net income for 1993 was $25.5 million, thought to be the highest in the majors.

Because of higher players costs and reduced revenue from the national TV contract this year, the Orioles are projecting net income this year of $7.9 million, according to the figures.

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