Owners try tossing one pitch union likes

Plan for revenue sharing revised

tax left untouched

August 22, 2002|By Peter Schmuck | Peter Schmuck,SUN STAFF

Major-league owners have produced some movement in baseball's sluggish labor negotiations with a compromise proposal on revenue sharing, but it seems unlikely that it will provide the catalyst for a new labor agreement.

Management lawyers characterized the concession as "substantial," and union leaders indicated that they would likely respond to the proposal in today's negotiations in New York. There may be little chance for a breakthrough, however, until both sides move closer together on ownership's plan to levy a huge luxury tax on the game's highest payrolls.

The revenue-sharing issue is less troublesome because it is much easier to quantify the effects of management's proposed increases in the amount of local revenue to be redistributed around the major leagues.

The owners originally asked for $282 million a year to be shifted from the high-revenue teams to the low-revenue teams (based on revenue figures from the 2001 season). The most recent proposal from the union would allow the transfer of about $235 million.

Management attorney Rob Manfred indicated that the new proposal, which was given to the union on Tuesday, narrowed that difference significantly, but would not release details. It is believed that the owners' latest proposal calls for the transfer of slightly less than $270 million.

Perhaps acknowledging the more difficult negotiations ahead, Manfred did not express optimism that the proposal would change the tenor of the long-running labor dispute. "I am frustrated a little bit," Manfred said. "I'd like to get a more active dialogue going on the tax and the revenue sharing, but it takes two parties to have a dialogue."

Local revenue sharing and management's proposal for a phased-in 50 percent luxury tax on payroll in excess of $102 million a team have been linked together as the two most important components of a new Basic Agreement because both are forms of revenue sharing. But the players aren't likely to go out on strike over local revenue sharing for a couple of reasons.

Even before management's new proposal, the gap between the players and owners on local revenue sharing was $47 million a year, which would be just a small fraction of the estimated $300 million the players would lose in salary if they walked out for the final month of the season.

The union would prefer that big-revenue teams keep more of their money, but union executive director Donald Fehr would have a tough time making a major case against increased revenue sharing when he challenged the owners to solve their own problems in 1994 by sharing more revenue.

The luxury tax is a different story, because a 50 percent levy on the game's top payrolls clearly would have a negative effect on the amount of money big-market teams spend on players.

The union has stated its philosophical opposition to any luxury tax, but has proposed a plan that would phase in a smaller progressive tax (15 to 20 percent) on payrolls that exceed thresholds ranging from $130 million to $150 million.

"We thought it was a productive step to try to move the other related piece in the hope the whole negotiation would move forward," Manfred said.

"We have the flexibility I believe is necessary to get to a negotiated agreement," Manfred said, "assuming all parties are willing to enter into meaningful compromises."

The Associated Press contributed to this article.

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