Baseball's troublesome labor dispute took a nasty turn yesterday when ownership negotiators reacted angrily to a new proposal from the Major League Baseball Players Association.
Union negotiators proffered a phased-in revenue-sharing plan and decreased their luxury tax thresholds by $5 million each, but management lawyer Rob Manfred blasted the proposal as "regressive" and questioned the union's desire to make a deal with just five days remaining before the players' Aug. 30 strike deadline.
"Frankly, we could not have been more disappointed with the proposal we received," Manfred said by conference call after a relatively brief afternoon bargaining session yesterday in New York.
The union proposal calls for revenue-sharing increases to be phased in over the four-year term of the agreement, beginning with a total transfer amount of $172.3 million from the high-revenue clubs to low-revenue clubs in the first year of the contract, $196.6 million the second year, $219 million the third year and $242.3 million the fourth year - based on revenue figures from 2001.
Manfred cried foul because the previous union proposal called for $235 million and, he said, included no provision for a phase-in over the four-year life of the agreement. The difference between a four-year revenue-sharing proposal at $235 million a year and the union's phased-in plan is about $110 million. He also ripped the union for taking 10 days to make a new proposal.
"The proposal that we received was so out of the realm of expectation, it's going to take some time to digest," Manfred said.
Clearly, the level of animosity has increased dramatically, casting more doubt on the likelihood that baseball will avoid its ninth work stoppage since 1972.
Union executive director Donald Fehr seemed equally incredulous that Manfred was surprised by the phase-in, and clearly was annoyed that the owners chose to go public with their concerns about the proposal before responding to it at the bargaining table.
"This afternoon, the players association made a proposal to the clubs during negotiations," he said. "It covered virtually all of the significant issues between us - term of agreement, revenue sharing and the luxury tax issue. We moved in the direction of the clubs in quite a number of respects.
"This proposal is clearly not regressive. It is progressive in regard to the tax and revenue sharing."
Fehr insisted that it was always understood that any significant increase in revenue sharing would have to be phased in gradually. "The clubs have known for months that the changes would have to be phased in," he said.
The union lowered its thres- holds for a luxury tax plan to $125 million in the first year, $135 million in the second year and $145 million in the third year, with progressive tax rates beginning at 15 percent in the first year and rising for clubs that repeatedly exceed the progressive thresholds.
Though management conceded that the union improved its tax proposal modestly, Manfred also characterized it as unrealistic.
"We have a $125 million threshold and we have 20 clubs that after revenue sharing generate less than $125 million," he said. "Their tax would hit the Yankees and graze one other club [the Texas Rangers]."
Union officials won't apologize for their reluctance to move closer to ownership's proposed threshold of $102 million and a higher progressive tax ranging from 37 percent to 50 percent. They have voiced philosophical opposition to any resumption of a luxury tax and consider any threshold and accompanying tax rates as unnecessary.
They also continue to insist that the final year of the four-year deal should have no luxury tax, in part to prevent it from carrying over into ensuing years if there is another lapse in the labor contract, such as the one that has kept the expired terms in effect since last November.
The management bargaining committee chose not to resume bargaining last night, but Manfred indicated that the negotiations would resume today and that ownership would respond to the union proposal.
"I'm kind of at a loss to figure out how to respond when they clearly have moved away from us," Manfred said. "We have some very creative people and we'll come back with a proposal that I'm sure does a lot more to move the process forward than what they have given us."