There was a time when the MLB players’ union felt that a luxury tax is just a salary cap in another form, with is why they rejected such proposals back in 1994. Nonetheless, in the first post-strike collective bargaining agreement, executive director Don Fehr “finally said yes to the luxury tax – the first time the union agreed to any form of payroll restraint since free agency changed everything in 1976,” to quote Jon Pessah’s book The Game.
Though Pessah called that CBA a “huge victory for Fehr and the union” for other reasons, the owners did get their foot in the door on the matter of a luxury tax. The luxury tax wound up snowballing into a major problem for the players in recent years.
In that CBA, the tax thresholds were set like this:
- 1996: no luxury tax
- 1997: $51MM
- 1998: $55MM, a 7.8% increase
- 1999: $58.9MM, a 7.1% increase
- 2000: no luxury tax
- 2001: if MLBPA exercises its option for ’01, no luxury tax
Mechanisms were also put in place that could allow the 1997-99 thresholds to be higher, depending on where the fifth and sixth-highest payrolls in the game landed. Tax rates were set at 35% on the overage for ’97-98 and 34% for ’99.
While that CBA technically ended with two years sans luxury tax, it became part of all future agreements. The agreement that began in 2003 saw the luxury tax rebranded as the “competitive balance tax.” The MLBPA was able to achieve an initial major increase in the thresholds from where they left off in ’99:
- 2003: $117MM, a 98.6% increase from ’99
- 2004: $120.5MM, a 3% increase
- 2005: $128MM, a 6.2% increase
- 2006: $136.5MM, a 6.6% increase
For this CBA, a concept was introduced to penalize second, third, or fourth-time offenders with a higher tax rate. The first-time offender rates were set at 17.5% in ’03 and 22.5% in 2004-05, yet was removed entirely for ’06. 30-40% tax rates were set for teams that exceeded the threshold multiple times during that CBA.
For the CBA beginning in 2007, the tax thresholds were set as follows:
- 2007: $148MM, an 8.4% increase
- 2008: $155MM, a 4.7% increase
- 2009: $162MM, a 4.5% increase
- 2010: $170MM, a 4.9% increase
- 2011: $178MM, a 4.7% increase
Here after an initial “new CBA” leap, we start to see the tax thresholds moving up more slowly. The tax rates were set at 22.5%, 30%, and 40% and began penalizing teams for exceeding the thresholds in consecutive years, introducing the concept of teams “resetting” its rate by getting under the threshold for one season.
For the CBA beginning in 2012, these were the tax thresholds:
- 2012: $178MM, no increase
- 2013: $178MM, no increase
- 2014: $189MM, a 6.2% increase
- 2015: $189MM, no increase
- 2016: $189MM, no increase
Here, the players’ union made large concessions that had a compounding effect they’re still feeling today. If the MLBPA had achieved simply a repeat of the increases from the previous CBA, the 2016 tax threshold would have sat at about $232MM.
The next agreement introduced the concept of luxury tax tiers, adding first and second surcharge thresholds after the base tax one. For example, 2021 included thresholds at $210MM, $230MM, and $250MM. This CBA also introduced penalties involving the draft.
- 2017: $195MM base tax threshold, a 3.2% increase
- 2018: $197MM, a 1.0% increase
- 2019: $206MM, a 4.6% increase
- 2020: $208MM, a 1.0% increase
- 2021: $210MM, a 1.0% increase
While better than the previous CBA, the MLBPA again agreed to tiny increases in the base tax threshold. A simple 5% increase per year beginning in 2012 would have put the 2021 base tax threshold around $290MM, yet it sat only at $210MM. Not coincidentally, only the Dodgers and Padres exceeded a $210MM payroll this year. You can see the restraint this put on a club like the Yankees, which had a lower 2019 Opening Day payroll than it had in 2005.
In the current negotiations, MLB made an initial proposal that included lowering the base tax threshold to $180MM. According to Gabe Lacques and Bob Nightengale of USA Today, “In final proposals exchanged Wednesday, players requested a $245 million luxury tax threshold, with no progressive penalties for offenders; owners are offering a $214 million threshold, rising to $220 million in the final year of a five-year agreement.”
With a request to jump to $245MM, the MLBPA is proposing a 16.7% jump over the ’21 threshold, which would only begin to make up the ground they lost due to the non-existent or miniscule increases from 2012 onward. MLB, meanwhile, would like to increase the base tax threshold by 1.9% for 2022 and is proposing average annual increases of less than 1%.
Is it just me or does a 245 million dollar competitive balance tax threshold seem fair for both sides? MLB trying to lower it yet they put out a letter saying they did everything they could to reach a deal.
Not necessarily $245 million, but something likely higher than where it is now. A more thorough analysis would show the development of total team revenue, average salaries, and the CBT threshold over time. The CBT threshold should follow the trajectory of team revenue and average salaries. It should be automatically indexed every year to track some specific measurement of MLB financials (either salaries or revenue). The CBT should seek to regulate egregious overspending by clubs, not slowly strangle teams and players by failing to keep the threshold up with overall growth in average salaries and league-wide revenue.
I don’t think it should track with average salaries, since salaries have been depressed by the thresholds that have been in place.
Tying the thresholds to MLB revenue makes sense to me, assuming they could agree on what constitutes MLB revenue.
Makes sense, although I would argue growth in average salaries and growth in revenue represent the boundaries for new and future CBT thresholds, and would leave it up to the combatants to agree on a number.
I think this is the elephant in the room. What is the true revenue? The owners are reluctant to reveal it. Reluctant is probably a huge understatement.
for real, doesn’t every other league define exactly what constitutes “Revenue” in their CBA?
for real, doesn’t every other league define exactly what constitutes “Revenue”
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They do because it is part of the CBA. If they weren’t sharing revenue, they wouldn’t report it.
@Joe, they only share a portion of revenue.
Part of my rant was speculation on the total revenue. Expand the playoffs and give the players 50%.
The owners can artificially suppress average player salaries to suit their needs. They have already lost multiple lawsuits regarding collusion.
The owners would not try to artificially suppress revenue.
If it were based on revenue wouldn’t the threshold have been really low this year because of the COVID related revenue loss of 2020?
The increase would be small, the threshold would still go up or stay the same.
It would be helpful if this article posted a similar list along with the LT limits of the estimated league wide revenues for each of those years, so we could compare how the raise in LT limits corresponded to overall growth in revenue in the league.
No, it seems to low.
But was that restraint due to the tax or the passing of The Boss? I find it difficult to believe that George wouldn’t have simply blown right past that…
Tickets, parking, concessions, cost of cable TV – all these millionaires (players and owners) get richer and get greedier. Fans are at a financial breaking point and can’t afford to keep paying more for a product that just gets uglier. The great resignation won’t just be people quitting their jobs, but quitting other areas of their lives where they feel like they aren’t treated fairly – like sports entertainment. PLAYERS AND OWNERS are millionaires, and fans are NOT. Stop the Greed, save the sport.
The guilty party of your complaints is the ownership group and the blame should fall directly on their shoulders. They give out the player contracts, set the ticket prices, collect the money from all the incoming revenue streams and set the structure for how everything works.
Most players have a very short career and you can’t blame them for trying to maximize their earnings.
Bull s**t Lars. How much $$$$$ does one player need for their lifetime? Someone should be able to live off a million dollars for the rest of their life if they invest it properly. How much $$$$$ does Mad Max need? He has already made over 400 million in his career so far. The players are just as greedy as the owners and look how far baseball has fallen in popularity the past few years. If any games are missed this will be a death blow to MLB because a big part of the fan base won’t come back.
“if they invest it properly”
When you only have a number of years to make the most money possible, most people will take the most they can get. that’s the nature of the sports business.
DODGER JR – A reasonable follow-up question is, How much $$$$$ does one owner need for their lifetime?
That’s a given. But it is possible for a minimum wage player to play three years, get hurt, and have to work someday. A maybe $900k bank account won’t last forever. And if these were mid-round draft choices with 2 years of college, maybe, they might not have a lot of job prospects.
That said, I think I could retire today and not sweat for money. But as long as I do work, I am going to want to get paid. No actor, or painter, or musician ever worked for free because their last project set them up for life. Nothing wrong with getting paid for your work.
You could say that about many professions—corporate executives, actors, musicians, and even the owners themselves.
But in this country, we’re entitled to grab as much of the pie as possible.
If you don’t like that, I would suugest moving to Cuba or Venezuela.
@DODGER JR
How much $$$$$ does one owner need for their lifetime?
I disagree, most of these players are college educated and while they are athletes and that takes a toll on their body let’s not act like they are a full back who is taking 10-20 hits to the turf 17 weeks a year for 5 years. They should have some capacity to make a living after baseball. My employer never paid me extra because the toll it was taking on my body, that employer being the United States Marine Corps.
Many of these players came straight from high school or foreign countries without any college education. Fortunately, player contracts, at least for U.S. draftees, apparently include scholarship money for when their baseball careers are over.
How dare you introduce logic into this discussion.
BS liars. How much money does one owner need for their lifetime?
In case you didn’t read the article, the amount of money the game is making has skyrocketed in the past decade. The game has not fallen in popularity at all. A record number of people watched a game live in 2019. What has changed is how people chose to watch it.
BTW, the amount needed for a retirement at 65 with average lifespan of 78 years is $1.546 million. If that retirement comes at 26-28 after just 4 years for a MLB player on average what do you think they should have earned? A heck of a lot more than $1 million. Are you that guy that goes to a movie and says, “those actors are so greedy, they should have made only $1 million in their lifetimes”?
Its the nature of all business. If you can make $40 an hour are you going to accept $25 just because it will make the owner of your company more money?
Players are Millionaires. Owners are Billionaires.
MLB is a multi-Billion dollar business. You as a fan can’t wish the money away.
So…..
Do the Owners continue the trend of keeping more and more of the pie each season?
or…
Do Players get to balance the pie?
This is what it comes down to.
Wishing for everyone to ‘Stop being greedy’ is both siding an issue that isn’t both sides.
The Owners can’t even bother to pay the MiLB guys a living wage. This is the type of greed the MLBPA is up against.
Revenue is going up and most of that is from TV and streaming. You cannot blame the players for wanting an equal share of that increasing revenue.
MLB needs a hard cap just like every other sports league in America
MLB has 8 unique champions in 8 years. Tom Brady has 4 rings in the last 7 years. NHL has 2 different back to back champions in the last 6 years. The Warriors and Cavaliers played each other 4 out of the last 7 years, and the Warriors went to the finals more beyond that.
Salary caps don’t work. Among other reasons, players like Brady can take below market value to make sure the team can surround him with the players that he wants to play with. Win Superbowl get endorsements. They are *way* too easily manipulated.
Baseball is the only league without a hard cap, and by most measures… it has had the best parity in recent years, especially championship parity.
Besides a hard cap is more likely to hurt the players earning potential.
MLB is the only sport where the majority of the money each team earns comes from local TV contracts that are not 100% shared with other teams. Every other sport has 100% revenue sharing. The only way an NFL team makes more money than another is from local sponsorships and events in their stadium if they own it.
A simple 5% increase per year beginning in 2012
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That’s a bit ridiculous. 5% is no where near ‘simple’.
If a recent college grad making $70k as a teacher, works for 40 years, they’d be making $500k a year.
And they’d need that money, because the house that costs $300k today, would cost > $2M in 40 years. It would cost almost $4.to mail a letter. And most importantly, a beer at Yankee Stadium would cost $91.51.
Perhaps “simple” was a poor word choice, and maybe 3-4% would be more fair. I picked 5% because of what ownership agreed to in the 2007 CBA.
Teachers are paid by taxpayers, so that’s probably not a good analogy. Home values generally appreciate 3-4% each year, right? A $300K house today probably should cost $1.2MM or something in 2061.
A beer at a baseball game cost 65 cents in 1974. I’d imagine the average annual increase has been something like 5-6%, since a beer at Wrigley now costs $9.75.
I would think the luxury tax thresholds should have some connection to MLB’s revenues. MLB revenue is up more than 40% from 2012, and the base tax threshold is up less than 18%.
I actually think a beer at Wrigley Field could cost $60 in 40 years. Hadn’t really thought about that before.
Hey Tim, are you planning on making a post about the immediate temporary future of MLBTR? Will it be a ghost town til lockouts over?
I think it’ll become self-evident. We’ll cover all the labor news and anything else that is allowed to happen such as manager searches. Otherwise it will probably be a lot of looking back at the November free agent frenzy and looking ahead to potential post-lockout transactions.
I’m obviously not excited about having no transactions in Jan or Feb, but it’s not terribly different than the typical months that are lean on exciting transaction stuff, like April through June.
I’d be interested in a piece that tries to evaluate the impact of the CBA deadline on salary amount/contract length. Obviously, some teams went all in, others (the Yankees most notably, but there were a number of others) basically sat it out.
@tim now it’s more important than ever to get more subscribers. It pisses me off that so few will pay for the site.
Can give example also Tim of how much it’s cost to buy tickets to “lowly” A ball games. I can remember when a season ticket to FSL was 80.00. Now try and get a cheapo ticket to any A Ball game (outside of freebie GCL) for less than 10.00 each.
It’s more than prices going up the last 45-50y, it’s robbery at every level.
I would think the luxury tax thresholds should have some connection to MLB’s revenues. MLB revenue is up more than 40% from 2012, and the base tax threshold is up less than 18%.
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That’s a user error on the side of the players. The players have been offered a percentage of the gross every contract. They have refused every time. The players didn’t want the risk of revenue faltering. That’s fine. This is similar to some actors preferring a percentage of the gross, and some preferring the certainty of a $10M contract.
And that’s fine as well. But you can’t have both the floor provided by salaries, and the ceiling provided by a percentage of the gross. If the owners are taking the risk of faltering revenue, then they also receive the benefit when revenue increases.
And you and I would likely do the same thing. If I owned the local pub, maybe I might offer a good barkeep $15/hour plus tips. Or I could offer him $10/hour, plus tips, plus 10% of the gross. But if he chooses the $15+ option, he can’t come back later and expect the 10% of the gross.
The players cost themselves $1B a year in lost revenue because they didn’t anticipate MLBAM. They are about to cost themselves another $1B because they will miss out on gambling revenue. Then they will miss out on $1B in expanded playoff revenue.
They are married to a 20th century concept, and the union will defend it with their dying breath, without even knowing why.
Very interesting points. A perspective not often addressed amongst the commenters was the players’ desire for certainty of salaries instead of the investment in growth (thus percentage of gross). I wonder how the gross would’ve then been divided amongst the players? The owners raked, and there’s nothing wrong with that.
The MLBPA absolutely has shot itself in the foot one way or another in the last few negotiations. Maybe it’s been by allowing slow growth in the CBT, maybe it’s by not accepting a percentage of revenues (though getting a real number for MLB revenues could be nearly impossible), but the owners clearly have gained significantly in the pie-sharing battles.
Yeah, and the TV market was another huge one. The owners paid for their teams multiple times over with just the revenue from those agreements.
The owners have never offered to open their books to the MLBPA nor have they have never offered a percentage of the gross.
Would you take a salary in your job based on a percentage of an amount of revenue that the owner of the business would not allow you to see what the real amount is? Of course not.
Why you keep repeating a statement that is patently false and so easy to check is beyond me.
$70k from 40 years ago would be about $220,000 in spending power today. Now that assumes that the person that entered the workforce as a teacher in 1981 stayed a teacher and didn’t move up in their profession.
How about this….
Minor leaguers $75k
Rookies: $150k
First full year: $250k
add $250k per year after that until they retire, no matter what league they are in
Coaches 250k, Managers 500k
Assitant gm 750k, GM 1mil.
Owners $5 million
EVERY PENNY AFTER THAT…. Back into the pockets of the communities that have stadiums.
How about that idea instead of listening to multi millionaires argue with multi billionaires about how neither can afford a gallon of effing milk. How about that, instead?
Capitalisms is why that doesn’t work. The market is bearing the current model. If it wasn’t, these contracts wouldn’t be happening.
Yes, Joe is on the money! I don’t think you can restrict an owner of a business to a cap of money and force him or her to put all other revenue back into the community. That’s stepping outside of the MLBPA realm and into the business’s bank accounts.
Not to mention, if the government (or MLB?) were to do that, the owners would simply pay for their incredibly high-priced accountants and attorneys to find loopholes around this revenue, and we’d be back where we started.
So you’re proposing that a player who hits for 100 points higher in BA or statistically is considered a “superstar”, generally speaking should make the same amount as the statistically less successful players should all be on the same scale. Not very capitalistic.
1- There is nothing capitalistic about COLLECTIVE bargaining either. The socialism is in the freaking name. So just an ‘upto’ in front of my previous numbers to make it more free market for you
2- This is a union. unions have same salaries for it’s members, The military also has same baseline salaries for members or equal rank.
Grats on your reflex reply, it just wasn,t’ thought through
And then the billionaires lose money, leave the team, start new league, players want to play in that league because it has the option to make hundreds of millions of dollars, all the superstars are in the new league and the MLB is dead.
Anything else you want to kill today?
Regardless of semantics, the market still bears the model.
Collective bargaining is a benefit to the owners as well.
Do you really think the owners want to compete against one another for talent on the open market?
Sounds like you have no grasp of how anything works
The lack of creativity coming from the union is actually shocking to me, especially when you see the owners seemingly trying to come up with creative solutions. Here are my ideas.
-Raise the major league minimum, with additional automatic small salary escalators every year you are in the league before arbitration. The players deserve to be rewarded yearly for sticking around in MLB.
-A salary floor, with harsh penalties.
-A salary cap/luxury tax, with harsh penalties.
-Waning control over players as they age in the minors, maybe starting at age 24 or 25 you lose a year of control every year. This encourages teams to give guys a chance or deal them.
-Shorten the amount of control by a year, either that or make any part of year one count as a full year so that the loophole is gone.
-Figure out a way to disincentivize tanking. The draft lottery for the early picks is a great idea.
I don’t think these items would cost the owners much. Actually I think the diminishing control idea would facilitate trades and be good for the game and the players. I also think a good way to grow the game and make it more relevant is to work towards more teams having a shot at competing. I despise that there are huge payroll teams and small ones, at least by the current absurd margins.
I really like your idea of a floor with harsh penalties…
no 1st round draft picks and no international money sounds like a good start.
I think the club control on aging minor leaguers is a great idea to build on. You get late bloomers debuting at 27/28 that may never reach FA and stuck in arbitration increases.
I like the salary floor, however, I think it risks hurting fans more as the owners can move the team by complaining operating costs are too high and not enough fans. meanwhile encouraging this by having higher ticket prices etc. Owners make out on any city change as they are likely to get a new stadium, tax breaks and other incentives.
As an A’s fan, I can’t stop thinking about how this lockout can dramatically change their direction from the media-generated “The A’s are tearing down because WE say so!” narrative, which might have been false all along.
They have 4 position players (Olson, Chapman, Murphy, Laureano) who are top 5 undisputed at their positions, a full 5 man starting rotation with 3 front end ace-type guys (Montas, Bassitt, Manaea) and a pretty full pen. By my count they have an 18-man MLB-player core, with some tweeners and prospects ready now. They only really need an OF to replace Canha and a DH (Nelson Cruz perfect fit). This team is built to win in 2022.
Now, if a salary floor is instituted with harsh penalties there’s no way the A’s tear it down, they absolutely will do a 180 here and try and win the West.
The lack of creativity coming from the union is actually shocking to me, especially when you see the owners seemingly trying to come up with creative solutions.
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I’d probably feel the same way if all I read was news and opinions from Owner controlled media.
MLBPA doesn’t have the mouthpiece that the Billionaires have, but it doesn’t mean they have a lack of ideas.
Rolder-
You’re right; I could easily be more succinct:
Tony Clark is bad at his job.
Yes, he is, which is part of the reason we are in this pickle to begin with. He (they) missed some major key points (loopholes?) in past contracts that determined revenue, increases, and most of the important issues being debated on this very site. Then he circled back to complain about how the owners handled these issues. Frankly, I’m surprised they (players/members) allow him near the PA.
Clark may have dropped the ball on the previous CBA, but Clark not being an owner of a media network to voice his opinion isn’t a character flaw.
The MLBPA learned from the previous CBA and has assembled a much more qualified team to handle the current negotiations.
CalcetinesBlancos
Tony Clark is bad at his job.
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100% correct, imo. But he is nowhere close to being alone. When the last CBA came out, it took all of 2 seconds to realize what a bad contract it was for the players. Literally, two seconds. It will take longer to type but roughly ($210M – $190M) = a $20M increase over a base of $190M, or 10%. Spread out over 5 years, that is 2% a year. My ‘pulling it out of my a$$ estimate of revenue growth was 6%/year.
That’s not close, and it is hardly rocket science to figure that out. And because of other clauses, caps and punishments, it was a bit worse than I estimated.
Did the players, agents, or lawyers even notice this? It is impossible for me to have sympathy for the players accepting that.
Tony Clark is not negotiating this deal.
The MLBPA has negotiated at the table, not through the media like the MLB owners have.
The players are asking for an increase in minimum and for differences in arbitration. So that one is handled.
Only way to have a salary cap is if all teams share revenue 100%. Do you think the Yankees and Dodgers are going to agree to give up hundreds of million in revenue just so the Rays, A’s, Indians, Royals, Reds and other teams in small TV markets can have the same revenue? So a salary cap is out.
A salary floor is long overdue. With every team having enough revenue to spend $120 million on player payroll and still make a profit, teams like the Pirates spending $50-60 million while pocketing millions in revenue sharing should tick the other owners off.
Minor league players already have waning control the longer they are in the minors. Rule 5 draft and minor league free agency are both based on how many years since you signed your deal. If they sign a minor league deal after being in the majors I am not sure how that works, but that one is pretty much handled already.
The owners are fighting tooth and nail NOT to allow FA or even arbitration to shorten. The players union has offered several proposals already to limit a teams ability to game the service time. I agree that any time or a short amount of time (50 games on the roster like the rookie qualifications for awards?) would equal one year of service time would do the trick.
The elephant in the room is disincentivizing tanking. I think the salary floor would be a good start. Start it at $100 million with raises to that minimum tied to inflation or to MLB revenue. A penalty like losing your 2nd round pick for the first year you were under and your 1st round and 2nd round picks for a 2nd consecutive year under would be huge.
Think about ticket prices, concession food, memorabilia, jerseys, etc.
Am I the only fan that thinks the players are paid too much money? I’m not talking just baseball either. I remember where it was very affordable for a family to go to a baseball game. Those days are gone
It would be interesting if baseball decided to really position itself as the cheap professional sport to see in person, They could definitely do it given the amount of games.
Being that all the empty seats are already bringing in a profit as long as luxury boxes and advertising is sold, they could give seats away for free and still make money off food.
I agree. Though I tend to side on the side of the players, it’s not like the owners aren’t putting out some money. Scherzer’s contract is humongous. For good or for bad, the owners aren’t doing this for fun.. it’s a business. And if the contracts get even bigger, its just going to be passed on to the fans. Not sure why that link seems to be missing with so many fans.
Do you really think that most of a teams revenue comes from you buying tickets? A third or less of all revenue is from something other than TV. TV is what pays the bills in baseball.
the players don’t set prices for those things lol. that’s the owners.
The owners’ bottom line sets the prices. And if their payroll costs massively go up, they aren’t just going to say “oh, ok” and make less profit. They will try to make more revenue. Whether you are talking about baseball or general business, payroll costs affect owners’ earning potential, which affects costs and consumer prices.
Actually, the fans set the prices. The NYY might increase the price of a beer to $14, an 8% increase. If beer sales decline by 2%, the price increase stays, If beer sales decline by 15%, then they either re-price, or don’t raise the prices for 2-3 years. It’s the same at the local diner.
I do agree with you
Ticket/food/memorabilia prices aren’t strongly tied to player payroll. If they were, all these prices would plummet when teams tank and slash payroll. They don’t. Owners charge as much as the market will bear. Supply and demand.
Supply and demand is the fundamental force, but I suspect that often rising costs tempts businesses to try prices they wouldn’t otherwise push.
Exactly GBS!
How about working on a floor these small market teams ( fake news). Need to spend some money as of a couple days ago Baltimore and Pittsburgh had 0 players on guaranteed contracts. How is that acceptable
How is the idea of small market teams fake news?
Teams are going to spend less when it’s that much easier to make the playoffs.
Players union about to be taken yet again without realizing it.
Gotta hand it to the billionaires. They snuck in a hard cap without anyone noticing.
All these bs numbers on luxury tax. How about some numbers on the teams who received the luxury tax and where the money went. Then they cry poor because they need to new stadium or can’t sign players. I read one owner snorted his share of the luxury tax.
Precisely. And then, how much of their own revenue they had to spend after, which is probably negligible, at best.
It seems that the biggest problems stem from the draft and service time thereafter. Can they just move to something similar to international FA for top prospects? Each team gets a pool of cash. No limits but you get taxed for going over. Players and teams are able to negotiate the number of years, within a range, depending on player age. Not service time,, but years. Do you want to get to FA faster? Sign a short term deal but your bonus will suffer. Want to maximize your bonus? Sign a longer term deal.
Perhaps there is still a draft but it is for prospects that are not highly-touted. Players can opt-in and they will all have standard terms.. or they can just wait til next year and start the process over.
Why put another constraint on players’ earning power?
Exactly, gbs. I’m not a fan of restricting players’ earning power while the revenue will increase exponentially in years to come.
It needs to be adjusted to work with inflation. There also needs to be a floor of $100/million minimum. I feel like increasing it to $250 is reasonable at this point. Especially since they will be creating 15 new jobs once the DH is adopted in the NL.
I agree that a 100 floor and 250 soft cap is probably reasonable, but I don’t at all like the idea of the penalty not increasing year by year or the amount of money going to the small market teams going down. Those things will hurt parity, especially with the moves to make free agency happening sooner
I’d like to see how average ticket prices have gone up in relation to average salary.
How about how they’ve gone down when teams tank and slash payroll? The correlation would be poor.
Split the difference and let’s move on. This looks like one area where they should be able to come to an agreement rather quickly. Only real sticking point I can see is what to do with multiple year offenders. From the players side, I wouldn’t want to see teams do a reset to try to duck back under the tax.
The more i read about this, I’m really on the owners’ side. They offered no DH and Salary floor, both of which should help with ever increasing contracts and many of the contracts this year have been huge.
The players want the luxury tax threshold to go up significantly, NOT have an increase for repeat offenders, and have less paid to the smaller market teams. All of those things, combined with reaching free agency earlier, will hurt parity.
The DH in the NL would be an increase of $5 million in salary per team. A total of $75 million. All the players had to do to get that was to give the owners expanded playoffs that would have added a half billion in the owners pockets with no additional money going to the players for those playoffs.
The salary floor the owners offered was $80 million. All teams have $250 million in revenue now. Even the smallest market team can afford player payroll of $120-$130 million easily.
There’s been a slow down in the luxury tax/soft cap (CBT) threshold over the last decade, and indeed, the introduction of two additional luxury tax tiers is contributing to the players share of the revenue pie decreasing. The top end players are fine. It’s everyone else getting squeezed. Raising the luxury tax tier doesn’t cost the owners anything. It’s still in their control how much they want to spend. Their offer to increase the CBT by only $4M should be a non-starter because that will continue to squeeze all the players outside of the very top free agents. Whatever number they arrive at, however, should be indexed and increase every year. The players should have made that part of the plan when they originally agreed to the CBT.
I am on the side of the players here because the issue is tanking and the incentive to lose all comes from the owners side. The players are the only ones who can fix that.
It cost me 300 to 400 dollars to take my family to a single ballgame (decent seats, parking, drinks). It basically costs me one day’s pay to see 1 game. 3.5 hours. I pay 100 per hour. More and more I say it’s not worth iy I go to 1 game a year now. I used to go to around 6 to 10.
2022 – 225M$
2023 – 230M$
2024 – 235M$
2025 – 240M$
2026 – 245M$
That’s an annual increase of 2.16% which is the average yearly CPI increase over the past 20 years.
Have to have some kind of progressive penalty though for exceeding it.
Done….., do both agree? On to the next thing.
It’s hard to fathom just how incompetent Tony Clark is.
Clark is not negotiating this CBA. He was only involved in one negotiation for the last 5 year CBA.
As the article points out, the $210 million CBT in 2021 was ridiculously low. The players $245 million proposal on Wednesday is already a compromise from the $255 million they proposed in early negotiations.
The owner’s $214 million proposal is again ridiculous. Especially with the 4 top teams in revenue expected to top $600 million in 2022. Those teams can spend $250 million on CBT payroll & related expenses without blinking an eye.
Raise the CBT threshold to a reasonable number like $235 million with a floor of $110 million and tie the increases in both to inflation. Not player salary inflation as the owners are suggesting, since that is something the owners can artificially control.
Keep the progressive penalties for going over in successive years. Get rid of the progressive penalties for a single year, but make the penalty the 35% it was originally. Do away with any ties to draft pick or international free agency penalties including for signing free agents that have been given a QO.