Sunday, March 2, 2008

Where does the Yankee Revenue go?

If you wondered where all the Yankee revenue goes (other then the obvious) the answer is Jeffery Loria's pocket. Via the Biz of Baseball;

"The Marlins’ payroll for 2008 is projected to be around $20 million, the lowest in the league and $10 million lower than last season.

“It’s a function of revenues, and we were not really able to derive any revenues out of this facility,” Loria said of the team’s current home, Dolphin Stadium. “As we get closer to the (new) stadium, those things will change. We need to be in that facility.”

On the player payroll at $20 million, that would be $5 million less than what the club will receive in revenue-sharing, which is projected to be $25 million. Apparently, a “function of the revenues” is to make a mockery of the revenue-sharing system, and do a good bit of profit making.

Forbes estimated that the Marlins posted $43.3 million in operating income last year. That operating income included earnings before interest, taxes, depreciation and amortization. How did the Marlins rate in terms of operating income – a measure of profit – compared to their other 29 counterparts? They were first with the Dodgers in second at $25.5 million, a difference of 41 percent.

If there is one thing that Bud Selig has failed at in his tenure as Commissioner (no, not steroids) it's the abuse of the revenue system by certain clubs - most notably the Marlins. I posted an article awhile back stating that the current system rewards teams that are not successful locally. Basically, pocket the revenue money and your profits grow; invest it in your team and your revenue sharing number and your margins shrink.

As a Yankee fan, I understand our revenues are so enormous that we have to contribute some to level the playing field. When that money is used instead to make owners rich, however, I have a real problem with it. I imagine The Hank must feel even stronger about it. I am glad to see that some of the money will be taken away from the Marlins with their new stadium.

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