Frank Coonelly and MLB Respond to Revenue Sharing Concerns

Jeff Passan from Yahoo Sports posted an article last night about the MLB Players Association looking into the revenue sharing spending from the Miami Marlins and the Pittsburgh Pirates. According to Passan, the MLBPA was considering whether or not to file grievances against the two teams.

Pirates President Frank Coonelly responded to the article this evening, saying that the Pirates are not be investigated by MLB and the Commissioner has no concerns over how the Pirates are spending their revenue sharing money. He notes that the Pirates are required to detail each year how they spend revenue sharing money. The full response from Coonelly can be read below. Click on picture to enlarge.

 

 

 

 

 

 

 

 

MLB had their own statement in regards to the report:

“We do not have concerns about the Pirates’ and Marlins’ compliance with the Basic Agreement provisions regarding the use of revenue sharing proceeds. The Pirates have steadily increased their payroll over the years while at the same time decreasing their revenue sharing. The Marlins’ ownership purchased a team that incurred substantial financial losses the prior two seasons, and even with revenue sharing and significant expense reduction, the team is projected to lose money in 2018. The Union has not informed us that it intends to file a grievance against either team.”

  • BuccosFanStuckinMD
    January 29, 2018 9:35 am
  • Much to do about nothing. How long has Nutting owned the team? Has their been any instance or clue that he as an owner that was going to join the big spender club in the MLB? Answer is NO.

    So I guess I am in the minority on this but I just wish when the subject of Nutting’s spending comes up to just move on. This team has a budget plain and simple and it’s nowhere near what is ever going to be considered adequate by many of the fans. In fact I would guess if the Pirates allocated 150 mil/year some would complain about that.

    Huntington knows what his budget is and he has to do a better job allocating that year to year.

    • That’s a bit too simplistic a stance to take for most people. Accept a mystery team budget known only to ownership and his management team and “just move on?” That is a publicly funded stadium, one of the best in baseball. Revenues have increased across the board in baseball. The value of the franchise has increased 10x. Payroll is down in 2017 and 2018 from 2016 levels. The Pirates have received special distributions from the MLB asset sale to Disney of approximately $80M. The Pirates are under intense scrutiny not just from their fans but nationally for a strategy that puts profits in front of winning.

      Nobody is saying Nutting has an obligation to lose money. Under the CBA, revenue sharing was designed to promote COMPETITION, not a higher profit margin. And frankly, Bob, Frank and Neal make everything worse with their inability to talk straight.

  • Is this all the coverage this matter will have on this site?

  • The players union wants a salary floor but no ceiling. I am hoping this offseason will remind them that there are advantages to the combined floor/ceiling models.

    I would estimate about a third of owners would oppose a cap/floor.

    I think the real issue would be percentage of revenues going to player salaries. I believe I have heard that the number is currently around 40%

  • Scott Boras yells JUMP, and MLBPA responds HOW HIGH!

    Taking his frustrations of so many of his clients not getting deals this winter out on his favorite whipping post, Bob Nutting. That’s my take on this issue.

    • More than a little truth to that aspect of it Scott. Far be it for me to try nd cover for Coonelly, but this is almost funny. I wonder how hard he is trying to sell Arrieta to the Nats ?

  • I am honestly quite interested in what the Pirates choose to do with their current payroll where it is and it presents several options. If the team doesn’t like to go big when they are in a position to compete, perhaps they would be more comfortable staying in the $90-$100m range while they retool.
    1) It seems to me the Pirates are in a position to do what the Blue Jays did with the Pirates a few years ago – take on a few bad contracts in exchange for prospects. They got their “safe” pickups in the trades for Cole and Cutch, so why not grab a pile of higher risk / higher reward guys or international pool money in taking on some salary? The Yankees and Giants seem to be 2 teams that could use some wiggle room under the cap.
    2) If they are going to trade Harrison, why not include $10m in the trade and make him a huge value for a team that is picking him up. I think the Mets would budge on Nimmo and add a few lower level lottery picks if Pittsburgh included a big chunk of money in the deal.
    3) With the slow speed of the free agent signings and spring training so close, some players may take a discount for a 1 year contract. The Pirates could scoop up some deals and if they are in it at the break, go for it. If not, they could use all of these assets to trade at the deadline for more players that can help the MLB club in 2019.

    • So here are a couple higher salary guys they could possibly take on: Ian Kennedy, Yasmany Tomas, James Sheilds, starlin Castro, Wei-Yin Chen, Martin Prado, chase Headley, and maybe some others…

  • This is exactly the response I expected from MLB and the Pirates. It was a fricking joke that MLBPA would even bring this up, there is zero chance they could prove anything.

    • Not sure the Players Union is all that serious. Just trying to put a little pressure on teams and show players they are doing something. Much ado about nothing. If they want to bitch, they should bitch about the Dodgers dropping under the luxury tax limit this year.

  • One time I received a $20 Amazon gift card as a gift. A couple days later I needed to order something on Amazon. I was just about to purchase it out of pocket, when I thought, wait, I have that Amazon gift card which I have to use at Amazon, whereas my cash is good anywhere. So, I bought the item with the gift card and just pocketed the cash for bar money. Hey, I still spent $20 at Amazon, and I have a receipt to prove it!

    • I tried to down vote you, but I don’t think it works. I just want you to know that I have no idea what you’re trying to say.

      • Yeh I guess the metaphor I was going for didn’t come out all that clear haha.

        Gift card = rev share
        Amazon = MLB

        So they came out and said they spent the re share money, which I’m sure they did as required, but spending that earmarked money allowed them to not spend that amount of money out-of-pocket somewhere else. At least, that was my cynical comment 4 hours ago. I guess I don’t know the details of if they must spend that full amount on top of their previous year’s payroll or something.

  • This is the confirmation that this team will never be a contender with this leadership. It’s kind of like when the Judge says “the jury will disregard the prior statement.” Ain’t gonna happen.

    • Please stop bitching! The Pirates just recently had 3 consecutive years of postseason appearances. During 2013-2015, The Pirates didn’t trade their top prospects, and I really like that. I am eager to see the new guys play and get better. Accept that The Yankees and Astros refused to trade their elite prospects. Move on! Just move on and support the The Pirates! Many new and exciting Stars will take the field in a Pirates Uniform in 2018-2019, and years going forward. I am Proud to be a Pirates Fan!!!

      • Good points, and the folks traded (‘Cutch and Cole) were guys we knew we were losing. Trying to get some return before they leave is what a good management team does. And there are still a few left like Harrison and Rodriguez that will be gone sometime between today and Aug 1.

        The sooner the better and allow guys like Moran, Osuna, Luplow, Newman and Kramer increased opportunities to cut their teeth at the MLB Level in 2018. No more of the Hurdle BS about “these veterans give us the best opportunity to win”. That ship has sailed – play the kids.

        • Hurdle will find a way to not play young guys

        • You’re nuts if you think Moran, Osuna, or Luplow ever produce like Cutch or Cole. I’m not sure any of them are as good as Rodriguez. Do you watch the games?

      • Neal is looking for a driver to take him to games in Morgantown once a week. In return for each trip you get a T-shirt, two tickets to a weekday game, and all the Kool-Aid you can drink. And half the mileage allowance.

      • Wow…

      • Thank you! A voice of reason in a sea of lunacy!

  • Buy prospects from the Dodgers by taking on Matt Kemp and DFAing him immediately. foolproof!

  • LIAR! 🙂

    Just giving you a hard time Frankie, but I do think we’ve learned to take most of what you say with mountain sized grain of salt.

    • Haha! I think I’m going to believe him here because MLB generally backed up his statement. (Then again if they DID have a problem with their spending, I’m certain they wouldn’t tell us. Oh god I need my meds.)

  • Generally corporations don’t respond and deny something unless they did it, there’s no real need to validate something so absurd by discussing it. Straight up they put the money in their pockets not the team.

    • How do the Pirates total revenue compare to the rest MLB?

      What % of payroll compared to total total revenue?

      What about the rest of MLB?

      • You can’t probably google this to confirm but the major sports spend about 50% of revenue on its pro payroll. So NHL/NBA is ~50%, excluding minors / D league. NFL is down to 47% because of the new CBA, but that will likely go back up in the next CBA.

        MLB teams are historically around 50% as well, not including minors or drafts. That would mean that the Bucs should have spent approximately 50% x $250M = $125M in 2016 payroll. They spent well less than that, obviously.

        Therein lies the rub… where does that extra $10-25M go? Hard to disprove the fan theory that it’s going into the owners pockets. I honestly have no plausible theory other than that. (any ideas out there?) Unless the Pirates are just that much worse/less efficient at running baseball operations, which I find hard to believe. And it’s not like the Pirates are spending tens of millions more on scouting and analytics. That’s a stupid assertion by Frank C to cover their footprints.

        No law against owners pocketing the money of course. Rich guys getting richer… while we continue to root for a team with the economic cards already stacked against us, and the owner making it even harder to make up the difference by spending at lower relative levels than any professional sport does.

        Can’t wait for the season! :/

        • If the Pirates take in $250,000,000 / year and spend $100,000,000 on players payroll it leaves $150,000,000 for profits, scouting, player development, rent, equipment travel, etc. A team taking in $300,000,000 / year can pay $150,000,000 a year on profits and expenses and still spend $150,000,000 on players(50% of intake). Pirates attendance- 1,919,447: Brewers attendance- 2,558,722: Cards-3,447,937,K.C-2,220,370. So many of the posters and talk show hosts and callers have a simple answer- don’t go to the games. I hope they will enjoy rooting for the Nashville Cats.

          • The problem for me is a front office that trades its best player and pitcher and says they still plan to compete and be successful, and that they are “too talented to be in a rebuild.” It’s not the most eloquent way to put it but they are getting high on the smell of their own gas like the South Park episode. This front office is smart. Just ask them. I might be wrong but this front office has never signed a 5 war player. Cutch and Marte came in Littlefield era right? Cole produced one 4.5 WAR and nothing else close. That is the flagship season they have drafted and saw through from beginning. We produced one 4+ war season in 10 years! Extensions for everyone!

        • “Extra”? Would you run an organization with millions in liability and requiring 24/7 work to not make a dime? It’s called profit.

    • Maybe, maybe not, but you’re certainly jumping to a conclusion there.

  • I didn’t know revenue sharing decreases as local revenue increase. So the Pirates have been probably spending more than I gave them credit for, lol.

    • I think Oakland actually was removed from receiving revenue sharing recently.

      • I thought it was because they aren’t a small market team (bay area market size) and because owners thought that they weren’t spending enough to be competitive? Do teams eventually graduate from revenue sharing?

        • You’re probably correct. I just remembered reading about them being fazed out of it. I would assume a team could eventually graduate from it but I doubt it would happen very often.

          • And the amount of the revenue to be shared could decrease if the Bigs decide not to shop for expensive FA’s, thereby staying underneath the payroll penalty level which this year is set at $197 mil.

            I think the Yankees and Dodgers have exceeded it twice and are paying a 30% penalty which came due about a week ago. If they exceeded that again this year, the penalty would rise to 50%. OTOH, if they stay under the $197 mil this year, the penalty resets back to zero, and wipes out the years the team went over the spending limit.

            A convoluted system where you could say the Pirates are on MLB Welfare – it is subsistence at best.

      • At least part of the reason for Oakland being removed from revenue sharing is because of their stadium situation which has been a mess for at least a decade. This is a way for the other owners to force the residents of Oakland to build a new stadium or have the team move elsewhere. The A’s tried to move to San Jose and MLB and the Giants blocked them.

  • Tim,

    Do you Pirates spend money on each farm team? Read somewhere Pirates revenue was like $260 or so million for the year. I’m guessing they spend about 10 million in MLB draft signing bonus each season, and another 3-5 million for international players signing bonus.

    And they pay to operate the park in the Dominican Republic.

    With insurance on MLB contracts and Low local TV revenue.

    Plus pay all the scouts, front office personal, and staduim staff.

    Do you also pay to operate the spring Training ?

    When is the local TV revenue contract up for renewal?

    I saw Yankees had over 500 million in total revenue But only spend about 200-215 million on players Salaries.

    Seems like the top Revenue teams pocket over 200 million…

    Pirates seem pretty stick, until revenues go up?

    I expect attendence will fall from 1.9 million fans without McCutchen and Cole maybe down to 1.4 to 1.5 million fans this season, which probably results in say 15-25 million in lost revenue.

    How do the Pirates ever get a competitive advantage?

    Thanks

    • You sir are a genius. Thank you for being a true Pirate fan!!!

    • If the Bucs somehow pitch well with the 4 horses they have plus the 1 wildcard, they could stay relevant in the race. I think fans will come back with Bell and Taillon being the new young Stars. When the Pirates had the winning seasons, it was really based more on Starting Pitching, Defense, and keeping the scores low. It was never based the bucs on scoring a bunch of runs.

      Concerns of course will be fans that watch Cutch and Cole with their new teams and see how they’re doing as well. If cutch struggles again, then the front office will feel vindicated for that trade. If he hits well, then the Fans wlll be upset. As far as Cole, IMO, that trade will depend on how he pitches and not his wins because the Astros can score runs.

    • Whenever a team like the Pirates get a small competitive advantage the rules get changed. The Bucs spent big money on Josh Bell and other college-bound players and convinced them to enter pro ball. Then overslot spending on draft picks becomes reigned in (nice job on Mason Martin pick despite rules). The Pirates find an advantage in low ball pitchers then the umpires quit calling the low strike and your stable of sinker-ball pitchers and your entire minor league approach to pitching is obsolete. Slowing the time between pitches to disrupt hitters timing – Bastardo and Melancon- is now outlawed. Loading up on power arm short-stint relief pitchers is an approach the Pirates are positioned for. However, the rules people are going to shut that down soon Teams have learned how to beat the shift so that advantage is gone but the rules people have talked about limiting where a manager can position his fielders. Pirate management has done well swimming against a current that is directed to keep them sucked in the whirlpool of no contention.

    • This logic doesn’t fit with the class envy of the yinzer

  • Methinks thou dost protest too much. Sounding pretty defensive there Frank.

  • Darn. 🙂

    I may be cynical, but there seems to be a lot of half truths and double talk in Frankie’s statement?

  • I love the NHL salary cap with a ceiling and floor. Do you think MLB will ever develop some more effective balance?

    • Fans of small market teams can dream.

      • WillyMoGarcia33
        January 26, 2018 10:45 pm

        Well, the disparity between large and small markets in the NHL is what lead to the hard caps. So, you never know.

        • Especially with the bone dry free agent market this year, it actually would behoove the players to agree to/propose a hard cap and floor.

          MLB players now receive the lowest percentage of revenue (40%) in the four major sports.

          No cap is still great for the best/richest players, but for the average rank and file it is not.

          However, now that the owners can get away with 40 percent payrolls, why would they want a hard cap/floor?

    • Not in the near future, because the Player’s Association will never allow it. In order to get any type of salary cap, the owners would have to be willing to take on the union which could mean throwing away a season or 2. The owner’s currently are not willing to do that. Maybe someday they will be willing to do that, but I doubt you will see that in the next 10 years.

      • The Pirate ownership would vote against a cap.

      • The Union would do well to get a cap/floor system, because depending on where the floor was set, it would likely improve middling players’ odds of getting good contracts. I think the owners are the ones who don’t want that system, since it would give the players more control over how money is spent, and thus an opportunity to increase the players’ share of the revenue.

    • It will never happen because they players would have to agree to limit their own pay. Plus it’s a nightmare for good teams that develop players in that they can’t afford to keep their players that they develop and are constantly trading players for cap relief. i.e. Chicago Blackhawks
      The NBA would be a better model.

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