August 23, 2010
Everyone in the baseball blogosphere has turned into a CPA this morning as the usually top secret financial details from a few major league teams have been leaked to the public.
Chief among the revelations is that the Pittsburgh Pirates have been collecting substantial amounts of cash — the AP says a total of $29.4 million over 2007 and '08 — while slinking their way to 18 straight losing seasons. Yes, revenue sharing has been very good to Bucs owner Bob Nutting and friends.
If you're interested in seeing all the blood and guts of the ledger, our pal Maury Brown at Biz of Baseball has already done a great job of translating the revealed reports for those of us not used to bean counting on the job.
And if you're interested in crying bloody murder over the whole thing, Bucs Dugout actually has a persuasive piece on why Pirates fans shouldn't be trying to force Nutting to walk the plank.
My take is that I understand the initial impulses of some to condemn the Pirates owners as shoddy caretakers of what is essentially considered by Bucs fans as a public trust.
It's a great thing, then, that the paying public now have a window into how the Pirates — and the other clubs — allocate all the revenue that's pouring in from different streams. That knowledge gives consumers a better idea on if the Pirates are the type of business they want to patronize and also puts more pressure on the Pirates to create a desirable product going forward.
As Rob Iracane of Walkoff Walk notes, an extra $10 million here or there doesn't mean that the Pirates are passing on signing the A-Rods of the world. But it does allow the club to better invest in things like draft pick signings and scouting complexes, expenditures that the Pirates are citing in their response to the release of the financial details.
The one wild card, of course, in this whole story is that a good portion of the Pirates' revenue is going to come in from league sources, regardless of how well they perform at the gate or in their local market. That they're not required to plow that pooled cash all back into the team is one of the downsides of an uncapped league and it's usually up to the league to hold them accountable so that they're not banking every last cent.
But now that the public has been allowed into the discussion — begrudgingly by the teams, I'm sure — we now have a better position to opine and advise from.