This is a pretty knowledgeable group

[rburgh]

I saw a brief mention on MLBTR that the A's need to get their payroll up over $100 million in order to collect their revenue sharing in full. Is this correct? Does anyone have a link to the revenue sharing part of the CBA?

[kq76]

I don't see a reference to $100M (in text or numbers) in the CBA, other than the with regard to debt service (how much debt teams are allowed to have / need not go over) on pg 242.

There are, however, some references to the Athletics in the CBA (I don't think you typically see teams singled out in the CBA). For example, on page 149, which is in the revenue sharing section, it has this:

(12) Clubs with a Market Score greater than 100, as reflected in
Attachment 26, shall be fully disqualified from receiving revenue
sharing in the 2022-26 Revenue Sharing Years, except as set forth in
Section A(11) above; provided, however, that the Oakland Athletics
shall not be fully disqualified from receiving revenue sharing during
this period, but rather shall be 75% disqualified in the 2022 Revenue
Sharing Year; 50% disqualified in the 2023 Revenue Sharing Year;
25% disqualified in the 2024 Revenue Sharing Year; and fully eligible to receive revenue sharing (i.e., the Oakland Athletics will be
treated as if the Club’s Market Score were 100 or less) beginning
with the 2025 Revenue Sharing Year. Notwithstanding the foregoing,
if, by January 15, 2024, the Athletics have not entered into a binding
agreement in Oakland or another city to construct a new Major
League Baseball facility to host Athletics championship season
games, the Athletics shall be fully disqualified from receiving revenue sharing beginning with the 2024 Revenue Sharing Year.

Might what you're talking about be somewhere else? Maybe, but I don't think it's in the CBA.

EDIT: It might be in there where they talk about how to calculate how they determine how other teams qualify or don't, but I'm not willing to dive that far.

[dannibalcorpse]

Originally Posted by rburgh

I saw a brief mention on MLBTR that the A's need to get their payroll up over $100 million in order to collect their revenue sharing in full. Is this correct? Does anyone have a link to the revenue sharing part of the CBA?

I don't have the links to the exact spot of the CBA that outlines this, but the general gist I have seen is that a revenue sharing club is expected to spend 150% of the money it gets from RS on the MLB payroll; since the Athletics received $70M this season from revenue sharing, they *should* be carrying a payroll of $105M.

Per Ken Rosenthal/Evan Drellich at the Athletic, there's no defined penalty for not reaching that level, but it does allow the MLBPA to file a grievance against that club and put them in a position where they may have to justify how they are using that revenue sharing money. Usually this seems to be done as a bargaining tactic for CBA negotiations - i.e,, the MLBPA drops any pending grievance in return for some sort of concession from the ownership side. One could potentially argue that the revenue sharing formula may have been one of those concessions, because prior to the current CBA a revenue sharing recipient was only required to spend to 125% of the money they received (but that's just conjecture on my part.)

(edited to add-) The Athletics are still going to receive their full $70M but they are potentially in a bad position with the union if their payroll doesn't hit that $105M mark.

[rburgh]

I think that's it. The RS pool is 48% of all local revenue (tickets, broadcast, etc.) and the teams are required to spend 150% of that.


Hence $22+ million a year for a mid-rotation starter.

[kq76]

Originally Posted by dannibalcorpse

a revenue sharing club is expected to spend 150% of the money it gets from RS on the MLB payroll; since the Athletics received $70M this season from revenue sharing, they *should* be carrying a payroll of $105M.

Yeah, that's it. Brodie Brazil uploaded a pretty clear video on it this morning.

At first I thought maybe it was something specific to the As, but no, it's like I later thought, it's something that is expected of every club, it's just that the As' payroll is so low that this is an issue.

EDIT: Man, they're so cheap. Something like 67% of their payroll is being paid by the other clubs! 35 or so million to field a MLB team in 2024 while the Yankees and Mets are both fielding teams over 300M? And some thought the gap was bad before.

[Le Grande Orange]

Originally Posted by rburgh

The RS pool is 48% of all local revenue (tickets, broadcast, etc.) . . .

The amount of money transferred in total from paying teams to receiving teams is based on a 48% straight pool from the prior year (the 'net transfer value'); the actual amount a team pays or receives is based on a different formula.

A putative pool is created based on each team's net local revenue (total local revenue minus its stadium operating expenses) consisting of 50% of its net local revenue from the prior year, 25% from two years prior, and 25% from three years prior. This blended pool is divided equally between all teams. The amount each team pays or receives under this plan is divided by the total amount transferred to determine its transfer percentage. This percentage is then multiplied by the net transfer value from the preceding paragraph to determine the dollar amount each team either pays or receives.

Lastly, any team calculated to receive funds but which is disqualified from receiving revenue sharing has that money refunded to the paying teams in proportion to how much each payor contributed. Such refunds may be partially or fully forfeited if the payor team exceeded the luxury tax payroll threshold in one or more prior years. A total of 11 teams are fully disqualified from receiving revenue sharing: NYA, NYN, ANA, LAN, CHA, CHN, TOR, SFN, WAS, PHI, and BOS. OAK can be partially or fully disqualified depending on certain criteria.

Originally Posted by rburgh

. . . and the teams are required to spend 150% of that.

This appears in the last paragraph of Article XXIV(B)(5)(a):

The Association has the burden in any proceeding under the Grievance Procedure of demonstrating that the Club’s use of its revenue sharing receipts was in violation of this subparagraph 5(a). In any such Grievance, the Arbitration Panel shall consider, among other things: (i) the Club’s expenditures on scouting, player development, and player payroll; (ii) the Club’s long-term strategy for improving competitiveness; (iii) the uses that the Club has historically made of revenue sharing receipts; (iv) any material adverse changes in local revenue; and (v) the overall financial position of the Club. Notwithstanding the above, if a Club’s Actual Club Payroll pursuant to Article XXIII(C) is equal to less than 150% of its revenue sharing receipts in a given Revenue Sharing Year, the Club shall have the burden of establishing in any Grievance that its use of revenue sharing receipts was consistent with this subparagraph 5(a).

Note that club payroll here refers to its luxury tax payroll, not its actual payroll. The former uses the average annual value of contacts, pro-rated signing bonuses and contract buyouts, and each team's share of player benefits, which in 2023 was $17 million. Oakland's luxury tax payroll versus its final team payroll for the last two seasons:

2022 = 65,325,365 | 49,066,454
2023 = 81,759,852 | 62,678,156

The 2024 figures are not yet available.

[Cod]

From the recent owners' meetings, there were grumblings of a few payors venting frustrations towards Fischer regarding his revenue sharing spend ratio. So there's a lot of things at play here like the CBA rules previously mentioned, owners starting to get frustrated, etc. There's also the need to get more backing in Vegas to build the stadium, which will require spending now to entice the right people.