Why aren't finances adding up?

[Orcin]

Originally Posted by Jordan

I agree that it should work that way, but is it supposed to work that way in the middle of the first season of a save, for example?

I don't know what the developers intend. Matt said he would look into it. Presumably, he will tell us when he completes his review.

[Le Grande Orange]

Originally Posted by Orcin

The rule takes 48% of the revenue from every team and puts it into a pool, which is then reallocated to every team in equal portions (1/30 of the pool amount to each team). Teams with large revenue streams will lose money and smaller revenue teams will gain money. For most teams in the middle, it is a relatively minor amount one way or the other.

PRO:
- consistent with current MLB rules
- gives small market teams an economic benefit to balance the playing field

It's actually not consistent with current revenue sharing rules. That 48% figure is not the percentage of each club's local revenue which is shared; it is used to calculate the total amount of money transferred from paying teams to receiving teams. Here is how revenue sharing works as of the 2022 CBA. This example shows the steps used to determine the revenue sharing for the 2024 MLB season.

(1) Each team contributes 48% of its 2023 local revenue into a virtual pool, and each club takes out an equal share. The difference between what a club puts into and gets out of the virtual pool determines whether it is a paying or receiving club. Sum up the amount paid by the paying teams. This is the Net Transfer Value.

(2) Each team contributes to a virtual pool a blended average consisting of the following: 50% of its 2023 local revenue, 25% of its 2022 local revenue, and 25% of its 2021 local revenue. Each team takes out of the virtual pool an equal share. The difference between what a club puts into and takes out of the virtual pool determines whether it is a paying or receiving club.

(3) For each paying club, take the amount paid and divide it by the total amount paid by the paying teams from the virtual pool in Step 2. For each receiving club, take the amount received and divide it by the total amount received by the receiving teams from the virtual pool in Step 2. The resulting figures are each club's Transfer Percentage.

(4) Take each club's Transfer Percentage and multiply it by the Net Transfer Value from Step 1. This determines the amount each club will pay or receive during the 2024 season.

The steps above sound more complicated than they really are.


There are also a couple additional real life considerations:

(a) Clubs with a market score of 100 or higher are disqualified from receiving revenue sharing. Any amount that such disqualified clubs would have received is refunded to paying teams based on its Transfer Percentage and the total amount being refunded.

(b) Clubs which are eligible for the refund mentioned above may forfeit some or all of that refund if it was a Luxury Tax payor. The determination is fairly complicated.

[Orcin]

Originally Posted by Le Grande Orange

It's actually not consistent with current revenue sharing rules.

By "consistent", I meant that it was closer to reality than no revenue sharing at all.

[kidd_05_u2]

Originally Posted by kidd_05_u2

At least in my ongoing MLB 2023 save, the changes added new revenue sharing money into the cash to spend of the low-revenue teams, and subtracted a lot of money from the high-revenue teams.

Originally Posted by Orcin

That's how it is supposed to work.

No.

When you have the owner setting the budget, the revenue-sharing money should come BEFORE the owner takes/injects cash into the team to set the starting cash balance for the next season.
We even have a setting to limit the max amount of cash the owner will let you keep for the next season to prevent cases like my example, where poor teams would suddenly get tons of cash to spend due to revenue sharing.

What the changes did is allow poor teams to spend massive sums on account of future revenue sharing, even though the owner should be pocketing most of those revenues. The changes also force rich team to have to slash spending on account of future revenue-sharing payments, even though those payments will be covered by the owner.

I mean, the standard MLB game is basically telling the Yankees and the Mets that they should trade away 2-3 of their best players from day 1 because they can't afford them, and it is telling the Oakland As that they can afford trading for Judge and Gerrit Cole together. If you think that is how revenue sharing is supposed to work...

[Le Grande Orange]

Originally Posted by Orcin

By "consistent", I meant that it was closer to reality than no revenue sharing at all.

Well, yes, under that interpretation.

Awhile back I went through the CBAs looking at the revenue sharing plans over the years and set up an Excel file to test out each plan's result using the real-life local revenue values from the 2000 Blue Ribbon Panel report. It was interesting. Which plan was better would be up to the individual to decide.

[Orcin]

Originally Posted by kidd_05_u2

If you think that is how revenue sharing is supposed to work...

Why have revenue sharing at all if it has no effect on the spending of small market teams vs. large market teams? You might as well disable the feature because it does nothing to change the game. We don't get to see what the owner does with the phantom money.

During the recent CBA negotiations, the players argued that the small market teams should not be allowed to "pocket the money" and instead should be required to invest the revenue sharing proceeds into payroll. This would obviously benefit the players via increasing salaries, but it would also increase competition. The NFL does something like this via their salary cap floor.

I am not a developer so I don't know why they chose to have revenue sharing apply to the first game year. Maybe they think it was broken before and this was intended to fix it or perhaps it is a programming error. Matt said he would review the feature, so presumably he will come back to one of these threads and either explain why it is working as intended or tell us that he is planning a revision to satisfy your concern.

P.S. I took a pic of the Mets opening accounting screen in the standard MLB game. The revenue is $325M and the expenses are $335M with bare minimum scouting and player development. Do you really think that any owner would allow further payroll spending in that situation? They are already paying $20M in luxury tax on top of the $335M.

[jmuelly]

I'm so confused now.

[kidd_05_u2]

Originally Posted by Orcin

P.S. I took a pic of the Mets opening accounting screen in the standard MLB game. The revenue is $325M and the expenses are $335M with bare minimum scouting and player development. Do you really think that any owner would allow further payroll spending in that situation? They are already paying $20M in luxury tax on top of the $335M.

Attachment 963287

From your screenshot:

The owner gave the Mets 350mn to spend.

The Mets are spending 335mn, some 15mn below their budget

The Game will not allow the Mets to spend a single dollar more unless they first cut 60mn from what they are spending.

The Mets would need to get their spending down to 275mn (trade Scherzer and Verlander) before they can offer one minimum contract.

If you don't see the problem with this description, it is hopeless to keep this discussion going.

[Orcin]

Originally Posted by kidd_05_u2

From your screenshot:

The owner gave the Mets 350mn to spend.

The Mets are spending 335mn, some 15mn below their budget

The Game will not allow the Mets to spend a single dollar more unless they first cut 60mn from what they are spending.

The Mets would need to get their payroll down to 275mn (trade Scherzer and Verlander) before they can offer one minimum contract.

If you don't see the problem with this description, it is hopeless to keep this discussion going.

The Mets are spending $355M including the luxury tax. That is an expense that has already been committed. But you are right. It is hopeless to keep this discussion going if you don't see the problem with this situation.

[Matt Arnold]

We'll have a patch out sometime shortly that should correct some of these issues. The general change will be when owners control budgets, it will be back to more or less what it used to be. When the full revenue available setting is used, then revenue sharing will continue to play a part in available money calculations (although even there we are cleaning up and clarifying some calculations)

[Jordan]

Originally Posted by Matt Arnold

We'll have a patch out sometime shortly that should correct some of these issues. The general change will be when owners control budgets, it will be back to more or less what it used to be. When the full revenue available setting is used, then revenue sharing will continue to play a part in available money calculations (although even there we are cleaning up and clarifying some calculations)

Thanks. Will this clean up calculations in season? Or is there some official recommended action, depending on settings of course?

[Matt Arnold]

Originally Posted by Jordan

Thanks. Will this clean up calculations in season? Or is there some official recommended action, depending on settings of course?

It should correct immediately, pretty much (maybe you will have to sim ahead a day after updating to see the changes).

[jmuelly]

Originally Posted by Matt Arnold

It should correct immediately, pretty much (maybe you will have to sim ahead a day after updating to see the changes).

Thanks, been waiting to get started with my post season push live start and many year simulation. Think I’ll hold off until this patch drops.

[Orcin]

Originally Posted by kidd_05_u2

From your screenshot:

The owner gave the Mets 350mn to spend.

The Mets are spending 335mn, some 15mn below their budget

The Game will not allow the Mets to spend a single dollar more unless they first cut 60mn from what they are spending.

The Mets would need to get their spending down to 275mn (trade Scherzer and Verlander) before they can offer one minimum contract.

If you don't see the problem with this description, it is hopeless to keep this discussion going.

With the new public beta, the Mets can now spend that $15 million and it appears the problem that you reported is fixed. Good luck!

[kidd_05_u2]

Originally Posted by Orcin

With the new public beta, the Mets can now spend that $15 million and it appears the problem that you reported is fixed. Good luck!

Yeah that was a quick fix thankfully. Good luck to you too.