All these years we thought that with winning came success. Put the best team on the field and fans would turnout, they would fill the stadium and life would be good for the franchise as well as the ownership group.
Well our friends at Deadspin this week posted leaked financial documents from a handful of Major League Baseball teams and — it might surprise you — losing is a profitable business for some teams.
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It seems that the Pirates and the Marlins are baseball’s version of Mel Brooks’ famous movie and Broadway hit “The Producers” where losing equaled making money.
The Pittsburgh Pirates who clinched their 17th consecutive losing season, a new record for any North American sports franchise. The Pirates have refused to sell the team to a group headed by Mark Cuban and another one led by Chuck Greenberg both natives of Pittsburgh who wanted restore the team the role of a contender.
Meanwhile Pirates earned $29.4 million in 2007 and 2008 — taking $69.3 million in revenue sharing during that period. Pittsburgh has the lowest team payroll in baseball, they have chosen to use revenue sharing for player development, and they spent $44.3 million in 2007 and 2008. “Even when we’re winning, we will be a revenue-sharing recipient,” Frank Coonelly, the Pirates’ president, told the AP.
But while the Pirates have been bad, it was the Marlins who used their “poor small market team” status to get Dade County to build them a new stadium with a small contribution from the team. But documents showed that Florida received nearly $92 million in revenue sharing in 2008 and 2009,while producing net income of $33 million in those years. The importance of the revenue-sharing money is underscored by the team’s gate receipts in 2008 ($20.9 million) and 2009 ($21.5 million) hardly a poor team, or at least as poor as they let the folks of Dade County think.
A Ray of hope came from Tampa Bay who got more than $39 million in ’07 and more than $35 million in ’08 from revenue sharing. But The Rays had a net operating profit of $11 million in ’07 and $4 million in ’08. Most recall the Rays increased payroll in 2008 when they went to World Series and again in 2009 when they remained competitive showing that the system can work with a wise management.
