Wednesday, July 9, 2014

A's vs. Raiders Ultimatum Facing City Council, Fans

The A's lease imbroglio continues to fester in the sun, wafting an acrid smell into the Coliseum as the team thumps their neighbors across the Bay. The Oakland City council, with a lease approved by the JPA, is risking nuclear fallout from MLB Commissioner Bud Selig who has already issued a statement letting the A's move should the lease not be approved.

Meanwhile, the Giants are salivating at the prospect of having the Bay Area all to themselves and the Raiders are increasingly getting restless as they want to control development of the Coliseum site.

The one positive thing, in this complete and utter mess attributable to long-term neglect more than anything else, is that definitive resolution seems inevitable. The option of the A's and the Raiders continuing to share the Coliseum is no longer tenable. What the future holds is anyone's guess.

Relocation to Where?

It was interesting to hear Oakland City Councilman Larry Reid mention that the A's threat of relocation, assuming lease peace cannot be reached, is actually a real possibility.

Reid apparently mentioned Montreal and San Antonio as possibilities. Realistically, either destination would be a stretch. Here's why:

Montreal -- On the plus side, the city has a stadium available that could host MLB games. Olympic Stadium did so just this pre-season for two Mets-Jays tilts. However, Olympic Stadium would move the A's to arguably a worse facility than the Coliseum. Montreal is also, for all intents and purposes, prime Blue Jays marketing territory. MLB would be crazy, just plain crazy to allow a franchise to move to Montreal without having a new facility fully planned-out, funded and approved by the provincial government (an additional hurdle in Quebec). Also, consider if the A's moved to Montreal -- even temporarily -- realignment would just about need to happen. A real mess to consider.

San Antonio -- The Alamodome can, sort-of fit a baseball game in it. To call the facility Major League-ready is beyond a stretch. The Rangers consider San Antonio part of their marketing territory and would be sure to oppose such a move. Moving the A's to San Antonio would stack three AL West teams in Texas and in the Central Time Zone, making following road games harder for Angels and Mariners fans. A minor concern, as well, is that the A's would need to compensate the Padres for displacing that team's AA club.

It is far more likely that MLB would either ask the Giants to share ATT Park or that the A's would consider moving north to Sacramento.

Why Sacramento?

1. The A's would not need to compensate the River Cats as they are affiliated with the team.
2. Sacramento's media market (Sacramento-Stockton-Modesto) is robust, ranking at #20.
3. Raley Field, while still not MLB-ready, is arguably a better temporary facility than either Olympic Stadium or the Alamodome. (As a historical note, the Seattle Pilots in 1969 played in a AAA stadium and the Montreal Expos began their existence by playing at Jarry Park, also a minor league facility.)

In light of all of these machinations, the news in May that the River Cats are being courted by the Giants -- as their affiliation with the A's expires this season -- is all the more notable. After all, a minor tactic employed by the Giants in San Jose is use and ownership of the team's A-level club to partially block the A's. At the very least, ownership of the little Giants ensures the parent team extra compensation should the A's ever be granted the right to move.

If the A's and Giants swapped AAA locations, there is basically no chance that Fresno would be considered a spot for the A's to decamp to.

Affiliating with Sacramento, and investing in the team if possible, would be a savvy move by the Giants and further the team's ultimate goal -- elimination of a major competitor. Of course, on the other hand, blocking Sacramento might lead to temporally sharing ATT -- a Catch-22 for sure.

Choose and Lose

Anyone who thinks that Raiders owner Mark Davis and the Athletics ownership could join together and build Coliseum City is utterly naive. (They are doubly-naive if they include the Warriors ownership in the group as well.) Witness today's news that the Raiders development group has issued a letter to Oakland Mayor Jean Quan and the city council basically imploring the city to pick a side:

"the current proposal ... simply allows the A's to buy more time to find a site outside of Oakland ... and disrupt the ability to deliver a stadium for the Raiders and the ancillary developments adjacent to that stadium."

Read:

  • Approve the lease and risk the Raiders. 
  • Deny the lease and risk the A's.

It is also important to note that the Raiders want to knock down the Coliseum next year.

In a world of limitless funds, free of CEQA and where sports teams were all owned by owners more concerned with community harmony than money, Coliseum City might actually happen. This is not the world we live in today. Note the Raiders' letter's use of the phrase "ancillary development." Both teams want this because club revenues cannot be counted on given the ebbs and flows of attendance and the endless upward march of salaries.

The Coliseum, despite its historic playing field, is emblematic of the sort of hybrid-Frankenstein that trying to satisfy both a baseball and football team has produced. Has a stadium ever undergone a renovation so universally poor? Witness even the Raiders, the team it was expanded for, tarping off 10,000 seats this past season. "Mount Davis" is miserable in terms of sight lines and truly an architectural blight blocking out the Oakland hills. The real cherry, however, is that the city and county are on the hook for bond payments for years to come. As of early last year, about $100 million was still owed for this 1995 "renovation."

Make no mistake, the A's lease situation is fast becoming a showdown. It is understandable and laudable* to want all three Oakland-based pro teams to stay. The reality is that fans are fast being asked to choose sides and there are really only two potentially viable options: 1) save the A's; or 2) save the Raiders. (The Warriors are gone and have no interest in Coliseum area development.)

There is no middle ground and hoping for a "White Knight" to buy the A's, move them to the Howard Terminal site (one rejected by MLB) and thus somehow satisfy the Raiders by freeing the Coliseum just seems unrealistic and dangerous. Oakland simply can't "split the baby."

The latest sordid turn in this affair is that Raider and A's fans are now poised to be pitted against one another.

*Editor's Note -- My intention is not to question the passion of fans interested in keeping all of Oakland's teams. I have enormous respect with such groups and individuals. Personally, I may even agree with their end goals. However, passion and realism are sometimes opposing forces. Unless a major sea change occurs, vis-a-vis team ownership, it seems unrealistic that the city will save even two of these teams.

Thursday, June 26, 2014

A's Lease "Extension" Just Prolongs Team's Limbo

In terms of the A's "announced" 10-year lease extension with the JPA that oversees the O.co Coliseum, the devil is really in the details.

First, we don't even know that the lease extension has been finalized. Per this San Francisco Chronicle report by Carolyn Jones yesterday:

"We are still negotiating, so were surprised by the announcement of an agreement," [Oakland Mayor Jean Quan] said. "We plan to meet (Thursday), continue negotiations, and hope there will be an agreement soon."

OK. Keep that in mind.

The Associated Press report in circulation regarding the agreement has several very interesting quotes:

Baseball Commissioner Bud Selig commended both sides for reaching a deal on a lease extension, while offering, "I continue to believe that the Athletics need a new facility and am fully supportive of the club's view that the best site in Oakland is the Coliseum site."

A certain professional football team happens to feel the same way as well...

An additional quote:

"We very much appreciate Commissioner Selig's support for Oakland to be the home of the A's," coliseum authority Chairman Nate Miley added in a statement. "We also agree, and we believe the A's do as well, that long-term the Coliseum is the best site for them in the East Bay."

OK. Either Miley is either giving the A's the push in the A's-Raiders stadium game. or he still believes in Coliseum City and Santa Claus while we are at it. (Perhaps the latter can deliver the former?)

As previously detailed, the Howard Terminal plan was DOA and remains off-the-table with the current ownership group. A's owner Lew Wolff hammered in another -- if not the final -- nail in the proposed waterfront park with this quote:

"Howard Terminal as a potential ballpark site has been and is totally rejected by MLB and the A's," Wolff said in an email to The Associated Press.

Selig chimed in on the issue in a separate AP article:

"I continue to believe that the Athletics need a new facility and am fully supportive of the club's view that the best site in Oakland is the Coliseum site."

Beautiful renderings do not a ballpark project make.

So, is San Jose dead?

If you read the last quote by Selig carefully, you will note that he qualified his comment with "best site in Oakland (emphasis mine)."

The Oakland Tribune later did some editorializing of its own:

[Rhamesis] Muncada (Newballpark.org blogger), who had supported the A's now-defunct bid to move to San Jose, said the problem for Oakland and Alameda County "is that they want to retain all teams but don't have the resources to keep more than one, and they've been unwilling to choose between the two."

So, according to Tribune writer Matt O'Brien, the move to San Jose is "now-defunct." I wonder if long-time A's-to-San Jose champion and current San Jose mayoral candidate Sam Liccardo feels differently?

The Raiders

Muncada hits the nail on the head with his additional comments in the Tribune piece on the Raiders and A's vying for the same small pool of public funds and, more importantly, the same site:

[Muncada] who has been following the negotiations called the deal a "double edge sword because both the A's and the Raiders are competing for the single most feasible site." 

 "The Raiders and the A's are making statements to appear as if they aren't competing, but it's clearly evident (they are)," said Rhamesis Muncada, a San Jose resident who runs NewBallPark.org. "Raiders will take lease approval as a step toward siding with A's, moving Raiders out. A's will think the same if Raiders reach a deal to build Coliseum City." 

That same article also contains this caveat:

Oakland leaders had recently expressed some misgivings about details of the tentative deal. So did Raiders owner Mark Davis, whose vision for a new football stadium could be complicated by the long-term A's lease on the site the two teams share.

Waiting to Exhale/Much Ado About Nothing

Despite how it may be wrapped up by public officials, the A's lease extension is little more than a short-term solution. There is almost a zero percent chance that, barring massive investment, the A's will play at their current stadium into the 2020's. This fact makes Oakland Councilman Larry Reid's comment all the more amusing:

Fans should not exhale just yet, but you know, we're getting close.

Close to what? To an eventual showdown pitting the city's professional football and baseball interests? In truth, even with an inked extension, pro-Oakland A's fans are no closer to retaining the team in the long run.

Just listen to Wolff:

"I think it's a more-than-fair deal for both sides. There is an exit clause if the Raiders come through with whatever they're planning."

If you are planning on streaking down Broadway shouting,"The A's are staying!," you might want to hold off.

Tuesday, June 24, 2014

Interview with Nancy Finley, A Living Link to the A's 70's Dynasty

With all of the much-deserved pomp and circumstance of the recent '74 A's reunion, the conclusion of a rare three-year run as World Champions, nostalgia for the Charlie Finley-era teams is high. A steward of Finley's legacy is his niece Nancy Finley. Nancy has built one of the definitive virtual vaults for those looking to explore the A's 70's dynasty -- http://www.oaklandathleticshistory.com. Of course, her connection to the A's runs deeper than just her uncle. Nancy's father, Carl Finley, served as de facto general manager and vice president from the Kansas City days until the team's sale in 1980.

The following is an email interview. Nancy's comments (NF) have been lightly edited for clarity.

SMB: Your uncle, Charlie Finley, is essentially missing from the National Baseball Hall of Fame (HOF). Is he deserving of the honor?

NF: I definitely believe Charlie deserves a place in the HOF. The last time I checked, in 2012, the HOF had a time period split down the middle of our dynasty. This is 1947-1972, then 1973 to current. I would make sure Charlie was nominated under both time periods. Also, I believe my father, Carl A. Finley, deserves a place in the HOF under the Executive Category. Also, for both time periods.

SMB: Did Charlie Finley's divorce, and subsequent cash crunch, kill both the spirit and the means needed to keep the A's 70-era juggernaut alive?

NF: It seems common for most couples to experience a kind of "cash crunch" during a divorce. During this time, Charlie threw himself even more into the business. I noticed Charlie started leaning on dad more. More than the divorce, the main issues were "pending free agency," and (then MLB Commissioner) "Bowie Kuhn." I believe what killed the "spirit" the most was when we were served with a lawsuit in March 1979, on behalf of the city and county (Oakland and Alameda, respectively). Actually, the Coliseum Board was who authorized this lawsuit. The causes of action were ridiculous. This suit was thrown out of court, in our favor, a few months later the summer of 1979. Still, the fact this suit was prepared, after all we gave this area, was the final straw.

SMB: Describe your father's role in helping run the A's. Beyond just being a GM, how else was he involved?

NF: Where do I begin? When dad agreed to join Charlie and the team in Kansas City, dad was promised a minority ownership. This was a "given."  Then, it seemed like if any employee wanted to speak with Charlie, he would go to dad first. I remember Pat Friday (general manager from 1961-65), in our Kansas City days, at our home often. Dad had a way of knowing how Charlie would react, and what his answer would be. It was uncanny. Dad oversaw everything at the stadium, "on site."  Dad's title would have been vice president; however, I noticed dad referred to himself with various titles, depending on the circumstances. I call it a "situational title," depending on the situation, or, circumstances. Dad could put whatever title he chose in our annual yearbook.

Dad moved to Oakland the Fall of 1967 to prepare for the 1968 season opener. Player, Rick Monday came with dad. Both attended Bay Area events to help promote the new team. In Oakland, I remember how Charlie called dad every morning between 4:00 a.m. and 5:00 a.m. We were PST, Charlie CST. 

When dad saw talent in someone, he would "sell" Charlie on that person. Dad did this for Debbie Syvyer, aka Mrs. Fields, and Stanley Burrell, aka MC Hammer. So when Charlie visited Oakland, dad would make sure to introduce them. Dad focused on running the team, so Charlie could continue running his medical insurance company in Chicago. In Oakland, during home games, it was dad who signed off every day by 5:00 p.m. on our roster. In 1975, dad started attending the annual MLB owners meetings alone. Charlie turned over his proxy to dad. From 1975 onward, I noticed dad starting to settle on the title of vice president. It was about time.

SMB: Did Charlie Finley give Oakland a fair tryout before he started angling to move the club to cities such as Denver?

NF: Oh yes, I believe we gave Oakland a fair try. Also, our fans always came first. Our search for a place to move stemmed from frustration with the Coliseum Board. The front offices needed finishing. It was drywall and cement everywhere. In Kansas City, we were told the Coliseum was ready to move into. Then, we found out otherwise. It would be like moving into a house, without any flooring, or painted textured walls. It may sound minor; however, this is not what we were led to believe. The Coliseum Board is who we dealt with. Dad didn't deal directly with any politicians. At that time, it was the Coliseum board. We were promised the inside front office would be finished. We waited, and waited. When we started winning, we thought this would get the Coliseum Board's attention. Still nothing. Dad loved the Bay Area, and didn't want to move. I do remember when meetings were held with Marvin Davis in Denver. I suspected this was also to put a fire under the Coliseum Board, to make them finish our front office, as they had promised to do.

SMB: Did you ever get to see the NHL California Golden Seals play? Was your father involved with this Oakland-based franchise as well?

NF: Yes, I attended many Oakland Seals games. How nice you remember our Seals. Not many do. For some reason, no one seemed interested in hockey at the time. Now, look at the Sharks. I asked dad why Charlie purchased a hockey team. Dad said Charlie thought we had the "golden touch" with any sports franchise, because the A's were starting to win. Charlie acted like dad felt the same way, and that dad would do the same with the other teams. Dad said Charlie should not have assumed this. Dad reminded Charlie their goal was to focus on the baseball team. Dad walked away because of this. This was about 1969. Dad was back with Charlie by the time I moved to Oakland permanently, in June 1970. Charlie didn't have the time to devote to the hockey or basketball (Memphis Tams) teams. He didn't have the time for the A's either, which is what dad did. This is why the other franchises floundered.

SMB: What would Charlie Finley think of today's stadium mess? Would he be pushing to move the team to San Jose or out of California entirely?

NF: Today, Charlie would be so pleased with the fan support. In the 1970's, we were also the "new kid on the block," which may have hampered things. However, Charlie (and dad) would have enjoyed the great fan support. Also, the A's seem to have been granted many more "perks" than we ever had. This seems to have to do with when the Raiders returned to Oakland. Because the Raiders were given so much, the A's were entitled to some of the same. The press is much more understanding today. This is what I see. I have read some (team-issued) statements, knowing that if we (Finley-era ownership) ever said the same, it wouldn't have been pretty. Charlie wouldn't have had an outside ad agency, or, a front office so large. I wouldn't see Charlie wanting to leave this location, because the fans are so dedicated. It was always about the fans. If it turned out there was a defect (construction, not up to earthquake standards, etc) in the Coliseum, we probably would choose a location similar to where the Giants did -- on the water.

SMB: My understand is that you have a book in the works. Can you tell us some details and when it is slated to hit the shelves?

NF: I have much more to add to my website. I am waiting until my book is closer to the end. Thank you for the compliment.

 SMB: Your website has a treasure-trove of vintage A's clippings and images. Does it pain you that the team's history is somewhat invisible at their current facility?

NF: Yes, it does pain me.

Thursday, April 17, 2014

Are the A's Really Interested in a "Long-Term" Lease in Oakland?

The A's and the 10-year Coliseum lease extension talks are an interesting PR/community relations tactic by the team. In theory, signing a long-term lease to stay in Oakland should be great news for those that hope to keep the club in town, and zooming out, those who hope to keep the franchise in the Bay Area. However, the lease talks are really meant to serve as an ultimatum and are a very clever game of "chicken" with the city and Alameda County.

Oakland and Alameda County know that the likelihood that both the A's and the Raiders will stay in town and have new stadiums built -- without public assistance -- is slim. As recently pointed out, the Raiders, unlike the A's, actually have expressed potential interest in building in Oakland. The site they are eyeing, however, just so happens to be where the Coliseum is located.

San Jose Mercury News columnist Mark Purdy recently detailed the Catch-22:

If Oakland agrees to do what the Raiders want and the Coliseum comes down, then the A's would obviously have no place to play. On the flip side, if Oakland agrees to an extended lease with the A's, that would clearly make it impossible to satisfy the football franchise's desires. 

The pro-Oakland line of thinking at this point says that if the A's were forced to vacate the Coliseum, they could temporarily relocate while a new park is built by the waterfront. Setting aside the feasibility temporary accommodations, the Brooklyn Basin proposal is nothing more than a series of beautiful sketches. There is no financing in place to build the park and no will from the current ownership to make the project happen. There is zero chance that the A's are going to privately finance a ballpark to serve as the crown jewel, and a major revenue generator, for an outside group. One can look at what the Giants and Cardinals are doing to see why ancillary development is critical. (Worth noting is that in San Jose Wolff has office and hotel holdings.)

Could the A's owners sell? Possibly, but the league would require an extremely well-capitalized ownership group. Such an group will only materialize when a definitive new stadium path emerges. Only the craziest of crazies could see a long-term future for the A's at the Coliseum. Sure, it has its quirks and a rich history, but the sightlines are often terrible (Mount Davis), the amenities are few and the old-time (Wrigley/Fenway) charm lacking. It is one thing to agitate and commission some CAD drawings, it is quite another to secure upwards of $500 million in financing.

The White Knight Isn't Coming

Let's also be realistic about Warriors owner Joe Lacob. He's not going to buy the A's unless: A) Brooklyn Basin is actually feasible; and b) he is cut in to the project. Signature Development of Oakland, connected both to Doug Boxer's Let's Go Oakland group and the nascent Oakland Waterfront Ballpark LLC (housed in the same building, on the same floor and operating out of the same suite in Oakland) is the real driver of Brooklyn Basin and Lacob, like Wolff/Fisher, isn't going to buy a team without a longterm profitability path. The real question, unanswered and unposed to date by the media, is does the Chinese investor group behind the Brooklyn Basin project, Zarsion Holdings Group Co., have any interest/desire to build a ballpark or buy the team?

Notable in all of this is the role of Doug Boxer. Boxer is helping Lacob's Warriors-to-San Francisco relocation efforts, while spearheading the, occasionally active, stay-in-Oakland group Let's Go Oakland. Could one of Mercury News columnist's Tim Kawakami's "sources" regarding Lacob's interest in the team be Boxer? While it was an interesting story, there is simply no substance to the rumors. Kawakami's quotes from Lacob, for an article posted earlier this month had no context and were drawn from an email exchange last December.

One Last Shot

Matier and Ross' article detailing the A's interest in a long-term lease extension noted a key caveat: the lease will need to contain an escape clause should the Raiders Coliseum-based stadium materialize, leaving the A's homeless.

Wolff noted,"There's a clause (in the proposed lease) that if the Raiders build a new facility, with some notice we will evacuate."

The article also made clear that the Raiders are the priority. Here's Coliseum Authority board member Chris Dobbins, "We want to lock the Raiders in before we make a long-term deal with the A's."

Where might Wolff want to move to in Oakland if we assume the waterfront is out? He told Oakland Tribune reporter Matthew Artz in December, "[The ideal site] would be where we're at right now. On land controlled by (the city and county)." So, in other words, the Coliseum complex.

Sure, the "Coliseum City" concept includes new baseball and football stadiums, but -- again -- you can sketch out anything, financing is another issue. The news and then retraction of the Prince of Dubai's involvement was telling. If a real roster of investors was in place for this massive project, surely this sort of rumor would not emerge.

From Artz's Oakland Tribune article on the 11th:

Appearing on 95.7 The Game, Quan said that the developers working on Coliseum City "are partnered literally with the prince of Dubai, who is next in line to lead Dubai. And they have capital."

And, then, from Artz's follow-up piece later the same day:

Quan refused to discuss her comments Friday, but acknowledged through her spokesman, Sean Maher, that the crown prince had not partnered on the deal. 

Maher said one of the developers does have connections to high-ranking officials in Dubai, "but that the crown prince of Dubai is not involved in the Coliseum project."

Keep in mind, this was the mayor herself, not a "source" or a spokesperson. Such a gaffe necessarily lends doubt to the project's viability.

What Wolff and Fisher really want is one last chance to force relocation to either San Jose or somewhere else. If keeping the Raiders forces the A's out -- either now or years down the line -- Wolff can claim that he has nowhere to go and push once more for San Jose.

Wolff's quote may read like this, "We have literally nowhere to go in Oakland. We tried to stay in the city and, ultimately, keeping the Raiders was their choice."

Monday, December 9, 2013

The A's Were Given Permission to Move to San Jose...and Didn't Do It

In the ongoing saga of the A's quest for a new stadium, the general public has been left with precious few actual facts. Therefore, the revelation that MLB had formally denied the A's request to move to San Jose on June 16 was a significant development. If the key to the Watergate Scandal, as depicted in All the President's Men, was to "Follow the money," than the corollary here is "Follow the timeline."

This blog's previous post (admittedly from a shamefully long time ago) explored this issue. Now that we know there was definitive action on June 16th, let's add some perspective to the issues and do some speculation. (After all, that is all really anyone outside of Bud Selig's inner-circle really has.)

June 16, 2013
A's denied request to relocate to San Jose.
Veracity: FACT

June 16, 2013
Sewer backup occurs at Coliseum. Later blamed on a sweater that had been flushed down the toilet.
Veracity: FACT

June 18, 2013
USA Today's Bob Nightengale reports that MLB had previous given the A's a set of conditions that needed to be met for a move to San Jose. From the article:

Baseball's blue-ribbon task force, formed four years ago, earlier this year presented Wolff with guidelines that could possibly make it work.

Veracity: UNVERIFIED
*Apologies that I erroneously tweeted last night that Nightengale reported this information the day of MLB's denial as opposed to two days later. 

June 18, 2013
San Jose sues MLB over its antitrust exemption, claiming the league is impeding the A's move to the city.
Veracity: FACT

Let's now assume that Nightengale has an inside source and that he has been giving out accurate information. Such a leap of faith makes his tweet from 2011 very interesting:

All signs and top #MLB sources say that the #Athletics will be granted permission by Feb to move to San Jose.

However, nothing came of this news, at least publicly. Enter Bill Madden of the New York Post, who on March 3, 2012 reports that the A's will be denied by MLB.

This was followed by the dueling territorial rights press releases from the Giants and the A's on Mark 7-8 of that year.

A year later, San Jose starts to break its lockstep messaging discipline with Wolff and the A's. City councilman Sam Liccardo on March 4 is quoted as saying that he wants San Jose to file an antitrust lawsuit.

To be clear, no one knows the exact connection of all these items, but the timing seems more than a coincidence. Something happened in early 2012.

MLB's formal denial letter this past June was likely precipitated by both Liccardo's threat and any number of communiques from San Jose (such as mayor Chuck Reed's public request for a meeting). Issuing it before the filing was smart business.

What May Have Happened

It seems highly likely that MLB in early 2012 presented the A's with a list of conditions for a move to San Jose, and the A's failed to satisfy them.

The A's have been explicit about saying that litigation was not the way to San Jose. However, if faced with no tenable options (e.g. crippling revenue guarantees to the Giants or an overwhelming up-front payment) a lawsuit is the last best option in the arsenal as it holds the possibility of: a) an outright win and a possible reduction of costs in the term sheet; or b) forcing MLB to settle as the discovery process would prove too damning (e.g. revealing all the league's financial secrets).

Going Nuclear

To be clear, suing MLB is not a move to be taken lightly. San Jose has crossed Commissioner Bud Selig and the league. Unless the lawsuit's appeal is successful, it would seem that the city's chances have actually diminished.

Perhaps the greatest irony of all, however, is nestled within the aforementioned court filing revealing MLB's denial letter:

Defendants (MLB) assert that this Court should take action based on a June 17, 2013 letter from Defendant Bud Selig. Defendants have failed to provide this letter to Plaintiffs (San Jose) or to this Court.

Even in litigation, MLB continues to keep the truth locked away, and force all of us to trade purely in speculation.

Saturday, June 22, 2013

Do the A's Already Know the Way to San Jose?

The news this week that the City of San Jose had lawyered-up and filed a lawsuit charging MLB of conspiring to keep the A's from moving to San Jose couldn't be called unexpected. While A's Managing Partner (minority owner/majority spokesperson) has steadfastly denied any interest in pursuing litigation, his voice is but one of many.

San Jose City Councilman Sam Liccardo who represents the area downtown where a new ballpark would be located in March hinted that a lawsuit was in the works. He was quoted then as saying:

I'm happy to swing the hammer and pound the nail....The A's ownership wants to find an amicable solution. But for the strong desire of Lew Wolff to play nice, I would be urging my colleagues to file suit right now.

For San Jose's elected officials, luring the A's south is good business sense -- especially if, as the A's ownership has stated, the ballpark's construction is privately financed. The benefits to the A's of a new stadium seem readily apparent. How its location factors in is an emotionally charged debate that is best left for another day.

San Jose previously seemed to work in lock-step with Wolff and, in turn, MLB. The one blip of near impertinence was in 2010 when San Jose Mayor Chuck Reed proposed and then quickly withdrew a ballot measure -- needed per the city's bylaws -- to determine if public funds could be used in any manner towards the construction of a baseball stadium. The proposal, made absent baseball's approval, left MLB Commissioner Bud Selig "disappointed."

Strange Baseball

Just as baseball games get pretty strange after about 13 innings or so, so too did the issue of the A's and San Jose nearly four years in.

Some notable moments:

December 24, 2011 -- USA Today baseball reporter Bob Nightengale tweets that the A's would be granted permission by February 2012 to move to San Jose.

March 3, 2012, Bill Madden of the New York Post, reports that the A's will be denied the right to move to San Jose.

March 7-8, 2012 -- Dueling press releases by the A's and the Giants are issued. The A's deny Madden's report and say that no decision has been made while defending their right to move to San Jose. The Giants, in turn, defend their territorial rights.

February 20, 2013 -- Bill Shaikin of the Los Angeles Times reports that MLB has stipulated the conditions the A's must meet if they want to move to San Jose. MLB and the A's flatly deny the story.

March 4, 2013 -- The aforementioned hint at antitrust litigation by Liccardo occurs.

March 30, 2013 -- The San Jose Mercury News reports that Reed and Wolff spoke.

April 2, 2013 -- Reed requests meeting with MLB Commissioner Bud Selig.

April 11, 2013 -- Selig declines to meet with Reed.

June 12, 2013 -- A meeting between Reed, Wolff and A's President Michael Crowley occurs.

June 16, 2013 -- Sewage backs up into the A's and Mariners clubhouses, forcing teams to shower together in Raiders locker room.

June 18, 2013 -- While reporting on sewage issue at Coliseum, Nightengale makes a passing remark that the A's have been given conditions for moving to San Jose:

Baseball's blue-ribbon task force, formed four years ago, earlier this year presented Wolff with guidelines that could possibly make it work. 

June 18, 2013 -- San Jose sues MLB for impeding A's move to the city.

More Than Meets the Eye

A possibility, however weak or strong it may be, exists that the A's really do have a list of conditions that need to be met in order to move to San Jose. These may include provisions such as an upfront cash payment or future revenue guarantees to the Giants.

Two things to consider about the mystery terms for the A's:

1. They may be onerous enough, in terms of cost, that the team's current ownership has weighed the costs and benefits and does not feel the move is fiscally prudent. The bottom line might be that the A's will simply make more money -- at least in the short-term -- by staying in Oakland and cashing revenue checks.

2. MLB may have purposely crafted the terms to be so difficult so as to incentivize ownership to keep the team in Oakland or find and sell to a group who will.

Both scenarios are lose-lose for the A's:

If #1 is at play, the "crappy" stadium means = low payroll argument is punctured. They expose themselves as being very profitable and lose leverage in the ongoing Coliseum lease extension negotiations.

If #2 is at play, Wolff and majority owner John Fisher need to either change direction and focus on Oakland or sell to a group committed to do so such as the one headed/identified by Clorox CEO Don Knauss. The problems with both these options are readily apparent: a) Goodwill towards the team's ownership in Oakland is near rock-bottom; and b) an unanswered question is how much the rights to San Jose would increase the team's valuation: ownership could be forced to sell the club below what they believe is "true value."

What is the Real Objective?

MLB's response to San Jose's lawsuit will likely be fairly predictable: they will first assert that it is without merit and then note that their "committee" is still hard at work, making comments at this time premature.

Nearly everyone is looking at this suit as a challenge to the league's antitrust exemption, but it may actually be a Trojan Horse designed to bring into the light of day the conditions the A's must meet to move. Such a revelation would be deeply embarrassing for the A's, which makes this move all the more remarkable given the city's previously cozy relationship with the team.

Somewhere someone knows something about this issue. Here's hoping that transparency wins out. 

Sunday, April 28, 2013

The Misleading, Meandering Musings of Lew Wolff

A's Managing Partner Lew Wolff's comments late last month were mainly more of the same -- mainly that the team is not viable long term staying in Oakland and needs to move into a new ballpark in San Jose.

Here is a report from Bay City News from March 21. Two passages stick out.

First:

We are assigned 2.5 million people, the other (the Giants) is assigned 4.2 million people," Wolff said. We have two counties assigned to us, there are six counties assigned to the other team.

This is a familiar line from the A's brass and a highly misleading one.

The only thing the A's are limited to, in terms of operation of the franchise, per the MLB Constitution, is building a stadium in any territory owned by the Giants. The A's are free to erect huge billboards across from AT&T Ballpark and open a merchandise shop in downtown San Jose.

If the A's and Giants were "assigned" territories for marketing purposes, how could the Giants parade the World Series trophy in Hayward, as they did this offseason, and open a merchandise shop in Walnut Creek, as they did in 2011.

All eight assigned counties, and beyond, are available to each team to market to. The A's simply cannot, at present, build a stadium in a county other than Alameda or Contra Costa.

Here is the second remarkable piece of the March report:

Wolff said the A's have turned a profit in Oakland each of his nine years as an owner by sticking to a rule of spending no more than 50 percent of revenue on player salaries, which reached $65 million last year

Unlike the first comment by Wolff, which can readily be challenged and debunked, this one requires a bit more research.

Let's examine how close the team actually comes to hitting the red zone that Wolff has designated (spending more than 50 percent of revenue on player salaries) -- the "Wolff Rule."

MLB teams are private enterprises and do not disclose financial information publicly, but each year Forbes uses every shred of information available to publish projected financial information for each club.

Here is known player salary information as compared to the projected revenue from Forbes for this season and the previous three.

Forbes Revenue for 2012: $173 Million
Opening Day Payroll for 2013: $68, 577,000
Percentage: 39.6%
Plus or Minus Wolff Rule: -10.4%

Forbes Revenue Estimate for 2011: $160 Million
(Hat Tip to New Ballpark who reported Forbes number last year.)
2012 Total Payroll: $59,493,290
Percentage: 37.2%
Plus or Minus Wolff Rule: -12.8%

Forbes Revenue Estimate for 2010: $161 Million
2011 Total Payroll: $70,476,206
Percentage: 43.8%
Plus or Minus Wolff Rule: -6.2%

Forbes Revenue Estimate for 2009: $155 Million
2010 Total Payroll: $61,733,644
Percentage: 39.8%
Plus or Minus Wolff Rule: -10.2%

The reality is that the team has not sniffed 50 percent of revenue devoted to player salaries from the 2010 season onward. The true average has been about 40 percent.

Can the Numbers Be Trusted?

One question, of course, is how accurate are Forbes' numbers? Teams routinely deny these estimates. However, thanks to Deadspin's expose in August 2010 of the several teams' financial statements we can get a better idea of how close the numbers are to reality:

Marlins Actual 2009 Revenue: $135.531 Million
Forbes Revenue Estimate for 2009: $144 Million

Marlins Actual 2008 Revenue: $139.647 Million
Forbes Revenue Estimate: $139 Million

Pirates Actual 2008 Revenue: $145.933
Forbes Revenue Estimate for 2009: $144 Million

Rays Actual 2008 Revenue: $160.961 Million
Forbes Revenue Estimate for 2008: $160 Million

It certainly would appear that the Forbes figures are, in fact, highly accurate.

Things Don't Add Up

The A's profitability, again since the team publishes no information, is largely predicated on the broad statements made by Wolff and the estimates provided by Forbes. However, in the 2011 offseason Wolff provided another breadcrumb in this blog post on the San Francisco Chronicle:

While the A's initially reported a loss in 2011, Wolff revealed they made a slight profit because the World Series extended to seven games. "We made $370,000, and that's after revenue sharing, not before," said Wolff, who confirmed last year's revenue-sharing check was $32 million. "I have to admit, without revenue sharing, we'd have a huge loss, and we don't want revenue sharing. We'd like not to be a receiver if we could.

Bearing this in mind, let's assume the revenue and net income numbers from Forbes are correct:

Forbes Revenue Estimate for 2011: $160 Million
Forbes Operating Income Estimate for 2011: $14.6 Million
2011 Total Payroll: $70,476,206

This means -- provided Wolff is being honest -- if you strip out the $32 million in revenue sharing from Forbes' figures the team should have posted a loss of around $17.4 Million. ( An aside here is that this figure is staggering given that post-2016 the A's  may lose at least some of this funding stream.)

Wolff's 2011 comment seems incongruous with what he said in March.

If the team is "consistently profitable," why would a seventh game of the World Series -- in a season where only 37.2 percent of revenue went to payroll -- be the sole reason the team was in the black?

As they say, if you believe that, then I have a bridge I'd like to sell you.

The A's real profit in 2011 was almost certainly close to the $14.6 million Forbes reported and not the paltry $370K that Wolff reported.

The Vacuum of Information

The nature of the news is such that reporters increasingly are being pushed to crank content out, and misleading statements like these two from Wolff -- somewhat understandably -- get published.

The first comment, regarding what counties the team has "assigned" to it perhaps takes a discerning mind and a real baseball devotee to suss out its accuracy. (You could argue, broadly, that this is the raison d'ĂȘtre of blogs.)

The second comment, while not a lie, is just plain misleading. Part-and-parcel to this is that MLB is more secretive than almost any organization you can fathom. This lack of transparency empowers owners to make broad statements without having anyone challenge their validity as the data points simply do not exist in the public domain.

One-on-one, Wolff should be asked by the press what percent of total revenue is dedicated to player salaries. They should dig further, ask what revenues and profitability actually are.

For any public official, of which Wolff is one, its the job of the press (and one that is greatly needed and appreciated) to demand accuracy and transparency.