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Labor deal a win-win situation for Rays

A strike averted, the team will get an infusion of cash and avoids contraction for at least four years.

By MARC TOPKIN, Times Staff Writer

© St. Petersburg Times
published August 31, 2002

ST. PETERSBURG -- The Rays don't win often. But the last-minute labor agreement that prevented a strike Friday provided them with what appeared to be a doubleheader victory.

The Rays will be able to operate the next four seasons without the threat of contraction as the owners agreed to drop plans to eliminate teams until at least 2007.

And they will have more money to spend, perhaps millions as soon as next season, to improve their team as a result of the increased revenue sharing and luxury tax included in the deal.

"I think this is a good day for Tampa Bay, for our sponsors, for our fans, for the community in general," Rays managing general partner Vince Naimoli said.

For months, Naimoli and team and city officials vehemently insisted the team was not under consideration to be eliminated, that the steady flow of rumors to the contrary was the product of conspiratorial and creative minds.

But for a couple of guys who claimed they were never worried, Naimoli and St. Petersburg Mayor Rick Baker sure seemed happy on Friday to point out that the possibility of being eliminated was no longer a concern.

"Contraction is something that has irked me to no end because we have never been subject to that. It's kind of like nails across a blackboard when someone would bring that up," Naimoli said. "We had some doubters out there, but I think this agreement takes away all the doubt on that. ... We have an irritant out of the way, and that's something positive for people in our area."

"What it will do," Baker said, wearing a Rays jersey at a Tropicana Field news conference, "is end any possible rumors about the possibility for contraction and therefore give the fans in our media market more confidence that this team will be here for a long time to come."

The owners still have the right to eliminate two teams in 2007, with a promise from the players to not fight it. Naimoli and Baker are banking that it will be a moot point by then, that the team, which is headed for its fifth consecutive last-place finish, will be better by then and attendance, third worst in the majors with a nightly average of 13,272, will improve.

A key to improvement could be the additional money provided by the luxury tax and increased revenue sharing that were key parts of the agreement, which still has to be ratified next week by the owners and players.

Naimoli said the Rays won't know until reviewing the voluminous document how much more money they will get, or if they will get it in time to spend for next season. Because of complicated formulas, including a phase-in of the increased revenue sharing, they may not know the final amount for months.

Based on estimates discussed by baseball officials earlier this week, they could reap an additional $8-million -- $6-million from revenue sharing and $2-million from the luxury tax. They will also receive about $12-million more from the national television package.

That doesn't mean, however, they are likely to immediately go on a spending spree and stock up on free agents or star players.

First, they have to decide how to use the additional funds.

There is no mechanism in the agreement to force teams such as the Rays to spend the money. (The union opposed inclusion of a minimum payroll for what was said to be philosophical reasons -- that if they got a minimum in this agreement the owners could ask for a maximum next time.)

Naimoli said he wants to make the team better, but stopped short of committing to spend the additional money on major-league player payroll. He said that he might instead use some to pay down the team's revolving line of credit or invest more in player development, but that it would still help the team.

"I can't tell you how much money or when or what the application of those moneys are except to reiterate our position from day one, and that's to put a competitive team on the field," he said.

Naimoli also said the additional money will not go to him or his partners.

"From day one the investors of the Tampa Bay Devil Rays invested in the community and the team," he said. "We've never taken a dime out of the team and at this point we have no plans to take any money out of the team."

Second, they have to decide who to spend it on and when to spend it.

With a core of promising young players, the Rays will probably add to their roster, and payroll, in stages, building toward having a competitive team in 2004 or 2005.

Having tried, with horrible results, to jump start the team with several high-dollar additions in 2000, general manager Chuck LaMar said he will be more judicious in his spending. For example, he will have to decide whether it would be better to bring back pitcher Paul Wilson, who is in line for a huge raise, or seek a replacement.

But after three seasons of being more concerned with getting rid of players, even limited additions would be considered an improvement.

"This is an extremely important day for the Tampa Bay Devil Rays," LaMar said. "For the first time in three years we have a chance to have the flexibility to make player moves, and good player moves lead to more wins."

Neither the players nor the owners claimed victory when the four-year deal was agreed upon just before noon Friday, culminating an all-night negotiating session and allowing the 3:20 p.m. EST Cards-Cubs game in Chicago and 14 others to proceed as scheduled.

It was the first time since 1970 the sides reached agreement on a new labor deal without a work stoppage.

"All streaks come to an end, and this was one that was overdue to come to an end," union chief Don Fehr said.

"I think there were a lot of people," commissioner Bud Selig said, "who never believed they'd live long enough to see these two parties come together and make a very meaningful deal and do it without one game of work stoppage."

The players seemed to make the more significant concessions, agreeing to the luxury tax, which is supposed to slow spending by the high-revenue teams, and to random testing for steroids. The owners said the financial changes were necessary to improve competitive balance, closing the gap between the haves and have-nots, and to save some teams from financial ruin. It won't be known for several years how effective the changes will be.

The team hurt most by the deal will be the high-spending Yankees, who could have to hand over an additional $25-million to their competitors next season. The deal could also lead to relocation of the Expos, who were scheduled to be contracted, from Montreal to Washington, D.C.

Throughout the lengthy negotiations, both sides said they didn't want a work stoppage. The best news for fans Friday was that they meant it.

"It came down to us playing baseball or having our reputations and life ripped by the fans," said Cardinals player representative Steve Kline. "Baseball would have never been the same if we had walked out."

-Information from the Associated Press was used in this report.

The basics of baseball's new labor agreement:

LENGTH: The contract lasts through Dec. 19, 2006.

CONTRACTION: The owners agreed to not fold franchises through 2006. The players agreed to not contest contraction for the 2007 season if the owners pursue it, but no more than two teams could be eliminated. Owners must notify players of contraction plans by July 1, 2006. Owners tried to fold the Expos and Twins last offseason, and Major League Baseball took ownership of the Expos. It's unclear what it will do with the franchise, though selling the team to an owner who would move it (most likely to the Washington, D.C., area) is possible.

LUXURY TAX: Teams with high payrolls will be penalized to discourage more spending. Next season, teams would have to pay the tax on the amount of payrolls exceeding $117-million. Payrolls are for 40-man rosters and include benefits. The threshold rises each year, up to $136.5-million in 2006. Tax rates will range from 17.5 to 40 percent, depending on the season and how many times a team exceeds the threshold. The money goes into a central fund as part of revenue sharing.

REVENUE SHARING: Teams will equally share 34 percent of their locally generated money, after ballpark expenses, up from 20 percent. An additional $72.2-million will be taken from higher revenue teams and distributed to lower-revenue teams, with the lowest revenue teams receiving the greatest share. Teams will contribute equally to a $10-million discretionary fund the commissioner may use to aid teams in need. The biggest losers in the plan are the Yankees, whose $242-million revenue last year was $40-million higher than any other club. The Yankees, who paid $28-million in revenue sharing last year, expect the new deal will cost them $50-million to $55-million next year.

DRUG TESTING: Players agreed to be tested for steroids. The random testing initially will be a survey and not carry penalties. If the testing shows more than 5 percent of players are using steroids, mandatory random testing with penalties will continue the next two years. The penalty for a first positive test is placement in a treatment program. For subsequent positive tests, penalties range from a 30-day suspension to a two-year suspension. If 2.5 percent or fewer test positive in consecutive years, the testing program would switch back to a survey with no penalties.

MINIMUM SALARY: Major league players will be paid no less than $300,000 per season, up from $200,000.

AMATEUR DRAFT: The sides agreed to a worldwide draft but left some of the details to be worked out by a joint committee. Under the new agreement, if a team fails to sign a first-round pick, it will receive a corresponding pick in the first round of the following year's draft (example: if a team fails to sign the No. 2 overall pick, it would be awarded an extra pick immediately after the No. 2 pick in the next draft). Teams also will receive compensatory pics if they fail to sign their second round pick. Among the unresolved issues are whether teams should be allowed to trade draft picks, and the negotiating rights to selected players.

-- Compiled by Mike Stephenson using information from the Associated Press.

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