Game Became the First Priority

By ROSS NEWHAN

Aug. 31, 2002 12 AM PT

TIMES STAFF WRITER

NEW YORK — If baseball’s new collective bargaining agreement is truly “historic,” as Commissioner Bud Selig called it Friday, it won’t be because it was the first achieved without a work stoppage but because it helped address the competitive and revenue disparities that Selig has continually cited for depriving too many cities of “faith and hope.”

In announcing the agreement, achieved by negotiators for the owners and players after a series of around-the-clock bargaining sessions over a 48-hour period that took the sides into Friday’s union strike date, Selig said he was confident the contract would “significantly contribute” to the restoration of competitive balance and represented the culmination, as Paul McCartney wrote, “of a long and winding road.”

Time, of course, will determine the agreement’s impact on competitive balance, but it certainly represents a breakthrough in the often rancorous labor relations between owners and players and represents a recognition by both sides that the game would have been seriously damaged by a ninth work stoppage in 30 years.

Amid the shuttle diplomacy, as the negotiators hiked through the rain between the union and Major League Baseball offices, frequently surrounded by reporters and cameramen blocking their progress, there were the 11th-hour trade-offs typical of any meaningful bargaining process and concessions on both sides.

Selig could ultimately say that the agreement included most of the components recommended by his economic study committee two years ago.

Whether it provides the salary restraints that most owners considered an imperative complement to the restoration of competitive balance is another issue that will be determined by time.

But union counsel Gene Orza didn’t seem concerned that the combination of a payroll tax and increased revenue sharing--both burdens falling on the high-revenue clubs that drive the salary market--will impede signings.

“If the salary growth declines,” he said, “it’s generally only partly the result of a bargaining agreement. The principal cause is generally the result of a slowdown in the overall economy.

“As long as clubs aren’t acting collusively, and there isn’t the artificial restraint of a cap, we’ve accepted the ups and downs of the market for what they are.”

Here are some highlights of the long road to Friday’s agreement:

* It was only two days after a memorable World Series that Selig shattered the Game 7 glow by announcing that the owners intended to eliminate two teams, later determined to be Minnesota and Montreal.

The contraction scenario clouded the off-season and was eventually foiled by the courts and a union grievance. Now, as part of the give and take of the bargaining process, Selig has agreed not to contract until 2007.

The commitment figures to keep the Twins in Minnesota and could find the Expos moving to Washington, although the suit recently filed by the Expos’ former minority partners against Selig and former Expo owner Jeffrey Loria for mail and wire fraud could be a complication.

* The union swallowed its objection to a payroll tax that it long considered tantamount to a cap and ultimately agreed to thresholds of $117 million next year, $120.5 million in 2004, $128 million in 2005 and $136.5 million in 2006.

All payroll--based on 40-man rosters and benefit payments--above those thresholds will be taxed at rates ranging from 17.5% to 40% depending on the number of times a team goes over the threshold.

Although four teams--the New York Yankees, Texas, Dodgers and Boston--would be taxed based on the $117 million threshold and their 2002 payrolls, it’s ultimately aimed at reining in the Yankees, whose 2002 payroll for tax purposes is $171 million.

The union didn’t want a tax in the fourth and final year of the contract but accepted it in trade-off for the agreement’s usual expiration date moving from Oct. 31 to Dec. 19. This protects the postseason free-agent class of 2006 from a lockout in event of a labor dispute and was the last serious hurdle in the negotiations.

* About $169 million is being transferred from the high-revenue clubs to the lower-revenue clubs this season. That amount will increase to $258 million when fully implemented in the third and fourth years of the new agreement.

Clubs will share 34% of their local revenue after ballpark expenses, and the revenue-sharing pool will be increased by an annual $72.2-million contribution from the central fund, a depository for national TV and licensing income. The owners agreed to a phase-in of that amount, a concept that almost disrupted the entire negotiations when first proposed by the union, in return for the union, which had initially proposed sharing $235 million, agreeing to the $258 million figure and a higher annual phase-in.

The Yankees, under their new tax and revenue-sharing responsibilities, will have to pay between $50 million and $55 million next year, about double their current burden. Club officials refused to say whether they are still considering a suit against baseball.

* In addition to the previously announced agreements on minimum salary and steroid testing, the sides have agreed to the concept of a worldwide draft of amateur players and will continue to discuss the format, including the number of rounds. The union has proposed 20 and the owners 38, according to Orza, who said it hasn’t been determined whether the draft will be implemented next June or in 2004.

Among the members of management’s negotiating committee was Baltimore owner Peter Angelos, who was asked if he thought the agreement would help restore competitive balance, an issue that makes union officials bristle because they consider competitiveness more a test of good management than lack of revenue.

“Baseball is a contest. It’s a game,” Angelos said. “If there isn’t competition, the people you’re trying to reach lose interest. I think this is a good step in the direction [of restoring balance].”

Considering the next step wasn’t on a picket line, it probably should be considered a very good step.

(BEGIN TEXT OF INFOBOX)

*--* WINNERS

*--*

Dodger, Angel fans--Their teams get to finish the season with playoff berths on the line.

Bud Selig--It’s not a complete overhaul of the system, but it’s a start: The commissioner got the owners the luxury tax and revenue sharing they wanted.

Rookies--Minimum salary increases to $300,000 next season.

Mid-level free agents--If payroll tax and revenue sharing work, the money teams don’t spend on superstars should trickle down to them.

Fox Sports Net viewers--They won’t be stuck with reruns of “Best Damn Sports Show Period” in place of canceled games.

*--* LOSERS

*--*

Met, Tiger fans--Their teams have to finish the season with nothing on the line.

New York Yankees--George Steinbrenner’s team will be the hardest hit by the luxury tax and revenue sharing--an estimated $22 million to $27 million more next season.

Henry Aaron--All-out assault on his home run record continues unabated with wimpy steroid testing plan.

Carl Pohlad--With no contraction through 2006, he’ll have to sell the Twins (if he can find a buyer) instead of getting $150 million from Major League Baseball to walk away.

WNBA--With full schedule of baseball being played, opportunity to grab a bigger share of weekend sports spotlight disappears.