Rosenthal: Plan 189 could be less lucrative than anticipated

I’m not sure if this is reporting anything that we didn’t already know, but Ken Rosenthal passes along that the Yankees’ ownership group may not gain as much financial lucre from their rapid budget cutting plans as they anticipated, because adjustments by other teams could reduce the amount of revenue sharing refunds available to them:

The revenue-sharing funds that would have gone to those clubs then would be redistributed to payors such as the Yankees. The idea is to motivate certain big-market clubs — the Toronto Blue Jays, for example — to increase their revenues, knowing that they no longer would qualify for revenue-sharing money.

 From that perspective, the plan appears to be working — the Blue Jays, Washington Nationals and Atlanta Braves are among the big-market clubs that anticipate higher revenues next season, according to major league sources.

Such developments would reduce the size of the market-disqualification pot — and in turn reduce the percentage of that pot the Yankees would receive.

The Yankees anticipated $10 million from the market-disqualification program if they got below the luxury-tax threshold one time and $40 million if they stayed under it from 2014 to ’16, according to Joel Sherman of the New York Post.

These numbers are already lower than what was being floated when reports of the plan were first breaking, but that was probably a matter of confusion over the specifics due to the newness of the CBA. In any case, I’m not sure how much it really matters: the meat of the new profits will come in the form of reduced spending on payroll, with the luxury tax savings and the difference in revenue sharing funds being relatively small potatoes by way of comparison. The more pertinent detail is that they’ll stand to make more money by keeping the budget tight over the long haul, something that my cynical self assumes they intend to do until I see otherwise, frankly.

No worries though, the fact that the Yankees won’t sign anyone to a long term deal just reflects the fact that there haven’t been any useful players on the market lately:

Yankees officials, however, maintain that the team’s offseason strategy has not been influenced by future luxury-tax considerations. They say the front office simply is not enamored with the players on the market.

It’s gonna be so awesome when anonymous front office sources start planting stories in the local media about how the team isn’t wild about Clayton Kershaw and Felix Hernandez because they haven’t won any playoff games or something.

 

2 thoughts on “Rosenthal: Plan 189 could be less lucrative than anticipated

  1. jay_robertson

    Just wait until Alex becomes available in 6 years – they'll be all over him.

    IF they have any money left over from the 5 year extension they give Jeter.

    Seriously – I hope the above turns out to be in jest – someone posted a very discouraging factoid yesterday – if you add up all the scrap heap contracts the team has signed – they add up to around $15 mil – that would pay for, among others, Mr. Upton. !

    Does the team now subscribe to the theory that quantity > quality?

  2. "Yankees officials, however, maintain that the team’s offseason strategy has not been influenced by future luxury-tax considerations. They say the front office simply is not enamored with the players on the market."

    This is the biggest load of steaming, piping-hot horsesh!t I have read in forever. I'm in a pissed off mood to begin with, but reading this make me want to puke.

    IF, and I mean IF, that statement was 100% true, then either Cashman is not doing his job (this I doubt) or Brothers Hankenstein are absolutely scuttling this franchise in the name of short term margin gains. I won't turn this into a "If George were here" ranty rant, but for this team, this franchise, winning boosts margins.

    Put an inferior product in front of a crowd paying full price, and telling them it's "competitive", and you will continue to see diminished gate receipts far greater than any potential windfalls from CBA accounting games.

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