In their effort to gain the salary cap they say they need to restore “economic sanity” to their game, major-league baseball club owners Tuesday offered to give the players 50 percent of their revenue and conditionally guarantee them $1 billion a year.
In the long-awaited proposal, the owners also called for a payroll floor as well as a ceiling and said they would give the clubs four years as a transition period to come into compliance with the cap.
“This represents a very, very important event in the history of baseball,” Richard Ravitch, the owners’ chief labor executive, said at the news conference where he discussed details of the proposal.
But the Players Association, which has always opposed a salary cap, wasted no time criticizing the proposal.
“They eliminate salary arbitration, add a cap and pose all kinds of limitations on free agency,” said Donald Fehr, the union chief. “Put those three things together and you’ve cut the heart out of the player compensation system.”
In other words, contrary to the optimism emanating from the owners at their meeting in Cincinnati last week after they authorized the proposal, baseball’s labor picture looks no less bleak than before.
The union’s executive board will meet Thursday in Chicago to discuss the proposal, formulate its own plan and possibly set a strike date, though the player representatives could wait until a July 11 meeting to take that action.
Ravitch had lobbied among the owners for a proposal he thought would be fair enough to grab the players’ attention as an initial offer. The 50 percent share of gross revenue, for example, far exceeded the 38 percent the clubs offered during the 1990 negotiations.
But as reasonable as the owners hoped the players would find a 50-50 split, it would be a reduction from the estimated 58 percent the players will receive this year from the clubs’ projected $1.8 billion revenue.
However, the proposal offers to give the players in future years no less than the money they will receive this year-approximately $1 billion-as long as gross revenues do not fall.
Unlike the National Football League and the National Hockey League, baseball players would share 100 percent of the owners’ revenue. But they were told that future expansion fees would not be included because they are not a recurring revenue source.
They also learned that their own licensing money, which exceeds $50 million a year, would be included in gross revenue. In other words, they would be giving up 50 percent of the money they have divided among themselves and also used as their strike fund.
