Selig prepares to address Congress on baseball's losses

Posted: Thursday, December 06, 2001

Baseball had an operating loss of $232 million this year, including a major league-leading $52.9 million by the Toronto Blue Jays, according to a report that will be given to Congress on Thursday.

While the Arizona Diamondbacks were a success on the field, winning the World Series in just their fourth season, they were a bottom-line bust, with an operating loss of $32.2 million, according to the report, obtained Wednesday night by The Associated Press.

That was the third-highest operating loss in baseball, trailing only Toronto and Los Angeles ($45.3 million).

Eleven of the 30 teams had operating profits before revenue sharing, led by the New York Yankees at $40.9 million. Seattle was second at $34.3 million, followed by San Francisco at $19 million and Milwaukee at $14.4 million.

Baseball's operating loss came on record revenue of $3.5 billion. The report showed an additional loss of $112 million in interest costs, which includes borrowing to fund team's payments for new ballparks. An additional $174 million is added in amortization -- essentially depreciation of a portion of teams' asset value -- resulting in an overall loss of $519 million, the report said.

Baseball commissioner Bud Selig is to present the report along with other financial breakdowns when he testifies Thursday before the House Judiciary Committee in Washington.

Legislation to eliminate baseball's 79-year-old antitrust exemption was introduced in the House and Senate following the vote by major league owners last month to eliminate two teams before next season.

While no teams were selected, the Montreal Expos and Minnesota Twins are the likely candidates, and Minnesota's congressional delegation pushed for the hearing.

Montreal had an operating loss of $38.5 million, which was cut to $10 million after revenue sharing -- money redistributed from baseball's high-revenue teams to low-revenue clubs. Minnesota had an $18.5 million operating loss, which became a $536,000 operating profit after the revenue sharing money was redistributed.

The introduction of the legislation set the stage for another trip to Capitol Hill by Selig, who has clashed with congressmen at several hearings in recent years.

The players' association is often dubious of claims of losses, and union head Donald Fehr is expected to respond to Selig at a news conference Thursday in Irving, Texas, where the players' executive board is meeting. While the figures haven't been audited, baseball's early accounting has usually been within 5 percent of the final totals.

''We can argue over the level of detail of the information,'' Sandy Alderson, baseball's executive vice president of operations, said after the AP obtained the report. ''Is it a fair representation of the economic state of the game? I think the answer to that is clearly yes.''



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