Baseball Tries on a New Cap Limits on How Much Players Are Paid May Level the Field for All Teams

Article excerpt

AS Ken Griffey Jr. tags a pitch for his 15th home run of the season, the crowd roars and fireworks patter under the Kingdome roof.

The star center fielder, who leads the league in homers, wields one of several sizzling bats on the Seattle Mariners. But pyrotechnics are notably absent from the club's financial scorecard: The baseball franchise says it lost about $15 million last year and expects to be $10 million in the red this season.

While many of the 28 teams in Major League Baseball are making money, other teams - estimates range from half to one-fourth - are not. Explanations range from poor management to the disparity in TV revenues between big-city teams and those in smaller cities. Owners say one factor is central: skyrocketing player salaries.

Mr. Griffey's 1994 contract of $5 million makes him the game's highest-paid center fielder. In an effort to erase red ink while making a bid for the Mariners' first division championship, Mariner vice president Woody Woodward walked a tightrope earlier this year. He retained a handful of big-name players with multimillion-dollar contracts but cut the team's payroll to $29 million, from $33 million in '93. Even so, salaries devour two-thirds of the club's revenue.

At the other end of the spectrum are a few teams like the Toronto Blue Jays, with payrolls 50 percent higher than Seattle's.

With teams bidding for top players in an effort to win pennants and fans, owners say a cap on team payrolls is needed to restore discipline and profits to the game. Basketball teams have had salary caps for about a decade, and the National Football League is operating under a new system that limits salaries to no more than 64 percent of revenues. In both sports, the lion's share of industry revenues are shared so that teams are on a fairly level playing field, economically.

This year, baseball owners are trying to renegotiate the collective-bargaining agreement that governs player contracts, hoping to introduce payroll limits. If players agree to the caps, owners will share more of their television revenue. Currently only the revenue from national telecasts is fully pooled in baseball, with local broadcast and cable coverage giving big-city teams a financial edge. The disparity is increasing this year, because national broadcast income is being cut in half under a new contract with the ABC and NBC networks.

Despite what owners argue are the game's dire straits, salary caps are hardly a foregone conclusion. Foremost among the obstacles is heavy resistance from the players union. …