Why is Green Bay thriving in the National Football League while
the much larger markets of Minnesota and Montreal face elimination
from Major League Baseball in what baseball calls "contraction?"
The answer to that question goes to the heart of the tremendous
financial problems faced by professional baseball despite the
tremendous excitement of the recent World Series. It's a factor we
should all understand as Oklahoma City grows and seeks major-league
status in hockey or basketball with our new $80 million arena.
NFL clubs share all television revenue equally and split gate
revenue 60-40 with the road club getting 40 percent. The NFL also
has a salary cap for each club. That allows Green Bay, with the
smallest of all professional major-league sports markets, to compete
with clubs in New York, Chicago and all the other larger areas. The
National Basketball Association also has revenue sharing and salary
Major League Baseball clubs, meanwhile, share only national TV
revenues equally and have no salary cap. All local TV revenues go to
the local club. Gate revenue is shared only 80-20 with 20 percent
going to the road club. In minor-league baseball, there is no
revenue sharing, which means the Oklahoma Redhawks must survive only
on local revenue.
Obviously, the unequal revenue potential gives baseball clubs in
the larger markets a tremendous advantage in acquiring the revenue
to buy the best players. With the largest revenue base and no salary
cap, it is not surprising that the New York Yankees have reached the
World Series five years in a row.
All the other clubs are forced to compete with the Yankees by
bidding for players, and taxpayers are forced to help their clubs
compete by building new stadiums for hundreds of millions of
dollars. Why do the taxpayers do it?
The answer is simple. The local revenue stemming from major-
league franchises averaged $73.2 million for each market in 1999,
and the clubs with new ballparks averaged $107.2 million. The
Yankees led with $176 million. Clearly, supporting a major league
franchise is worth a major investment by the people in each
community, but the smaller markets are at a disadvantage once again
with fewer people to share the taxes.
That is the core of the dilemma faced by the people in Minnesota,
where 1.7 million fans went to Twins games this year and still face
the loss of their franchise. There is a tremendous battle under way
in Minnesota right now with political leaders, business leaders and
the public debating whether to fight baseball's "contraction" and
build a new stadium with a retractable roof or let the franchise
It's not an easy decision, despite the Twins' economic impact.
Now, I have to say right here that I have a personal interest,
because I covered the Twins as a sportswriter from 1961-79. I
battled for the building of the Metrodome Stadium as a columnist,
and I have researched the value of a major-league franchise to any
I also know that Minnesotans place a high priority on spending
tax dollars for education and culture, and a large percentage of
them object to building a new stadium for $300 million or more to
subsidize the private owners of a baseball club.
They tend to question the economic impact of a franchise, though
the Twins attract money from people in four other states. …