Financial documents obtained by The Associated Press show that the Pittsburgh Pirates made nearly $29.4 million in 2007 and 2008, a number that likely won’t sit well with fans of a team that hasn’t seen the sunny side of .500 since the 1992 season.
The AP report also indicated that the Pirates received about $70 million from MLB sources, including revenue sharing, TV contracts, merchandise sales and MLB’s website.
The Pittsburgh Post-Gazette reports that the Pirates, a limited partnership with a number of private investors, weren’t pleased with what they called “a leak’ of those documents at a Sunday meeting with four media groups. "It's not information that's appropriate to be shared for a private business, and it wasn't appropriate to be leaked," Pirates owner Bob Nutting was reported saying in the Post-Gazette.
At that meeting, the Post-Gazette reports that Nutting and team president Frank Coonelly opened their financial books to explain some of the numbers in the AP report, and they also revealed the team had a profit of $5.4 million in 2009.
MLB.com, which was also present at the Sunday meeting, reports that Nutting specifically addressed a $20.4 million payment that the AP reported was distributed to the team’s partners in 2008. Both MLB.com and the Post-Gazette reported that $10,839,000 of that sum went to cover income taxes for the partners, and $9,604,000 was to cover the interest on a loan made by Nutting to the Pirates in 2003. From MLB.com: “I wanted to make sure that we opened up a dialogue before that blows up, because I don’t have a clear sense of what the storylines may be,” Nutting said. “But I am sure that any number of numbers can be pulled out of context and blown up and greatly
The AP report also indicated that the Pirates received about $70 million from MLB sources, including revenue sharing, TV contracts, merchandise sales and MLB’s website.
The Pittsburgh Post-Gazette reports that the Pirates, a limited partnership with a number of private investors, weren’t pleased with what they called “a leak’ of those documents at a Sunday meeting with four media groups. "It's not information that's appropriate to be shared for a private business, and it wasn't appropriate to be leaked," Pirates owner Bob Nutting was reported saying in the Post-Gazette.
At that meeting, the Post-Gazette reports that Nutting and team president Frank Coonelly opened their financial books to explain some of the numbers in the AP report, and they also revealed the team had a profit of $5.4 million in 2009.
MLB.com, which was also present at the Sunday meeting, reports that Nutting specifically addressed a $20.4 million payment that the AP reported was distributed to the team’s partners in 2008. Both MLB.com and the Post-Gazette reported that $10,839,000 of that sum went to cover income taxes for the partners, and $9,604,000 was to cover the interest on a loan made by Nutting to the Pirates in 2003. From MLB.com: “I wanted to make sure that we opened up a dialogue before that blows up, because I don’t have a clear sense of what the storylines may be,” Nutting said. “But I am sure that any number of numbers can be pulled out of context and blown up and greatly
misrepresent the financial picture of the club. I think that would be a disservice to the club.”
Sporting News writer Stan McNeal spoke with a player agent on Monday about the release of the Pirates’ information, as well as the financial documents for the Rays, Marlins, Mariner and Angels posted on Deadspin.com. "This is precisely the type of financial documents that MLB has been trying to keep secret for years,” the agent told Sporting News. “Being private companies, they have never been under an obligation to disclose this information. Obviously, you can see why. No team with 18 losing seasons in a row wants its fans seeing that it is extremely profitable, not to mention the increases in equity every year."
The AP, which was not invited to the Sunday meeting, talked with David Berri, the president of the North American Association of Sports Economists who has also authored two books that look at the correlation between finances and winning: "The numbers indicate why people are suspecting they're taking money from baseball and keeping it—they don't spend it on the players. Teams have a choice. They can seek to maximize winning, what the Yankees do, or you can be the Pirates and make as much money as you can in your market. The Pirates aren't trying to win."
The Pirates, of course, disagree with that statement. They point to the money they’ve spent recently in baseball’s amateur draft and in their international scouting operations.
"I hear all that," Nutting told the Post-Gazette on Sunday. "I really believe we are doing the right things for the club. I know we're acting honorably. I know we're acting in the best interests of the Pittsburgh Baseball Club. And I know we're making good decisions that are going to help us create a winning organization. I really believe that what we're going through is worth it. Because if I didn't, there would be no reason to put up with the agony, whether that's the on-field performance this year, or the public lashing. We're going to stay the course."
Will these financial numbers change the way players and their agents deal with ballclubs?
The AP, which was not invited to the Sunday meeting, talked with David Berri, the president of the North American Association of Sports Economists who has also authored two books that look at the correlation between finances and winning: "The numbers indicate why people are suspecting they're taking money from baseball and keeping it—they don't spend it on the players. Teams have a choice. They can seek to maximize winning, what the Yankees do, or you can be the Pirates and make as much money as you can in your market. The Pirates aren't trying to win."
The Pirates, of course, disagree with that statement. They point to the money they’ve spent recently in baseball’s amateur draft and in their international scouting operations.
"I hear all that," Nutting told the Post-Gazette on Sunday. "I really believe we are doing the right things for the club. I know we're acting honorably. I know we're acting in the best interests of the Pittsburgh Baseball Club. And I know we're making good decisions that are going to help us create a winning organization. I really believe that what we're going through is worth it. Because if I didn't, there would be no reason to put up with the agony, whether that's the on-field performance this year, or the public lashing. We're going to stay the course."
Will these financial numbers change the way players and their agents deal with ballclubs?
“It won’t have a ton of impact for agents,” the agent told Sporting News. “We have always known that teams were profitable. It could have a small impact on the Pirates because there is specific information out there now on their operations, but more than likely, it will have little effect. The bigger impact will be on the Pittsburgh organization and its fan/client base. It could also have a spillover effect on other small market, unsuccessful clubs. But again, this simply confirms what everyone in the industry already knew—MLB clubs make money. When you couple this with the true “name of the game” for MLB teams—equity appreciation—it paints a fairly rosy financial picture for them.”
