Post by Ducky on Feb 19, 2005 12:42:01 GMT -5
continued
Baseball
Major League Baseball might have seen the future -- again -- Wednesday when the NHL shut down.
It has been 10 years since baseball last endured a lockout. But no one pretends negotiations will be pretty when the current Basic Agreement, which was finalized on Aug. 30, 2002, expires in December of 2006.
At issue will be the same hot potato that has so often been at the crux of owners vs. players negotiations: a salary cap, or in baseball's case, the likely push to increase a luxury tax on those clubs whose payrolls exceed a certain ceiling, which theoretically discourages those clubs from spending exorbitantly.
• The luxury tax agreed upon in 2002 imposed a tax on the portion of club payrolls over $117 million in 2003, $120.5 million in 2004, $128 million in 2005, and $136 million in 2006. If the 2007 season is played under an expired contract (as happened in 2002), there will be no tax in 2007. The tax rate depends on the number of times a team has gone over the cap. For the first time a team exceeds the cap, the tax was set at 17.5 percent in 2003, 22.5 percent in 2004 and 2005, and zero in 2006. For the second time a team goes over, it was to climb to 30 percent, with no tax in 2006 unless the team was also over in 2005. For the third or fourth time, it was pegged at 40 percent. There again would be no tax in 2006 unless the team were also past the line in 2005.
• Revenue sharing is likely to march in lockstep with a luxury tax when the new Basic Agreement is negotiated. It was raised to 34 percent from 22 percent in the last contract.
Along with the NHL, baseball remains the one major professional sport that does not employ a salary cap. The Players Association hasn't for a moment bought into a limitation that it views as being a camel's nose beneath the tent flap.
Instead, high-spending clubs must pay into a pool of funds that are re-distributed among smaller-market teams whose revenues do not approach those of baseball giants such as the Yankees, Red Sox, Mets, Dodgers, etc.
Baseball's owners -- at least those from mid-sized and small markets -- will no doubt push again for some kind of salary cap in 2006. A heavier luxury tax and increased revenue sharing can be viewed as mechanisms to achieve the same result and will doubtless be key issues when the current contract expires in 22 months.
Initial forecasts suggest this could see a return volley of fire by the Players Association, which is widely viewed has having ceded significant ground during the last contract showdown.
You can reach Terry Foster at (313) 222-1494 or tfoster@detnews.com, Mike O'Hara at (313) 982-3810 or (313) 222-1488, or Lynn Henning at (313) 222-2472 or lhenning@detnews.com.
Baseball
Major League Baseball might have seen the future -- again -- Wednesday when the NHL shut down.
It has been 10 years since baseball last endured a lockout. But no one pretends negotiations will be pretty when the current Basic Agreement, which was finalized on Aug. 30, 2002, expires in December of 2006.
At issue will be the same hot potato that has so often been at the crux of owners vs. players negotiations: a salary cap, or in baseball's case, the likely push to increase a luxury tax on those clubs whose payrolls exceed a certain ceiling, which theoretically discourages those clubs from spending exorbitantly.
• The luxury tax agreed upon in 2002 imposed a tax on the portion of club payrolls over $117 million in 2003, $120.5 million in 2004, $128 million in 2005, and $136 million in 2006. If the 2007 season is played under an expired contract (as happened in 2002), there will be no tax in 2007. The tax rate depends on the number of times a team has gone over the cap. For the first time a team exceeds the cap, the tax was set at 17.5 percent in 2003, 22.5 percent in 2004 and 2005, and zero in 2006. For the second time a team goes over, it was to climb to 30 percent, with no tax in 2006 unless the team was also over in 2005. For the third or fourth time, it was pegged at 40 percent. There again would be no tax in 2006 unless the team were also past the line in 2005.
• Revenue sharing is likely to march in lockstep with a luxury tax when the new Basic Agreement is negotiated. It was raised to 34 percent from 22 percent in the last contract.
Along with the NHL, baseball remains the one major professional sport that does not employ a salary cap. The Players Association hasn't for a moment bought into a limitation that it views as being a camel's nose beneath the tent flap.
Instead, high-spending clubs must pay into a pool of funds that are re-distributed among smaller-market teams whose revenues do not approach those of baseball giants such as the Yankees, Red Sox, Mets, Dodgers, etc.
Baseball's owners -- at least those from mid-sized and small markets -- will no doubt push again for some kind of salary cap in 2006. A heavier luxury tax and increased revenue sharing can be viewed as mechanisms to achieve the same result and will doubtless be key issues when the current contract expires in 22 months.
Initial forecasts suggest this could see a return volley of fire by the Players Association, which is widely viewed has having ceded significant ground during the last contract showdown.
You can reach Terry Foster at (313) 222-1494 or tfoster@detnews.com, Mike O'Hara at (313) 982-3810 or (313) 222-1488, or Lynn Henning at (313) 222-2472 or lhenning@detnews.com.