Wednesday, November 25, 2009

Open Your Books, Mr. Nutting!

Open your books, Mr. Nutting!
By Bob Smizik Wednesday, 1 a.m.
http://community.post-gazette.com/blogs/bobsmizik/default.aspx

In a startling bit of reporting, the widely respected Jason Stark of ESPN.com wrote last week that many small-market MLB teams are far wealthier than anyone ever expected.

According to Stark, teams like the Pirates receive about $80 million in revenue before they sell a ticket.

That’s a figure that had not previously been reported and it's one that has to make any Pirates fan wonder where all the money is going because it’s certainly not going toward payroll.

Are the long-held suspicions that principal owner Bob Nutting is pocketing a handsome profit while foisting a third-rate team on the Pittsburgh fans true? Is Nutting the villain many fans and former fans portray him to be?

Based on Stark’s reporting, there is reason to be at least suspicious.

Stark reported that all MLB teams receive $30 million from the Central Fund, which includes revenue from national television, radio, Internet, licensing, merchandising, marketing and MLB International.

Additionally, every team but one (not believed to be the Pirates) makes at least $15 million from local radio and television revenue.

Finally, the teams that have the lowest revenue (the Pirates are in that group) receive about $35 million in revenue sharing.

That’s $30 million from the Central Fund, $15 million from local media and $35 million for revenue sharing. That comes to $80 million.

What about it, Mr. Nutting?

Nutting wasn’t talking but team president Frank Coonelly spoke to Ken Rosenthal of Fox. Rosenthal, working with a different figure, wrote: "He [Coonelly] said his club received substantially less than $40 million in revenue sharing last year, but declined to say what the specific numbers were.’’

Maybe that number was the $35 million, as reported by Stark, which is substantially less than the $40 million Coonelly was asked about. In effect, Coonelly could have been confirming Stark’s figure.

Rob Manfred, MLB’s chief of labor relations, told Rosenthal, "There is no one club getting $80 or $90 million in combination from revenue sharing and Central Baseball. Not one.’’

That’s not what Stark wrote. He said teams were getting that much money from revenue sharing, the Central Fund and local radio and TV.

Manfred was denying nothing.

So what is the real story?

No one is saying and Pirates fans, who never trusted Nutting, now have less reason to do so.

Is he financing Seven Springs with Pirates money? Is he bailing out his small-town newspaper empire with baseball profits? Or is he just putting it in his pocket?

People are suggesting as much and as long as Nutting remains quiet, he only stokes the speculation.

There’s one way to end the talk.

Open your books, Mr. Nutting.

Let the public know how much profit you’re making and where that profit is going.

Of course, you don’t have to do that. The Pirates are a private company. But they are public institution playing in a beautiful baseball stadium that was largely financed by tax dollars.

Your team relies heavily on public goodwill and through your actions you are destroying that goodwill. I have followed the Pirates as a fan for more than 60 years and as a journalist for more than 40 and I’ve never seen the team and the organization held in such a low regard.

It’s not just the losing. It’s the way you go about your business. You arouse suspicion by your actions and the actions of your subordinates.

If a public opening of the books isn’t to your liking, at least allow a government-appointed commission study your finances and report back.

If you have nothing to hide, this should not be a problem. If you do, of course, you’ll reject any attempt to let the public know how you run your business.

To use a term from another sport, the ball is in your court, Mr. Nutting.

You can surprise us all by being open and honest about your financial situation. Or you can continue to arouse suspicion and drive away customers by conducting business as usual.

Posted: Bob Smizik with 18 comment(s)
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