Under the current collective bargaining agreement (CBA), set to expire on December 1st of 2016, all Major League Baseball teams are subject to a 34% contribution of their net local revenue. The sum of those 30 contributions is then distributed equally amongst the teams. The CBA states that teams must use those revenue sharing receipts in an effort to improve their performance on the field. It also openly states that teams are prohibited to use the receipts for anything other than baseball operations such as repayment of debts, distribution to ownership, etc.
Recently, the President of the New York Yankees, Randy Levine, spoke some his thoughts about the money they are paying in regards to the current revenue sharing plan. Levine spoke in an interview with FOX Sports, “What is very burdensome to us -- and is unfair -- is the amount of money we have to pay in revenue sharing compared, for example, to teams in our market that pay 10 times less than us” [Rosenthal]. He later went on to say that this was something that he hoped would be addressed in the new CBA at the end 2016.
I’m assuming that the current revenue sharing arrangement is something that might be opposed by the top 10 teams in terms due to loss of revenue (which includes the Yankees), but is something that would supported by bottom 10 teams for the same reason. This is a system that was put in place to try and level the playing field between teams in top markets that perennially drive revenue and teams that might not be in big media markets and struggle to gain revenue. There is some cause for concern that this could pit owners against each other in the next discussions for the collective bargaining agreement.
My opinion and my hope is that in the next collective bargaining agreement a system like this remains in place. I would be content if the proportion of the contributions that teams made were adjusted but I just think that this is a system that tries to keep competition throughout the league. The teams that may oppose this feel that it is unfair because they are giving more than other teams. However, a point that is raised by opponents of this system may say that it acts as a disincentive for teams to increase revenue and just depend on subsidy-like proceeds from the revenue sharing.
We’ll just have to see whether the revenue sharing will create tension between owners once the season is over and they begin the effort to design a new collective bargaining agreement.
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Rosenthal, Ken. "Yankees Snipe at Mets in Revenue-sharing Gripe." FOX Sports. N.p., 25 Mar. 2016. Web. 06 Apr. 2016.
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