Dodger Finances: One for the Books : Net Income Tops $6 Million; Employees Paid Like Champions

Stanford economics professor Roger Noll, in his analysis of the financial condition of major league baseball franchises, called the Dodgers “baseball’s answer to the Denver mint.”

According to Noll, the Dodgers were one of seven teams that were clearly profitable in 1984. “The basic story is that a few teams make a lot of money in any given year--usually the Dodgers plus whoever wins a pennant,” he wrote.

In the past, Dodger owner Peter O’Malley has refused to discuss the finances of what Noll calls “probably the most successful sports franchise that has ever been fielded.”

O’Malley, in an interview earlier this year, said, “As you know it’s a family-held corporation, and we’ve never really commented on the economics of it.”

But as part of the recent negotiations between the Major League Players Assn. and club owners for a new basic agreement, 24 of the 26 major league teams opened their books, providing a rare view of what had been closely guarded secrets.

It was on the basis of that information, provided by the clubs in response to a questionnaire from the New York-based accounting firm of Ernst-Whinney, that Noll prepared his analysis.

He asserted that the Dodgers’ net income was more than $6 million in 1984, a figure that he speculated may have been understated by at least $3 million.

Additional figures obtained from industry sources gave perhaps the most detailed picture of the Dodger finances ever made public.

Among them:

--The Dodgers reported a $4.6 million operating income on baseball operations (all figures are from the 1984 season), and a net income on all operations (including stadium rentals, interest income and miscellaneous income) of $6.4 million.

By comparison, the team that lost the most money in 1984, according to Noll, was the Oakland A’s, who showed book losses of $15.7 million.

--The Dodgers’ gross income from baseball operations was $42.018 million, the highest in baseball. Their expenses totaled more than $37 million.

But, as Noll writes, the Dodger profits “vastly understates the value of the Dodgers to the owners.”

The reason: The team’s general and administrative expenses were $8.360 million, which Noll said is three times higher than the major league average. Of that amount, more than $4.4 million was paid in salaries, including benefits, to front-office personnel, “about four times the average for baseball, and more than double that of the second-place team,” according to Noll.

--The Dodgers paid their players an average salary of $316,530, which placed them 14th among big-league clubs, according to figures compiled by the Major League Players Assn.

“Obviously, owners are taking out several million dollars a year from the Dodgers in the form of salaries, fringe benefits and other perquisites: The travel budget, for example, is four times the average for all of baseball,” Noll writes. “Without further breakdown of these costs--and, especially, who benefits from them--it is not possible to pinpoint exactly by how much the profits of the Dodgers are underestimated, but a conservative estimate is at least $3 million.”

--Twenty-six members of the Dodger front office, including on-field personnel such as Manager Tom Lasorda and at least some of Lasorda’s coaches--were paid in excess of $50,000 in 1984.

O’Malley’s salary was listed as $1 million. The salaries of O’Malley’s sister, Terry Seidler, and her husband, Roland, totaled more than $500,000, sources said. Terry Seidler is a member of the Dodger board of directors and listed as the team’s secretary; Roland Seidler also is on the board and is listed as vice president-treasurer.

The 1984 salary for Dodger Vice President Al Campanis was listed as more than $275,000, an increase of $45,000 from what he was paid in 1983, including bonuses. Lasorda’s salary for ’84 was listed as $335,000, the first year of the three-year contract he signed after the Dodgers won the National League Western Division title in 1983. That year, Lasorda’s salary was listed as $247,000, which included bonuses.

Lasorda’s 1984 salary thus was higher than the average of $329,408 paid major league players last year. An incomplete list of other Dodger front-office personnel who sources said were making more than $50,000 includes: marketing director, merchandising director, publicity director, director of Dodgertown, scouting director, transportation director, auditor, vice president-broadcasting director and director of stadium operations. In addition, broadcaster Vin Scully reportedly earns close to $1 million.

“The Dodgers had the highest-paid manager, the highest-paid general manager and the highest-paid broadcaster,” an industry source said.

How did the Dodgers gross more than $42 million, exclusive of league shares and visiting teams’ shares, in 1984? Industry sources provided this breakdown:

--Home-game receipts: $18.053 million, which was 98% higher than baseball’s average. The Dodger attendance in 1984 was 3,134,824, which made the average price of tickets sold approximately $5.76.

--Away-game receipts: $2.235 million, which was 85% higher than the average. That figure included exhibition-game receipts of $1.215 million, almost 411% higher than the average.

--Local radio-TV: more than $6 million, 83% higher than the average.

--Local cable TV: $2.297 million, 193% higher than the average.

--Concessions: $5 million, 84% higher than the average.

--Parking: $2.5 million, 760% higher than the average.

--Other baseball revenues (including Stadium Club dues): $300,000.

--Copyright royalty tribunal: $4.611 million.

It all helps to explain why Noll refers to the Dodgers as a “phenomenon.”

A SAMPLING OF THE DODGERS’ 1984 FINANCES

Gross income from baseball operations was $42.018 million, highest among major league teams.

Expenses were more than $37 million.

Operating income on baseball operations was $4.6 million.

Net income on all operations (which would include stadium rentals, interest income, miscellaneous income) was $6.4 million.

General and administrative expenses were $8.360 million, three times higher than the major league average. Of that amount, more than $4.4 million was paid in salaries, including benefits, to front-office personnel.

26 front-office personnel members were paid more than $50,000.

Owner Peter O’Malley’s salary was listed at $1 million.

More than $500,000 was paid to Roland and Terry Seidler, who are listed as officers and are related to O’Malley as brother-in-law and sister, respectively.

Vice President Al Campanis’ salary was more than $275,000 (a $45,000 increase from 1983, when the Dodgers won the National League West).

Manager Tom Lasorda’s salary was $335,000 (In 1983, it was $247,000, including bonuses).

Home-game receipts were $18.053 million, 98% higher than the major league average.

Away-game receipts were $2.235 million, including $1.215 million for exhibition games, 85% higher than the major league average.

More than $6 million was made from local radio and television, 83% higher than the major league average.

$2.297 million was made from local cable televsion, 193% higher than the major league average.

$5 million was made from concessions, 84% higher than the major league average.

$2.5 million was made from parking, 760% higher than average.