Strike Date Could Be Coming

After months of doomsday speculation, public relations campaigns and sniping from both sides, the most significant strike call of the Major League Baseball season looms as the union meets Monday in Chicago.

Frustrated by lagging negotiations on a new bargaining agreement and concerned about the unilateral implementation of new work rules after the World Series, the Major League Baseball Players Assn. has chosen the All-Star break as a time to turn up the heat on team owners.

The union thinks that setting a date for a work stoppage, most likely in September, might spur more serious bargaining sessions because the players would be poised to deliver a significant economic blow to an industry that last year generated a record $3.55 billion in revenue.

Sources from both sides say some progress has been made on three core issues: increased revenue sharing among the clubs; a luxury tax on teams with high payrolls; and the format of a worldwide draft. Still, there is little to indicate that an agreement is imminent. This season has been played even though a five-year pact expired after the last World Series.

There has been no movement on a fourth issue--testing for illegal substances, including steroids. The union opposes random drug testing on privacy grounds.

Also clouding the process is the union’s grievance on contraction--the owners’ ability to eliminate teams without union approval. Arbitrator Shyam Das is expected to rule on the matter in the next month or two, and either side could be awarded a major bargaining chip for negotiations.

Baseball has had eight work stoppages since 1972, the last spanning 232 days and costing owners an estimated $900 million in revenue, players about $350 million in salaries, and resulting in the cancellation of the 1994 World Series and a shortened ’95 season.

Bud Selig, baseball’s commissioner, has vowed not to lock out players through the end of postseason play, so a strike is risky for the union in the court of public opinion. Players are wary of being perceived as greedy and taking the blame for shutting down the game.

Owners seem equally uneasy. The union historically has pounded them in labor disputes, capitalizing when owners have split into factions and lost their resolve to back their own negotiators.

Determined to maintain a united front this time, Selig recently lifted a gag order--and the threat of a $1 million fine--he had imposed on owners and other team executives. He now wants ownership’s message out, and recently outlined the new policy in a league-wide memo, with instructions to owners about sticking to a script.

Dodger Chairman Bob Daly, who became familiar with labor negotiations when he was studio boss at Warner Bros., stuck close to that party line when he said an agreement must be reached because of what’s at stake.

“Baseball has financial problems that have to be adjusted, but we should be able to work something out with the union to make [an agreement] happen,” he said. “The thought that we would maybe be sitting here this September and have no baseball, after what we all went through last September and what baseball did to help the country heal a little bit, and the way we were praised for doing it, I just think it’s so shortsighted on everyone’s part.

“The fans deserve a playoff and World Series. To lose it again would be terrible. Both parties have to be responsible enough to sit in a room and act like adults and make a deal. [Owners are] clearly behind Bud as far as the idea that we believe that adjustments have to be made and parity is our No. 1 issue. His job is to get us to a better financial situation.”

Negotiators, who took a break in conjunction with the three-day All-Star break, are scheduled to return to the table Thursday amid much uncertainty and rancor that figures to increase. A long interruption in play would cost owners--who face $1.7 billion in debt on new stadiums and claim operating losses of $500 million last year--hundreds of millions in lost revenue, players millions in lost salaries and affect everyone from stadium workers to companies that support the game’s expansive daily operation.

All of baseball risks ending a renaissance. Although attendance is down 5%, it is expected to top a healthy 70 million this season. It took a while, but buoyed by Cal Ripken’s record for consecutive games played, the 1998 home run chase between Mark McGwire and Sammy Sosa, and Barry Bonds’ record-setting homer barrage of last season, fans have returned to the game in droves even though many swore off their allegiance after the last strike.

That’s why neither side wants to be blamed for another work stoppage and why both sides have been courting major media outlets with their spin on the story. Selig and his top negotiators met with editors and reporters from some of the nation’s largest newspapers, including The Times. Union chief Don Fehr responded with his own tour, making himself available to reporters.

“There is always a danger of alienating fans in a situation like this,” Angel player rep Scott Schoeneweis said. “But the fans don’t have the information we have a lot of the times. There are things that may force us to do this.”

Rob Manfred, baseball’s vice president of labor relations, said owners are “disappointed” by speculation the union might set a strike date Monday.

“We’ve made many proposals, and received no response before a meeting as important as the one that they have scheduled on Monday,” he said. “We really made an effort over the last two weeks to move the negotiations. We were the ones who brought the core economic issues back to the table by making the proposals.

“In addition, we did some of the little things that are often significant in terms of moving a negotiation. There is no justification or excuse for the union setting a strike date at this point and time. None.”

Fehr declined comment on the agenda for the meeting, which player representatives from the clubs are expected to attend. However, union sources confirm that during an ongoing tour of clubs Fehr told players the issue of a strike date, and a possible vote, would top the day’s to-do list.

Paul Lo Duca, the Dodgers’ player rep, will not attend the meeting because he’s been told Fehr is coming to Los Angeles to meet with the entire team soon after the All-Star break.

Lo Duca has heard several rumors about a strike date--possibly in August, perhaps at the end of the regular season, and maybe none at all. “We’ll know after the meeting,” he said Friday.

If the union sets a September date, players would receive almost a full year of salary and owners almost a full year of attendance, though the owners would stand to lose a significant amount of postseason television revenue. An August date would cost players more in salaries, and also hit owners hard because it could wipe out almost two months of attendance and potentially big crowds for teams in playoff contention. Another option would be for players to walk out just before the playoffs, but they might be reluctant to go that route because of the inevitable fallout from the public.

Fehr was eager to discuss his view of the negotiations, saying management is up to old tricks.

“I’m a little tired of hearing that,” Fehr said in response to Manfred’s statement that the owners appear more interested in a deal than the players. “What they do is they come up with a couple of things and then announce that they’re waiting to hear a response. They know it’s not that simple.

“They know we’ve been waiting for meaningful responses from them, in many cases, for months and months. We went, for example, from the end of June until December before they responded to a proposal that we made. They waited six to seven weeks to respond to a proposal that we made on economics. So when you hear something like that, it’s entirely propaganda and it ought to be treated as such.”

Revenue sharing has ignited the most heated debate. The sides disagree on the percentage of revenue that should be shared and the method of distribution. Owners are determined to increase revenue sharing because they believe disparity in local revenue is responsible for the competitive cap between big- and small-market teams. The union contends that poor management is a bigger factor than owners concede.

The basic concept of revenue sharing is that the entire sport benefits if high-revenue clubs share their profits to enable low-end teams to spend more money on players, increasing competitive balance. Postseason performance is the foundation of the argument for more revenue sharing.

Only five clubs from the two lowest payroll groups participated in the playoffs from 1995-2001, and all lost in the first round. And of the 224 postseason games played during that seven-year span, teams from the top two payroll groups went 219-5. The 1998 San Diego Padres were the only club from a lower payroll group to reach a World Series.

Selig has persuaded owners to publicly support increased revenue sharing, but some big-market owners are concerned that the money that goes to some teams winds up in the pockets of owners--or is ticketed to pay debt--rather than being spent on players. Almost $166 million was shared among the teams in 2001, and about $187 million is projected this season.

Presently, every club contributes 20% of its net local revenue, and 75% of the total figure is equally distributed among the 30 teams. Only clubs below the revenue average receive the remaining 25%, with the teams the most below average getting the biggest shares. The system protects the wealthiest clubs, which retain 80% of their revenue, and benefits lower-revenue clubs at the expense of the middle-of-the-pack teams.

In the owners’ new straight-pool proposal, the amount of shared revenue would increase significantly. Every team would contribute half its revenue, after ballpark expenses, and receive an equal share of the total pool. Based on their industry-high local revenue of $217.8 million last season, the Yankees would have contributed $108.9 million to the pot. The Montreal Expos, who were last at $9.8 million, would have put in $4.9 million and received the same payout as the Yankees.

The union has proposed increasing revenue sharing from 20% to 22.5% and distributing it in a split-pool plan. The union plan would produce less revenue sharing and the wealthiest clubs would not lose as much of their local revenue as under a straight pool. The union favors a split pool because the teams in the top tier pay less and the clubs in the middle--the ones that drive players’ salaries--receive more. The union believes that the more those clubs have to share revenue, the less they might spend on salaries.

Owners are also seeking to provide Selig with a discretionary pool of $85 million, which could be used to help struggling organizations remain afloat, although Selig recently said he would no longer bail out teams. How the pool would be funded is another source of contention.

The discussion about a luxury tax on payrolls has changed recently. Owners had sought to establish a 50% tax on all payroll over $98 million, but now appear willing to gradually reach that percentage over several seasons.

“We proposed a transition rule that would moderate the effect of the [luxury tax] during the first couple of years for clubs that had very high preexisting commitments,” Manfred said. “For clubs like the Dodgers, which have a high payroll they can’t get out of, it would moderate the effect of [the tax].”

Owners would prefer to implement a “hard” salary cap such as the NFL system, which prohibits teams from exceeding a certain payroll figure, but the baseball union--the most powerful in sports--would never accept that. The NBA has a salary cap and luxury tax, but the NHL has no such restrictions on payroll.

Baseball owners consider a luxury tax to be essential for restraint on payroll growth. They are confident it would serve as a moderate form of a salary cap, and are worried that increased revenue sharing without a luxury tax would not slow skyrocketing salaries.

Economics are a big part of the worldwide draft issue as well. The union wants a draft to occur in two phases, international and American, creating two sets of first-round draft picks and more big bonuses. It also wants to reduce both drafts to only eight rounds from the current 50-round format, creating more free agents.

Owners and players are far apart on drug testing, with recent controversy about steroid use only increasing the chasm. Unlike the Olympics, NBA and NFL, baseball does not have a testing program for steroids. The issue has been a source of friction in talks, especially since retired league MVPs Ken Caminiti and Jose Canseco recently alleged that the use of performance-enhancing substances is rampant in baseball. Owners are not willing to capitulate on drug testing to complete a deal, a management source said.

*

Staff writers Ross Newhan and Mike DiGiovanna contributed to this report.