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SBD/15/Leagues Governing Bodies
BASEBALL HELD HOSTAGE -- DAY 96: A CAP BY ANY OTHER NAME
Published November 15, 1994
MLB owners, led by Red Sox CEO John Harrington, will propose a revenue or payroll tax system to the union when the talks resume in Washington on Thursday. "The shift ... marks management's first change in strategy" since their salary cap proposal of June 14. Harrington noted that "a tax concept can look like a salary cap" and is still intended to control labor costs. Harrington: "All payrolls would be taxed at a low percentage" (BOSTON HERALD, 11/15). MLB General Counsel Gene Orza: "It doesn't make me more pessimistic or optimistic. I just want to see it." Unlike the union's September 8 proposal suggesting a tax on the top 16 teams, Harrington said owners feel "some other rationale" should determine the level at which payrolls are taxed: "We're going to try to marry the best parts of a luxury tax with a general payroll tax" (AP/CHICAGO TRIBUNE, 11/15). FLICKERING HOPE: According to this morning's WASHINGTON POST, teams would be taxed "substantially" on payroll money above a predetermined level, which in turn would be used to subsidize small market teams. Sources close to the situation say "concerned" owners who called management leaders yesterday to ask why the salary cap had been removed, were "assured that the in- the-works proposal will have a mechanism for containing players' salaries." It "remains unclear" whether this offer will move the groups "substantially" closer, but any "hope" for a settlement depends on whether special mediator Bill Usery can get the two sides to "begin negotiating on the particulars" of a taxation system (Mark Maske, WASHINGTON POST, 11/15).