SBD/15/Leagues Governing Bodies

BASEBALL HELD HOSTAGE -- DAY 96: A CAP BY ANY OTHER NAME

     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).
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