Marlins CEO Derek Jeter Attends First Owners' Meeting; Talks Plans To Cut Team's Payroll
Marlins CEO Derek Jeter yesterday at the MLB owners’ meeting said that the team "has been 'losing money for quite some time,' which necessitates change for the new bosses," according to Tim Healey of the South Florida SUN-SENTINEL. Jeter said, "There are some financial things we have to get in order. That’s the bottom line." He admitted it is unclear exactly how the Marlins "will make more money." One eventual source of additional revenue is "selling the naming rights to Marlins Park," which Jeter said he intends to do. Healey notes the Marlins’ TV deal with FS Florida, which at $20M per year is "well below even what other small-market teams get for the rights to broadcast their games, will expire" in three years. That will be "another opportunity for improvement" (South Florida SUN-SENTINEL, 11/16). In Miami, Keith Larsen in a cover story notes sports business execs believe Jeter and Marlins Chair & Principal Owner Bruce Sherman "can increase the Marlins' revenue in a few ways, including renegotiating" its deal with FS Florida, signing a naming-rights partner and "capitalizing" on MLB's revenue-sharing agreement. All revenue from a naming-rights deal for Marlins Park "would go to the team" as part of the organization's agreement with Miami-Dade County (SOUTH FLORIDA BUSINESS JOURNAL, 11/10 issue). In N.Y., James Wagner notes since taking over the Marlins, Jeter said that he has "spent most of his time working on the business side than the baseball aspects" (N.Y. TIMES, 11/16).
SLASHING THE BUDGET: Jeter said the financial state of the unprofitable franchise is unsustainable and vowed changes will be made. Jeter said, “We need to make adjustments. We can’t continue to run the organization how it’s been run. So we have to change that." Jeter did not commit to trading RF Giancarlo Stanton, who is still owed $295M on his contract and has been an early fixture in offseason trade chatter around the industry. Jeter: "It’s easy to point the finger at him because he makes the most money. But it doesn’t necessarily mean that’s a move that’s going to be made." Jeter said of speaking to Stanton, “When the time is right, we’ll speak” (Eric Fisher, Staff Writer). In Miami, Jackson & Spencer note Jeter and Sherman "told other owners they plan to reduce payroll" from $115M to $90M in '18 and "also are planning for" a $90M payroll in '19. Only the Brewers, Rays, Padres and A's "began last season with a payroll below" $90M. Jeter said that the "current Marlins roster would cost more" than $140M next season if kept together (MIAMI HERALD, 11/16). The HERALD's Spencer writes "ridding the franchise of Stanton’s big contract would therefore appear to be an obvious first step" in reducing payroll. But since Stanton has veto power on any deals, it "will require his approval to sign off on a trade" (MIAMI HERALD, 11/16).
BORAS BLASTS MARLINS: Jeter said, "We’re going to make decisions that sometimes may be unpopular." USA TODAY's Bob Nightengale writes the problem, as the Marlins "discovered this week, is that no is willing to give them want they want for Stanton" (USA TODAY, 11/16). Nightengale also notes Stanton's agent, Scott Boras, "chastised" Jeter and Sherman, "questioning why they would purchase the team if they planned on slashing payroll." Boras said, "We basically have a system in baseball where we have sales of franchises, and we have a reduction. Basically the idea is to reduce the debt service to pay for the franchise by reducing all major league payroll, not being competitive, basically using the argument that we’re going to build a successful team through development. That has nothing to do with the fans. It has nothing to do with winning. It has nothing to do with anything other than a financial plan that suits ownership without consideration of the impact it has on Major League Baseball.’’ Boras "believes that MLB should prevent prospective ownership groups from purchasing franchises if they plan to reduce their payroll to help pay for the club" (USA TODAY, 11/16).