Contraction

UPDATE, Thursday Evening: We have just learned that the A's haven't been contracted yet, so today MLB Bonus Baby has published its summary/analysis of Oakland's most recent draft. Enjoy.

It's a terrible topic. But there's no sense dancing around it. If - and it's a very unlikely if - MLB ever made a decision in the next 20 years to contract, these two things are true:

a.) They would contract two teams at the same time, due to the nature of daily MLB baseball.
b.) The A's and the Rays would be the two teams that were contracted.

This post will discuss the possibility of the A's and Rays being contracted out of MLB.

First, some background: I'm a huge A's fan, and I'd be crushed if my favorite team was contracted. My ideal scenario would be a new A's stadium in the San Jose, because I believe that to be the only location in which the current ownership will move ahead with building and financing, and because I believe that the corporate support that is crucial to a new stadium's success will be plentiful in San Jose, and wholly inadequate in Oakland.

This post started with a comment I made in the recent "What's Next for Oakland?" thread at vertigO's outstanding "New A's Ballpark" blog. VertigO/Marine Layer discussed the time line for the city of Oakland, mentioned that it would help the city's efforts to keep the A's if MLB ruled in favor of Oakland in the next few months, and then ended that blog post with this:

Oakland and its boosters would also have to get MLB to commit to bringing in a more Oakland-friendly group, a task which will range somewhere between difficult and impossible. Looking for Larry Ellison? Don’t bother, since he and his buddies will be investing $150 million either in San Francisco or Newport, RI over the next 2-3 years. At this point, I think it’d be more likely that MLB buys the A’s as they did the Expos and as the NBA is buying the New Orleans Hornets. If MLB can’t find a suitable buyer or Oakland drops the ball, then well, I really don’t want to go there.

My reply in that thread "went there" - it laid out a brief, hypothetical contraction scenario that seemed to divide the readership and raise a lot of additional questions that I will try to tackle here. Hopefully you'll weigh in with your thoughts in the comments.

Why the A's and the Rays?

With the Marlins set to enter a new stadium on Opening Day 2012, the Rays and A's will be the last two teams that are in dire need of a better facility. In a "worst stadium in MLB" conversation, The Trop and The Coliseum probably come up as #1 and #2 for the vast majority of people. Both franchises have had recent failed stadium proposals, and now face the daunting task of attempting to coordinate political will and half-a-billion dollar financing in a down economy. There's legitimate reason for skepticism that either franchise will be able to build.

Conversely, the other 28 franchises in baseball are all in facilities that were either built or significantly renovated in the last 20 years, with the exception of the Marlins, who will be in a new facility in 2012.

So, why not simply relocate the A's and Rays?

My guess is that the next two "relocations" in professional sports will be ones that place an NFL team in LA, and an NBA team back in Seattle. Those are huge markets that have the corporate dollars and television potential to support a team successfully.

In MLB, no such lucrative open market exists. To MLB's credit, it has already expanded into all the best markets in the United States, and stayed there successfully. All of the candidate cities that are routinely discussed for expansion or relocation would have the effect of cannibalizing a share of the lucrative television market and fan base of an existing franchise. Perhaps that's true of an NFL or NBA move as well, but the financial gain of getting those leagues back into Los Angeles or Seattle might offset it.

MLB has little incentive to relocate two revenue-sharing recipients into new small markets where they will simply continue to be revenue-sharing recipients.

Okay, as much as I hate to discuss this, I'm now actually thinking about contraction. When might it happen, and what would it look like?

I think the A's and Rays have a window of 15 years, max, to resolve their stadium situations. The Rays' stadium lease ends after the 2027 season. If the A's are still in the Coliseum at that point, and the Rays still at the Trop, it would mean that both franchises' last efforts at building a stadium locally had failed. It might also mean that the current ownership groups of each franchise had sold their franchises. And if they did sell, it would extremely difficult to get new, wealthy buyers in those two markets.

I'm envisioning a scenario where Major League Baseball buys both franchises about 15-20 years from now, and then dissolves them. If the A's and Rays are in their current facilities that long, I think their attendance would be horrific - think Montreal Expos in their final few seasons. The fan bases would probably have every right to react that way, as they smelled contraction in the air, shoestring payrolls, and no new facility in sight. This would also hurt franchise value, making it easier for MLB to purchase the two franchises.

This would reduce the amount of teams in the AL to 12, requiring some franchise shuffling. At first blink, you'd want to move one NL team into the AL West and one in the AL East, to replace the two contracted AL franchises. But imagine how much that NL team would howl about moving into the AL East, a veritable playoff death sentence. So instead, I'd envision this:

1. The Astros move from the NL Central to the AL West.
2. The Rockies move the NL West to the AL West.

This improves travel for the four remaining NL West teams by removing Colorado, and for the four-team AL East by removing Tampa Bay. The other four divisions would each have five teams apiece.

The Pros:

1. Improved travel distances for the AL East and NL West, with the removal of TB and Colorado.
   
2. Slightly improved divisional symmetry and playoff odds - 14 teams in each league, no six-team NL Central anymore. Coupled with MLB's proposal to expand the playoff field to 10, teams would a better chance of making the playoffs. Ignoring talent disparity and its effect on true playoff odds for the moment: 5 out of 14 teams making the playoffs is 35.7% odds, compared to the current 25% (4 of 16) in the NL. Even the Pirates and Royals might occasionally make the playoffs with those odds. This would be right in line with the NFL's sweet spot of playoff participants (12 out of 32, 37.5%).
   
3. Slightly improved quality of play. Removing two teams means removing the 24 worst pitchers in major league baseball. The four worst catchers. From a fan perspective, are people going to miss these guys? None of them are on fantasy teams. There are 1,200 players on 40-man rosters in Major League Baseball at the beginning of each offseason. We are talking about removing the worst 80.
   
4. The market share of the Marlins and Giants increases. This is not any consolation for an A's fan, obviously. But Marine Layer speculated that the Giants' franchise value would approach Red Sox levels with the A's out of town. It makes sense - a beautiful stadium, the wealthy Bay Area, and no competition for the baseball entertainment dollar, or the next generation of paying customers. For the Marlins, eventually they could probably broker a better long-term TV deal by virtue of being the only MLB team in all of Florida and their increased market share.
   
5. Two of the biggest recipients of revenue sharing no longer need to propped up by the league's wealthier teams. The A's probably receive about $30M per year in revenue sharing. If the Rays received a similar figure, that would be $60M a year funneled back into the other 28 teams.

The Cons

1. One argument against this is that the league would be taking on a huge cost to purchase the A's and Rays to contract them. It would be hard to measure franchise values 15 years from now, but it would cost the league at least $500M to purchase the two franchises, and probably much more. The league - the 28 other teams - would have to absorb that huge cost. Eventually they would see a return on that money, by not needing to prop up two franchises through revenue sharing. But the return wouldn't equal that initial investment for a long time.
2. Another argument is that the MLB Player's Association - arguably the most powerful union in the country - would never accept the cutting of 80 jobs within their union. On this point, I disagree. I think it's a concession - one they would be opposed to, but one they could accept if it came with concessions from the owners, just like any negotiation between two parties. MLB owners have the power to make lots of concessions that would appeal to the Union - reaching FA at five service years instead of six, eliminating Super Two status and simply allowing all players to reach arbitration for the first time after reaching 2.000 years of service, raising the minimum salary to $500K, etc. Additionally, I think MLBPA has a track record of representing its more powerful, older, higher-profile members better than its younger, cheaper, low-profile members - and those are the guys who would ultimately lose their coveted space on a 40-man roster. This is a Union that filibustered steroid testing, has agreed to a minimum player salary that's lower than the minimum in a league with half the revenue (NHL), and steadfastly refuses the concept of fixed revenue sharing/defined percentage allocation to the players. All of those decisions are reflective of a union that represents its older, wealthier, higher-profile members far better than the cheap labor that would be affected by the cutting of the 80 worst players. The privately-expressed attitude of many of the unaffected, wealthy players to this proposal? Perhaps merely a shrug - "More pie left for me." (Note: this is a key point that Marine Layer and I respectfully disagree on, as evidenced by his comments in this thread at his blog. If you believe the Union will fight this to the death, that makes contraction impossible. I personally don't believe they will, for the reasons I just stated. Debate away in the comments).
   
3. Travel in the other five divisions would be excellent, but it would be brutal in the new AL "West", which would be a very loose term to describe a division that included Seattle, Anaheim, Colorado, Houston, and Texas.
4. If MLB ever hoped to further expand internationally, contracting these two teams would decrease that likelihood substantially. It would make little sense to contract two teams if the league simply planned to create two new expansion teams in the decade that followed. So, the contraction decision might also mean the decision to wave goodbye to the dream of a franchise in Monterrey, Mexico or Puerto Rico. The decision to contract is potentially an acknowledgment of a mistake from the league - "We over-expanded. We know recognize that MLB functions best as a 28-team league, and that's how we'll stay."

How would the vote go?

To my knowledge, the decision to contract would come down to a vote with the owners, and it would require 75% approval (please correct me in the comments if this is incorrect). Let's assume in this scenario that the league has already purchased the Rays and A's, and struggled to find new buyers in those markets. So the "contraction" vote would come down to securing 21 out 28 votes from the other owners.

Seattle would vote against this. They go from a four-team division to a five-team division, and their travel gets substantially worse by losing Oakland and adding Colorado and Houston. Anaheim might vote against it for the same reason. The Rangers might not complain, since they would get more lucrative, short-travel games against Houston and because their divisional travel improves with the addition of two time zone neighbors.

Colorado and Houston might vote against their being moved from the NL, even though they were shown the courtesy of avoiding AL East placement.

That's four likely dissenters. Perhaps there's others.

In conclusion, I don't think this is very likely to happen, and I certainly wouldn't want it to happen. But if contraction did happen, I think it would happen 15-20 years from now, in the way that has been described here. What do you think?