TDA Bullpen - Our Writers' Blog

Saturday, May 08, 2004

Crying in Beertown
This week a pair of financial reports on the Brewers were released. The local press, which has always treated the franchise with kid gloves, started their account with the following paragraph:

With the release of two independent financial reviews of the Milwaukee Brewers, baseball fans learned Thursday that team debt has jumped to $133.2 million and that local baseball revenue has declined 28.7% in the last two years to $59.4 million in 2003.

Sounds like the Brewers are in big trouble, right? Well, consider that the average team debt is baseball comes in at around $120M, on top of that, note that the average debt for a team with a brand new ballpark is $140M. So the Brewers debt situation isn't doing that badly. What about the 28.7% decline in revenue? Well, that's a great example of lying with statistics. Here's a chart not found in the Journal-Sentinal article:

Year	1998	1999	2000	2001	2002	2003
Local Baseball Revenue	$36.6M	$35.2M	$39.6M	$83.3M	$68.6M	$59.4M

How about this statement - In 2003, coming off a 56-106 season, the worst in franchise history, the Brewers saw a large drop in attendance from their 2001 season when they unveiled Miller Park. However, the $59.4M in local baseball revenue represented a 50% increase over 2000, the last year that the Brewers played in County Stadium. County Stadium was replaced by Miller Park, at a cost of $425M, the lion's share of the cost of Miller Park was paid for by the tax payers of Wisconsin.

One interesting this is their listed operating expenses. For 2003 they list total expenses as $103.8M, with a player payroll of $48.3M. We can compare them to ten years ago by looking at the May 10, 1994 issue of Financial World. They list financial numbers of all the baseball teams, and for the Brewers they list total operating expenses of $48.5M with a player payroll of $27.8. So in ten years the Brewers payroll jumped from $27.8M to $48.3M, roughly 74%. This isn't a huge surprise, the owners are always badmouthing their product, talking about those greedy players. But what about those non-player payroll expenses? In 1993 this number was $20.7M, in 2003 this was $55.5M! That's a 168% increase! While the owners complain about players' salary demands making their financial picture dark, their "other" costs grew at twice that rate over the last ten years. The percentage of player salary in terms of total costs dropped from 57% in 1993 to 47% in 2003. Of course, all of these non-player salary costs are above the board transactions. No sleaze here. The Brewers would never make an arrangement with Selig Leasing, getting the use of 40 cars for $521,000 last year...

What's the point of a free press if they simply parrot what the big interests want you to hear?

posted by David 9:01 AM