Angels Finances - This could get ugly

[gotbeer]

I think the Luxury Tax is a foreseen conclusion.  It doesn't matter what they do really, the Angels will likely be operating over the tax threshold from here out.  But I think the Angels will continue to increase their payroll to keep up with inflation within baseball.  160+ million should happen next season, three years down the road we could see 170 million.  

 

But I think the biggest legitimate worry I have, is Arte willing to spend this much on a team that doesn't win?  I mean what's it going to take?  In my mind, two legit #2/3 SP, Garrett Richards pitching up to his abilities and either signing another LHRP or Maronde/Sisk/Roth pitching well in a loogy role.  That's a lot that needs to happen and it would likely take a payroll that's higher than what Arte is willing to spend right now. 

 

Double edged sword also.  If the Angels don't spend, the generational player may not stay.  

[ettin]

The team has zero debt so why is this a problem if they go over one or two years?

 

I understand that we are scraping the top of the ceiling but Arte knows what he is committing to with his money and if he chooses to go over the luxury tax threshold I would imagine he could without blinking an eye.

 

Also we have no idea what our share of Fox Sports West is bringing in, which could be substantial.

[austin724]

This is a stupid article. Everyone knows for a fact that if the Angels were winning right now there would be no talk about the financial condition of the team.  The team is in the best financial condition compared to most of the other teams.

[Second Base]

Lol geez, tell me what you really think.  Yeah that's the basic gist of it, how much is Arte willing to spend for a winning team? 

[Stradling]

So the Angels are now in financial trouble? They use to have a $110 million payroll with $50 million in TV revenue, now they have a $135 million payroll with $150 million TV contract. A bunch of chicken littles.

[JB Abell]

This is just another downer Angel post the purpose of which I don't understand. The Angels have no debt and have (on average) $150 million per year on their cable TV contract and lead the MLB in attendance. But it seems that a lot of posters here enjoy accentuating the negative. While it's true the team is performing at a level far below expectations, it does not mean the team is not is solid financial condition.

Party on.

Completely agree. Arte Moreno has tripled the value of the franchise since he took ownership 10 years ago. I'm not in any way worried about the financial situation. Moreno's choices may not translate on the field but he definitely knows how to run a business.

[mancini79]

It's amazing that the Angels allow their accountants to post on AWin.

 

 

(Where is that "sarcasm" emoticon?!!?)

[JB Abell]

Who structured this crap? We take two guys who are already over 30, and the older they get, the more they get paid?

Vernon Wells will look like a relative bargain by the time we reach the end of these two deals.

Its possible that in an effort to stay below the luxury tax line, they structured the contacts with less money paid out at the beginning. Inevitably they will go above the line, but in the long run it is a wiser business decision to save as much as possible before getting there.

[Vegas Halo Fan]

Its possible that in an effort to stay below the luxury tax line, they structured the contacts with less money paid out at the beginning. Inevitably they will go above the line, but in the long run it is a wiser business decision to save as much as possible before getting there.

 

As was detailed in another post, this shell game accomplishes nothing in regard to the cap. The cap figure is based upon the average annual value of the contract, not the current year's salary. Nothing "wise" about it.

[Second Base]

I'm sorry some of you perceived this as a doom & gloom post, I think most fans know I'm just not that type of writer and I'm an optimist by nature.  I think those who believed it to be that sort of article likely never read the article itself (I'm looking at you mods) and simply assumed this is what I was doing.  Not the case. 

 

As I said before, I'm no expert on finances and I'm still learning the finer points of contracts and the new CBA itself.  The very purpose of the article was to raise awareness to the fact that payroll will very likely go up exponentially beginning next year and to ask the question, is Arte willing to spend THAT much money for a winner?

 

I don't think anyone questions whether or not he wants to win, or whether or not he's willing to spend money on marquee names.  But for a team that never had a payroll too much more than 150 million, it's appearing likely that in order to get the winner that he wants, Moreno will likely need to spend up toward 170 million in payroll.  Is he willing to go that high?

[austin724]

Nobody thought he would go to 150 million, so yeah I think he will end up going to 170. 

[JB Abell]

As was detailed in another post, this shell game accomplishes nothing in regard to the cap. The cap figure is based upon the average annual value of the contract, not the current year's salary. Nothing "wise" about it.

Well that blows my theory. I thought i read every post, but guess i missed that.

However, I'm pretty positive the amount the tv contracts pay out increases every year so that may have something to do with it.

[ten ocho recon scout]

So let me get this straight. In ten years Arte has made 500 million dollars on the increased value of the Angels, and he signed a 3 billion dollar tv contract, but according to this post and many others he's a lousy businessman. Oh and by the way I'm pretty sure the team has no debt.[/

left]

Exactly.

The tv deal kicks in shprtly, and will net (last I heard) around 150 a year....is a 160 payroll (with the other ten coming from ticket sales, merchandise, etc), that big of a deal?

And something else to consider. Theres a reason teams rarely get sold, even perpetual losers/bad money teams. Its because they are highly profitable.

Even of the ownership of any team is 'losing' money on the team, they get to use that to off-set their gains in other ventures. Its very common among business owners.

Pujols' contract is ugly. But it also was part of the reasonwe got the tv deal in the first place. Spending 250 million to make 3 billion isisn't a loss (just on the field it is with how much of a bust pujols has been).

I'm not at all saying I like our finances. But its not as dire as some believe. (Again, last I checked, our current deal nets us about 50 a year, and were spending roughly 140. Our new deal will get us 150 a year....and were looking at roughly and extra 20 on our cost. Unless I'm missing spmething, I don't think its a huge deal)

[Vegas Halo Fan]

I don't believe that the team will be in financial distress, but I do believe that the two big contracts will have a significant impact on who is kept and who is signed.