The who isn't fans either. It's WHAT us fans do (or don't) IN COMBINATION with the other factors that make for the dreadful state of the Marlins. There's going to be no easy fix. It won't be fixed simply by replacing Loria or ridding ourselves of Huizenga or appeasing fans. Nor will just a new stadium fix it.

 

I agree 100 % rferry, and it may just be that this is such a damaged market the team really does need to move. I hate saying that, but its close to that point I believe it can never recover. Its going to take something extraordinary on the field to ever get the town excited beyond the one to two seasons of "new stadium glow" for the fans. They will need to see something on the field. Losing Cabrera & Willis will not help.

 

It may just be we haven't hit rock bottom yet in the history of this sad sad franchise. :confused

I think all it really needs is some patience and some faith among the various parties. A new stadium would allow the Marlins' ownership to be stable and able to do things to attract fans. A new stadium would also show fans that the team will be around and worth considered their own. However, it's going to take time. What a new stadium does is provide a base for the Marlins to exist and perhaps thrive. Without it, a model for Marlins success doesn't hold. The Marlins and/or fans can't do their part under such conditions.

Oh I agree, when I say range I don't mean range factor. But I don't like ZR much, either. It's outdated by other metrics and really not that good at all, many holes in it.

 

If you're going to use ZR, atleast use RZR. And while Uggla is dead last in qualified majors in RZR this year, he's third in OOZ. This shows he has good range, since he's made several players outside of his zone. He just sucks as a fielder this year, as can be seen by his 2006 RZR, when he was 9th in the league (and third in OOZ, again showing his good range).

 

Hanley also shows that he has good range but is just a bad fielder (bad RZR, good OOZ), and that he's also slacked of majorly this year (was second in OOZ last year, middle of the pack this year).

 

My personal favorite metric is Dewan's plus/minus system, and Hammer is third-worst by that. The other numbers haven't been released for this year, but I know Hanley was the worst SS at the all-star break and Amezaga was the 5th best CFer.

Yes, the revised Zone Rating is better than Zone Rating but is there a website that list those stats for all the players for free?

 

If the plus / minus system you're talikng about is from the Fielding Bible guy I agree taht's a good one.

First: http://www.hardballtimes.com/thtstats/main...p?view=fielding

 

Unfortunately, they don't filter out unqualified players for OOZ, so it's harder to "rank" by a player by that metric when he has a low OOZ.

 

Second: Yeah, that one. Unfortunaely, the only place I know to find those stats post 2005 (2003-2005 is on Dewan's site) is in the books Hardball Times release, and every now and then when Dewan says what a player's is.

PositiveHype, MLB and Selig will not spite an owner to help save a team over a principle MLB, Selig and the owners have fought tooth and nail to defend. You'll see the Marlins disappear before you see Loria forcibly replaced by MLB or MLB back down from requiring MLB host cities to pay substantial portions of the cost of a new stadium.

Let's see the online article, buddy.

 

I'm still waiting. Keep dancing, though, it suits you.

 

And, of course, still fitting and fantastic that name calling is what you need to resort too.

 

And that was after I specifically asked that this not turn into a flame war. I'm disappointed in you 2003. I had hoped that this would be a decent fruitful & informative discussion between mature adults. 2003 please refrain from the name calling.

I think all it really needs is some patience and some faith among the various parties. A new stadium would allow the Marlins' ownership to be stable and able to do things to attract fans. A new stadium would also show fans that the team will be around and worth considered their own. However, it's going to take time. What a new stadium does is provide a base for the Marlins to exist and perhaps thrive. Without it, a model for Marlins success doesn't hold. The Marlins and/or fans can't do their part under such conditions.

 

Well said rferry. I guess that just pretty much sums up a lot of what I had already thought. You confirmed it.

 

What will happen if after several years the crowds dwindle once again ? Can the team try to get out of their lease ? What happens to the stadium then ? Minor league franchise ?

PositiveHype, MLB and Selig will not spite an owner to help save a team over a principle MLB, Selig and the owners have fought tooth and nail to defend. You'll see the Marlins disappear before you see Loria forcibly replaced by MLB or MLB back down from requiring MLB host cities to pay substantial portions of the cost of a new stadium.

 

I could very easily see Selig forcing Loria to sell

 

Loria doesnt have the finances to keep the team competitive, and wouldnt even with a new stadium.

PositiveHype, MLB and Selig will not spite an owner to help save a team over a principle MLB, Selig and the owners have fought tooth and nail to defend. You'll see the Marlins disappear before you see Loria forcibly replaced by MLB or MLB back down from requiring MLB host cities to pay substantial portions of the cost of a new stadium.

 

I could very easily see Selig forcing Loria to sell

 

Loria doesnt have the finances to keep the team competitive, and wouldnt even with a new stadium.

 

We'll be Arizona'd before Loria's forced out. ITBIoB isn't meant to kick someone out, as much as I'd like to hope it would.

PositiveHype, MLB and Selig will not spite an owner to help save a team over a principle MLB, Selig and the owners have fought tooth and nail to defend. You'll see the Marlins disappear before you see Loria forcibly replaced by MLB or MLB back down from requiring MLB host cities to pay substantial portions of the cost of a new stadium.

 

I could very easily see Selig forcing Loria to sell

 

Loria doesnt have the finances to keep the team competitive, and wouldnt even with a new stadium.

based on what? pure conjecture?

PositiveHype, MLB and Selig will not spite an owner to help save a team over a principle MLB, Selig and the owners have fought tooth and nail to defend. You'll see the Marlins disappear before you see Loria forcibly replaced by MLB or MLB back down from requiring MLB host cities to pay substantial portions of the cost of a new stadium.

 

I could very easily see Selig forcing Loria to sell

 

Loria doesnt have the finances to keep the team competitive, and wouldnt even with a new stadium.

 

You see and say a lot of things that don't make any sense.

 

So this statement is not unexpected.

Interesting thoughts.

 

As for the ownership, I probably agree that Selig wouldn't force Loria to sell, but I think he did tell Loria that he had to fill in the financial gap for the stadium one way or the other. So, you never knows what can happen if he sees that the deal an get done, but is being held back by the Marlins ownership refusing to fill the gap for whatever reason. You also have to consider the personality of Mark Cuban. It's just a matter of time before he does snatch out a MLB franchise from someone. I really doubt that if Selid saw that someone like Mark Cuban can get the deal done, that he would rather let the franchise fade out because Cuban is the type to make it a major public relations nightmare for MLB. Look at how he takes on the likes of David Stern and he's much more of a challenge than Selig.

 

As for the player transactions; I didn't site Hanley or some of the other guys because they are younger than Uggla and I'd like to see them at least 1 more season at their current positions before I look at moving any of them. Also, I mention Uggla because he has always been known as a defensively weak player back to his days in the D-Backs system and before. Willingham I know is kind of on the same level of having defensive struggles, but he is again one of the more effective bats in the line up and he is playing a position that, due to his limited experience in LF, I'd like to see him there for another season before I make a decision. The fact is that you can't change an entire roster in 1 offseason. You have to look at your biggest needs and go from there. I think that the type of player that Uggla is can easily be replaced by what we have. This season he has been a .250 hitter with power who doesn't field well---we can replace that. Also, I'm one of the believers of you build your defense up the middle. In my post, I did propose a change at 3 of the 4 positions up the middle. In baseball terms, that a drastic change, especially when 1 of those positions is catcher. The last time the Marlins mae a change at morethan 1 of the middle defensive positions was in the 2002 offseason when they let go of Charles Johnson and Preston Wilson (who were both offesnively like Uggla) and returned with Juan Pierre and Ivan Rodriguez who had less strikeouts, higher batting Avg., and more SBs and all we really sacrificed was a weaker arm in CF. Sometimes the combination of players on your roster doesn't get wins even though when you look at the talent individually, they are all strong players.

 

Just my thoughts.

I don't see them doing anything with Uggla, a 45 double, 30 hr guy under fiscal control for several more years unless they can get some blue chip minor leaguer back. He isn't Robbie Alomar out there but I wouldn't call him a butcher at 2nd

I don't see them doing anything with Uggla, a 45 double, 30 hr guy under fiscal control for several more years unless they can get some blue chip minor leaguer back. He isn't Robbie Alomar out there but I wouldn't call him a butcher at 2nd

Throughout history of baseball it is a rare commodity to find 2nd basemans who have hit 45 doubles and 30 homers . Uggla is probably our best defensive infielder right now. Marlins have no reason to trade him what so ever

:whistle

 

Damning, that's all I have to say. Credibility...non-existent.

I would like to point out if Loria keeps on pocketing the Revenue Sharing funds instead of investing in the Franchise. The other owners will push Selig to take drastic actions. That alone may force Selig to have Loria put the team up for sale

And I'd like to point out that you have no proof or reason for your accusation.

I would like to point out if Loria keeps on pocketing the Revenue Sharing funds instead of investing in the Franchise. The other owners will push Selig to take drastic actions. That alone may force Selig to have Loria put the team up for sale

im more likely to see jesus christ outside my window tonight than for that to happen

And I'd like to point out that you have no proof or reason for your accusation.

RFerry you keep on saying this, this isn't my complaint this has been abundantly written about even before the season has started, there is great displeasure amongst the owners

Rferry I know this isnt the first time you are hearing about it so stop being an apologist for the ownership

Mind producing the many articles? I seem to recall displeasure among unnamed baseball officials regarding the Marlins' 2006 salary. However, they did not state why or go as far to accuse or even suggest certain owners were pocketing revenue sharing transfers. I also recall a number of columnists suggesting owners were pocketing and that a salary floor may be introduced. However, much like the many posters here, they did not offer proof that their opinion was anything but just that. Nor did many show a great understanding for the allowable expenditures those transfers could go to.

I guess we will have to get someone from The Marlins organization, one of their beancounters to open up their mouth or show us their books that way your trust in the Marlins ownership can be affirmed, or otherwise my distrust can be substanciated. Either way it's never going to happen

The questions at the table are was (1) Brattain correct in his assessment? Are (2) Brattain and Zimbalist of like minds, do they agree and does the latter provide the former with proof of his allegations?

 

My position is that Zimbalist actually understands the economics and tax consequences of what he's saying (see all his books, lectures, papers on the subject, etc.) and Brattain does not. Brattain has made a career out of hating on Loria and company. What he has done in the case of this article is take a small piece of tax law, misapply it and claim it as fact.

 

 

While I disagree with some theories Zimbalist has espoused that isn't the discussion at hand. There's a lot of criticism of Zimbalist on the web, and I don't mean by that by the lunatic fringe, and I use the word criticism to mean discussion of differing points of view, often by accountants and others who ply their trades in this same universe. But not on this subject. For today, I'm just taking Zimbalist at face value, accepting what he says because in the end he doesn't support Brattain's contention anywhere.

 

 

The issue really becomes one of "did people actually read what Brattain wrote?" because as you will see below in this short recap before I explain why he's wrong - and why most people who buy into the general theory the Marlins are making millions of dollars, pocketing the money (a favorite phrase here) and covering it up with tax losses - are wrong, ignoring for the moment that his math is wrong, Brattain's underlieing belief is fatally flawed.

 

Just so no one can say I used numbers they don't agree with I'm using Forbes Magazine baseball valuation numbers, the very same ones the most vocal critics of the Marlins love to quote over and over and over.

 

But here is what Brattain says:

"As you know the Marlins were purchased by Jeffrey Loria for about $150 million in 2002. Over the first five years after purchase an owner can amortize 50% of that. In other words, the Marlins can make a book entry in the loss column in years 1-5 of ownership for $15 million.

 

They've owned the Marlins for four full seasonsergo $60 million of their purported "loss" are from that. Furthermore, the value of the franchise has increased over that same span almost $70 million."

 

Brattain makes a declarative sentence. The "purported losses" of the Florida over the period 2002-2005 was due to a depreciation allowance, the clear implication being they made a profit during the five year but hid it by using these tax write-offs.

 

 

Except that Forbes, as I'll show below, disagrees.

 

 

Anyways, back to the point, here's what I said:

 

"4. Even Swift's favorite source Prof(essor Andrew) Zimbalist concurs the tax laws (IRS) regarding amortization do not apply as quoted here but when you're on a roll and you have a man's reputation to destroy, heck why let the facts get in the way."

 

Zimbalist does not stick to Brattain's hard and fast 50% rule, rather he correctly says:

 

"generally", Zimbalist writes "baseball owners generally may attribute 50% of the price they pay for a franchise..."

 

 

leaving open numerous possible economic scenarios. Nor is it written anywhere by Professor Zimbalist that during the five year period the Marlins were otherwise profitable. There's a significant difference between the fuzzy math Wayne Huizenga used to claim a $13 million loss in 1997 and Zimbalist rightly exposed that as a fraud (using the fact he was also the landlord to gain a tax advantage) and the Marlins situation where they are the lessee under the worst lease in baseball.

 

 

Further he states and more to the point: (see link from Biz of Baseball) Read 57 & 58 (and please the screen capture is presented only to show the reader where the operative language is but to put it in context read the available pages before and after this pull-out to get a wider understanding of what's being postulated)

 

STOP HERE GO READ THE FIRST LINK, scroll up and start at the top of the chapter

 

 

http://books.google.com/books?id=aX-GBXLQN...1czRCE#PPA57,M1

 

 

 

based on his notion that his example team is worth $400 million in 2003 when the book was written and had cummulative short and longterm contracts worth the magic 50% or $200 million which is somewhat believable when you think of which franchises were worth $400 million then and the money they spent annually and on longterm contracts. (Keep in mind if you're paying a player $15 million for five years, and he stays with your club for the term of the contract, that's $75 million right there. So getting to $200 million with Zimbalist's mythical team makes sense if you're a highly profitable team in a big market with boatloads of positive cashflow, and you would have to be to be worth $400 million in 2003. In 2007 half the teams in baseball, in fact more, are still below Zimbalist's $400 million valuation threshold. Forbes 2007 Team Valuations

 

 

But let's go back to what I said, "Zimbalist concurs the tax laws (IRS) regarding amortization do not apply as quoted here..."

 

And the reason I make that statement is because Zimbalist, being an expert on tax law as it affects sports generally, not just baseball, he has written after all on the tax implications in football and soccer) would never make the same mistake as Brattain, which is to confuse when and how that depreciation is used. For whatever problems one might have with some of Zimbalist's theories, he is an he is an economist, an expert, he consults to Forbes, and in fact he consults to Major League Baseball. Clearly this is a man who understands the tax consequences. This is why as you read his words he uses words and phrases like "may" and "up to" and "generally" repeatedly. (By the way, one thing worth mentioning is the IRS does not differeniate between sports - hockey, baseball, basketbal, football and I assume soccer are all treated the same by the IRS)

 

 

Sports "Up to 50%" Rule in Zimbalist's words

 

"...when an individual buys a franchise, he is allowed to amortize the value of the player contracts up to (a presumed) 50 percent of the purchase price..."

 

 

...he goes on to say it's a very valuable tax shelter. And it is. Were someone to ask me, I would say it's too good a deal and ought to be eliminated.

 

 

Why? because it's double dipping for the first five years "if you're making a profit". The team is already writing off player salaries as a legitimate expense every year but during the first five years they can also claim it as a depreciable allowance. If I have one complaint with Zimbalist it is that he looks at profitable teams and applies the same logic and set of beliefs to teams that are either margnally profitable, or unprofitable. But for today I'm not arguing he's wrong, intellectually, numerically or otherwise. A lot of what he says is interesting even if you don't buy in 100% ( with Murray Brown ),

 

 

And just claiming you have 50% doesn't work anymore either.

 

"The process of convincing the IRS to even grant the 50 percent deduction became harder when local auditors usually assigned to Despite a World Series title, random projects were replaced by national auditors who specialized in the finances of sports teams, said Carl Fortner, a tax partner on Foley & Lardner's Sports Industry Team, which has counseled several professional team owners on tax issues, including Selig. In October, the IRS sent a 15-page memo to those that audit teams to be aware of the latest government standards as it applied to taxing franchises.

"The IRS has been much less receptive to greater deductions because franchises cost so much

these days," said Bob DuPuy, president and chief operating officer of Major League Baseball.

Whereas it used to be automatic that a team owner could attribute a huge chunk of the franchise

price to player salaries, team owners now have to hire auditors who determine a true market value for the player's contract instead of the actual dollars being paid to player.

It is that value, according to Fortner, that is shown to the IRS. Unlike decades ago, where owners

would simply spread the costs over the first five years of ownership, player contracts in most cases now may be depreciated based on the length of individual contacts. This debunks the theory that new owners are more likely to sell after their fifth year of ownership because the write-off period is longer. Plus, owners are allowed to depreciate other intangible assets, including season ticket waiting lists

and suite revenues."

 

(Depreciation Accountancy from ESPN )

 

 

From the definition work on sports and the IRS, the IRS says:

 

(see link from The Business of Baseball - go to link, for IRS rules but SCROLL TO THE TOP OF THE SECTION TITLED "Profitability" AND READ THE ENTIRE SECTION )

 

http://books.google.com/books?id=0QrLjDDES...IzzI_E#PPA82,M1

 

 

 

The IRS citations regarding how and under what condition(s) the 50% rule applies are clear, a furtherance of Zimbalist's somewhat liberal use of the word "generally", which turns out to be a different percentage calculated on a case by case basis and confirming the Fortner article above.

 

Another important article to read is in regards to assets, tangible and intangible, and how they affect the economics of baseball from a taxable standpoint. This is actually a good article to read as a life lesson, it explains more or less in lay terms what you can can't do, why you can do some things and not others, whether buying a tractor or a house or a baseball team this, while lengthy is an excellent read.

 

 

Depreciation Allowance Recapture and Tangible vs Intangible Property

 

 

For our purposes we're focusing on the tenth paragraph titled

 

"Other Intangible Property Subject to an Allowance for Depreciation

 

Intangible personal property subject to the allowance for depreciation also constitutes Section 1245 property, including personal property rights such as patents, copyrights, and subscription lists, employment contracts such as basketball and baseball player contracts, covenants not to compete which are subject to the allowance for depreciation, and media rights to films, video tapes and sound recordings. Regs. Section 1.167(a)-3. As these properties all provide for a depreciation allowance, these properties will, if disposed of at a gain, be subject to depreciation recapture under Section 1245."

 

In this case "disposed of at a gain" means eliminating the obligation, the portion of a player's contract left that the team was originally entitled to amortize is now recaptured. So if you have Bob Jones at $30 million for five years on your books when you bought the team and you trade him in year two, you've saved paying him $24 million but you've also lost the depreciation going forward on the rest of his contract. And what did the Marlins do over 2002 and early 2003? They traded away four of their highest paid players, thus triggering a recapture, or dilution of the depreciation allowance. Brattain's orginall premise is wrong on it's face.

 

 

If you've read this link

 

 

 

this is just further confirmation of what was stated above, the IRS gives itself the right to determine in each and every case the worthiness of any depreciable allowance for player contracts and that the IRS position is an owner cannot allocate 50% to player salaries at the time of the purchase and sale without first satisfying auditors who will foresenically evaluate each contract. In short, the owner must prove he has 50% of the purchase price in salaries and the IRS will challenge every application for player contract depreciation. More importantly, as is seen in the exhibit, the depreciation allowance only applies so long as those players remain with the team.

 

The Marlins were purchased for $158 million (not the $150 million Brattain uses). The total depreciation allowance was created by taking payroll in 2002 which was $46 million ($ 41 million on USAToday, $46 million on Forbes, I assume the difference is minor league guaranteed contracts, players coming and going, etc.) plus what was owed to just a few players with contracts longer than a year (see roster, go to Cots, look at the historical contract of each player, you have to follow them to the team they on now, except for Charles Johnson who you can find a story on Google regarding his contract) All together the Marlins had approximately $92 million in contract and longer term contractural obligations (Floyd, was in the last year of this contract and headed to free agency, Wilson, Johnson, Lowell, pretty much the rest were on one year contracts. 2002 was also the last year of Beckett's original deal). Dempster had a multi-year deal in place, but it was small money, if memory serves somewhere around a million dollars over two years.

 

 

Even before 2002 was over the team reduced its potential player contract depreciation by roughly $3.5 million when Cliff Floyd and Ryan Dempster were traded mid-season. The next season Wilson and Johnson, who at the beginning of the 2003 season were owed collectively $52.5 million ( Wilson/Johnson remaining contract value when traded ) are traded to Colorado. So when you do the math at the end of the day the Marlins had as a result of the purchase at most potentially about a $30-35 million writeoff over the five year period.

 

This dovetails with David Samson's oft-quoted remark:

 

 

""If we had a loss of $60 million on paper, but $20 million in cash, that's a

big difference," said David Samson, president of the Marlins, which

reportedly lost $20 million last season despite winning the World Series.

"But the only number Jeffrey cares about is that actual cash loss. The

benefit of depreciation is far outweighed by the reality of cash losses

when you are losing money operationally."

 

( From ESPN )

 

This quote has been widely misinterpreted. His contention is, and correctly, that paper losses are worthless when you're losing money, the only thing that matters is how many real dollars the franchise actually lost. It should be noted here Forbes (see chart below) says the loss in 2003, the World Series year, was $14 million, and we can argue all day which is the right number $20 million or $14 million, but the point is made the Marlins, because of their lease, even with all $ from the playoffs, parking, mechandising, concessions, etc., still were unprofitable BEFORE ANY DEPRECIATION OR OTHER ALLOWANCE OR WRITE-OFF WAS TAKEN.

 

 

Write-offs do one thing. They shelter "profits". YOU HAVE TO HAVE PROFITS TO SHELTER or the depreciation allowance, or any other write-off is useless. You can't go below break-even on a cash basis.

 

This is where Brattain went wrong in his lust to paint Loria as nefarious.

IF YOU LOSE $2 MILLION BEFORE DEPRECIATION AND HAVE $20 MILLION IN DEPRECIATION UNCLE SAM DOESN'T WRITE YOU A CHECK FOR EITHER $2 MILLION OR $22 MILLION. YOU LOSE THE MONEY, TOUGH LUCK. And in a partnership, Loria couldn't just grab these losses for himself, he would have to distribute them among all the partners, and since MLB frowns on this action anyways, it's reasonably safe to assume it didn't happen.

 

 

I've been alluding to this all along but let's go to Forbes and use their numbers for the period 2002 - 2006 because after all I wouldn't want someone to say I was cooking the books.

 

 

2002 - 2006 is the five year period when the player contract depreciation "may" be used. It expires worthless after that. There is no carryover.

 

 

 

(on the left) These are Forbes Operating Income numbers for the Florida Marlins. According to Forbes the Marlins made $1 million in 2002, lost 14 million in 2003, lost 12 million in 2004, made $3 million in 2005 and in the last year the depreciation allowance can be used - 2006 - the Marlins lost 12 million.

 

Operating Income is calculated BEFORE interest, taxes, depreciation and amortization or as its known EBITDA. (Forbes defines Operating Incomes as follows: "5Earnings before interest, taxes, depreciation and amortization.")

 

Go to the Forbes website link provided here:

 

http://www.forbes.com/lists/2007/33/07mlb_...ins_336786.html And let's be clear on one other thing, Forbes revenue numbers include estimated revenue-sharing etc and other distributions, from MLB for all teams, not just the Marlins.

 

 

So in reality, of all that depreciation allowance theoretically created by the purchase of the franchise and allowance of player contracts that Brattain makes such a big deal over, the Marlins "generally" had reason to use, if you believe Forbes, and those are the numbers the naysayers keep pointing at, a grand total of $4 million from the sale, and this is if they didn't have a single other item like interest on and depreciation of hard assets they could of used instead.

 

 

In short the depreciation allowance created by depreciating player contracts from the purchase of the franchise in 2002 was virtually worthless and not as Brattain suggests the reason the Marlins "purportedly " lost money.

 

The reason the Marlins lost net $37 *34*million from 2002-2006 is because BEFORE DEPRECIATION they lost $37 *34* million.

 

That's what Forbes says. Not because of hocus pocus math, they flat out lost money. And I suspect when the final 2007 numbers are in (re: Forbes +$40 mil estimate) they may show a pre-ebitda profit, but (considering low attendance vs tickets sold) they will earn less from parking and concessions, merchandising, etc. which will drive down overall profits. Plus you still have a situation where salaries, just at the MLB level are twice gate receipts. But it's better than 2005 when it was almost 3 times.

 

 

 

 

I suggest you read the entire chapter online at the link provided. Above is the relevant section.

 

So, I think I've shown rather conclusively that Brattain was incorrect in what he said, that the Marlins "puported" losses were the result of player contract depreciation over the period 2002-2006. Not only was it not $75 million as he claimed (half of his $150 figure) Forbes doesn't agree with that assessment and neither should anyone here, and I doubt there's an economist or accountant that would disagree. They lost money during the period, $34 million, out of operating expenses, not because of any other reason.

 

This fantasy that the Marlins have been making money hand over fist is just that, a fantasy. People can cherry pick stuff from the Forbes reports all they want, but in the end the profitability graph shows it all. And we'll see where 2007 ends up next year when Forbes does their annual wrapup.

 

I hope people find this of value. It was an education for me.

Oh, 2003 that's adorable. You could have saved yourself a serious amount of empty time, effort and angst by just fessing up and admitting you misrepresented Zimbalist's stance. Even in this recent 'smoking gun' of yours, you have to concede that Zimbalist was incorrectly quoted by your initial stance, and I'll use your exact words:

 

4. Even Swift's favorite source Prof Zimbalist concurs the tax laws (IRS) regarding amortization no longer apply as quoted here but when you're on a role and you have a man's reputation to destroy, heck why let the facts get in the way.

 

Well, here's a newsflash, they do, you admitted as such

 

"generally", Zimbalist writes "baseball owners generally may attribute 50% of the price they pay for a franchise..."

 

Now, of course you'd like to spin the wheel and say that this leaves the door open for many practices, and it does, the greatest possibility of which is THAT THEY DO IN FACT ATTRIBUTE 50% OF THE PRICE OF THE FRANCHISE AS A PHANTOM AMORTIZATION LOSS.

 

Why do they do this? What benefit does it have?

 

Allow me to reiterate why Zimbalist holds this as the 800 LB Gorilla in the room of MLB finances.

 

Why would the Cubs (and several other teams) want to reduce their reported revenues? Let me count the ways. First, since 1996 MLB has had a revenue sharing system that levies a tax on a team's net total revenue. In 2001 this tax was 20 percent. Thus for every dollar in local revenue not reported, teh team saves just under 20 cents. Since WGN pays no such tax to the broadcasting industry, it is preferrable for the parent corporation, Tribune, to have the profits appear on WGN's books.

 

Second, baseball teams (and even the Cubs, who were pleading for public permission to erect higher left-field stands in 2002) seek various kinds of public support for their facilities. They believe that the more impecunious they appear, the more likely such support will be forthcoming.

 

Third, every few years the owners negotiate with the players over a new collective bargaining contract. The owners alway sseek new restrictions in the labor market to lower salaries. INvariably, one of the justifications for these restrictions is that the teams are losing money. WHether or not the Players Association is persuaded by such arguments, it appears to be permanently fixed as part of the owners' foreplay.

 

Fourth, MLB is the only professional sport in the United States that has a presumed antitrust exemption. Periodically MLB is called before Congress to justify this special treatment. One of hte arguments that MLB has repeatedly trotted out - most recently by Selig before the U.S. Congress in December 2001 - is that the industry can't possibly be abuising its market power because it is not profitable

That's on page 62

 

There is a very real benefit for teams of every economic standing to under represent their finances.

 

The rest of what you cited, I must add is not from Professor Zimbalist's mouth, as you promised it would be. It is an overly simplified attempt to make general tax law applicable to a major league franchise with closed books mixed with a presumed clairvoyance as to how every dime the Marlins spent, was spent.

 

You are a liar who misrepresented Andrew Zimbalist's work and in no way met the burden of proof so heaped upon you by your ignorant claims. The IRS tax law that you claimed to be the crux of your argument was attributed to Carl Fortner, of Foley and Lardner, a common tax firm that solicits anyone with a business for tax advice. They are not credible definitive voices in this matter in the way Zimbalist is. To make IRS law standardly applicable requires a complete disregard for the unique anti-trust exemption MLB has and has had since 1922 when the Supreme Court ruled in it's favor in Federal Baseball Club of Baltimore, Inc v National Baseball Clubs. If you're going to tell me that all of a sudden the anti-trust is inapplicable, then sure everything from Foley and Lardner is 100% applicable. At no point in your fact spinning did your quoted, attributable discussion from accountants ever once touch on the anti-trust. That's a disgustingly large oversight on your part.

 

Still, thank you very much for the tax lesson, too bad it is based heavily in opinion, and only quoted opinion features glaring oversight of the unique financial landscape of MLB, inapplicable to any and every other American professional sport.

 

Finally, I think you owe Spike an apology. You attempted to destroy his credibility by attributing a stance to Andrew Zimbalist that you have yet to prove. In no point in your poorly conceived diatribe did you ever show Zimbalist conceding that amortization is categorically inapplicable.

First of all your response is utterly predictable and transparent. And no I won't play your childish game of chase Swift around the tree. And further you can't put words in my mouth. I did not make any such promise that everything would come "from Zimbalist's mouth" nor am I a liar.

 

Second, you don't understand the economics, or you chose not to as is your choice. This is in regards to what Brattain said about the Marlins losses over the purchase triggered depreciation period. I've presented experts in sports accounting, IRS extracts, even your shrine Forbes magazine which I noticed you didn't try to dispute.. And as usual you demean anyone and everyone, professional or layperson who dares disagree with you. Basically you're an a**hole who can't admit there is room for any opinion except your own. Either you don't understand the difference between one of the most profitable franchises in the game, the Cubs and one of the least, the Marlins and why that matters, or you're an idiot, and I give you credit, I don't think you're an idiot. But here's the difference. One made money during the period. The other didn't.

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As for comments regarding the law firm of Foley & Lardner - and again there appears to be no one your won't insult.

 

Your comments and usual put-down:

 

"Foley and Lardner, a common tax firm that solicits anyone with a business for tax advice. They are not credible definitive voices in this matter in the way Zimbalist is."

 

Here's who they are:

 

Foley & Lardner is one of the oldest and largest law firms in America. (They are one of the top 25 firms in the country) Founded in 1842, the firm now has approximately 900 attorneys in 17 offices in Los Angeles, Sacramento, San Diego and San Francisco, California; Washington, D.C.; Jacksonville, Orlando, Tallahassee, Tampa, and West Palm Beach, Florida; Detroit, Michigan; Chicago, Illinois; Denver, Colorado; Madison and Milwaukee Wisconsin, and Brussels, Belgium. Foley & Lardner provides clients with top quality legal services in virtually every aspect of business through its six firm-wide departments: Business Law, Health Law, Intellectual Property, Litigation, Regulatory and Tax and Individual Planning.

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What say you in regards to Forbes' contention the franchise lost $34 million during the five year period? What say you regarding the worthlessness of write-offs when there are no profits to shelter? The answer is nothing except more of your bluster and insults. You do understand that the anti-trust provision unique to baseball don't change their treatment by the IRS in this case? Don't you? You're mixing apples and oranges. Next thing you know you'll call your concoction grape juice.

 

Burden of proof? Give me a break. The bottom line is Brattain was wrong.

 

The rest of your comments were your usual gibberish.

And Foley and Lardner continue to be just that, a large tax firm. They are not the preeminent sports economic firm in the country. Nor are they the preeminent sports economist, Zimbalist is, they are simply an obscure source that you attempt to incorrectly apply to MLB. Once again, we're back to square one, are you now contending that standard tax practices are the applicable standard to MLB? Are you completely disregarding the anti-trust protection in MLB?

 

As for Forbes, what say I? Comically hypocritical on your part to cite Forbes. After all, Forbes said the Marlins made $43 million in 2006. It's Good to be a Small Market Team, Marlins turn $43 million profit

 

What's that? All of a sudden, you're back to your initial stance that Forbes is just creating numbers, so that $43 million has to be an error? Oh, wait, wouldn't that discredit your drum-beating about Forbes.

 

EDIT: Here, I'll even make it easy for you to discredit that number, and in the process, discredit yourself.

 

?Forbes has never had access to financial information from Major League Baseball or the individual clubs,? baseball executive VP Rob Manfred responded, adding that Forbes? estimates ?materially misstate the financial performance of the industry as a whole and of the individual clubs.?

 

 

?They make these numbers up,?

 

Here's one more thing you're overlooking. If Forbes reflects the Marlins as having lost small sums from the 2002-2005 seasons, that still stands in direct contradiction to Samson's oft quoted stance of $20 million annually. Surely YOU of all people wouldn't want to paint Samson a liar. Someone's math isn't adding up here. Either the Marlins lost the aggregate $34 million you claim, thus making Samson a liar, or Forbes is making up numbers, making all your research completely and utterly worthless. Either way, you're undermining yourself. Loria and Samson have to be taken as believable at face-value...wait, no they don't. $20 million for 3 seasons isn't a total of $34 million, no matter how you slice it.

 

Finally, I truly don't even care about Marlins finances, I am debating you on your clear inability to represent Zimbalist's stance. I have yet to hear an admission of your wrong. Go ahead, I know it hurts, but apologize to me and Spike, you got Zimbalist WRONG.