Buy me some peanuts and stadiums ...
Another baseball season is upon us.
That means it's time to check the stats in Forbes ' annual look at the always slightly fuzzy finances of Major League Baseball Inc., arguably America's most taxpayer-enhanced sport.
This year, Forbes focuses on the Seattle Mariners, a small-market franchise that went a lousy 63 and 99 on the field last season but has quietly led the majors for five straight years in what counts most in pro sports -- team profits.
The Mariners, says Forbes, are worth $414 million, which is fifth behind the mighty Yankees ($950 million), Red Sox ($563 million), Mets ($505 million) and Dodgers ($424 million). The poor Pirates' market value is $218 million, or 25th in the league, with a decent 2004 operating income of $12.2 million on revenue of $109 million.
How can Seattle, the 20th-largest baseball market, be fourth in the average annual revenues over the past five years ($163 million)• How can it be fourth in attendance (3.3 million)• And how in the name of Barry Bonds has it averaged a gross profit of $17 million a year since 2000, when the Yankees lost $37 million last year?
Well, for one thing, the Mariners have a better-than-usual sweetheart stadium deal: Taxpayers paid 63 percent of the cost of Safeco Field's $517 million price tag. Plus, the team runs the stadium and keeps all revenues, including an estimated $5 million to $8 million a year from graduations, proms and parties.
But a large part of Seattle's success, says Forbes, is its Japanese connection.
Nintendo is a 54 percent owner of the Mariners. And it also forked over the money so the team could sign Japanese superstar Ichiro Suzuki, a 1.3 billion-yen-a-year ($12 million) singles hitter who has boosted attendance and made Seattle a prime U.S. destination for Japanese tourists.
As former Texas Rangers owner George W. Bush and former owners of the Reds, Indians, Brewers and A's know, the best way to get rich with a small-market team is to sell it -- preferably after getting local taxpayers to drive up its value by paying for a new ballpark.
But baseball's gravy train might have left the station. Reason magazine, in "Demolishing Sports Welfare," says two big court cases expected to be handed down this year "could bring the taxpayer-financed stadium-building boom of the past 15 years to a merciful halt."
Of course, it's a little late. According to Reason, the cost to taxpayers of subsidizing 66 major stadiums, ballparks and arenas between 1990 and 2003 was more than $10 billion.