In five hour meeting, MLB owners show hints of movement in new proposal

Bless You Boys

Major League Baseball’s owners and players met over a five hour period on Monday with the owners making two small proposals that hint at room for further movement. MLB increased it’s offer for a pre-arbitration bonus pool from $15 million to $20 million and bumped the number of teams participating in the draft lottery from three to four. That’s it. Not exactly earth-shaking developments, but at least a sign that talks may be getting more serious.

Players were said to be underwhelmed with the proposals, as the two sides plan to meet again on Tuesday, and possibly again all week as the owners’ deadline of February 28 to get a new deal in order to start the regular season on time draws near. The players being underwhelmed is no surprise as several other major issues are outstanding, particularly the competitive balance tax structure, which wasn’t addressed in the proposal, and the owners gave only a little bit on other issues today. MLB has been stalling negotiations since locking out the players on December 2nd and players have been reluctant to negotiate against themselves. That much didn’t change on Monday.

Owners made no changes to their proposals regarding the competitive balance tax, indicating that they made the last offer and it’s the players’ turn to make a proposal on that issue. MLB’s last proposal was an increase in the tax thresholds by one percent per year, while more than doubling the tax rates and adding first and second draft pick penalties to two tiers. Of all the proposals on the table from either side, this is the most absurd non starter of the lot, and the issue where the impasse seems most immovable.

Over the five hours that the parties were in the same building, they are said to have discussed a wide range of issues, meeting with each other and separately for periods of time. Here is where the two sides stand with a week left to hammer out a deal according to MLB’s time table.

CBA- Where they stand

Owners Players
Owners Players
Minimum Salary
$635,000 flat, no increases, not fixed $775,000 increasing to $875,000 over 5 yrs
$615K/ $650K/ $725K, no increases, fixed
Competitive Balance Tax
$214M- 222M $245M- $273M
50%, 75%+ 2nd pick, 100% tax + 1st pick 20%, 32%, 62.5% tax
No draft penalties
Arbitration Eligibility
3 years plus 22% of super 2 3 years plus 80% of super 2
Bonus pool
$15M, 30 players $115M, 150 players
Free agent compensation
Eliminated, but substituted with CBT penalties Eliminated
Teams losing FA get compensation
Service time manipulation
Draft pick for teams with star rookies Draft pick for teams with star rookies plus
One year service for some rookie players
Revenue Sharing
No changes Reduce total by $30 million
Draft Lottery
3 team lottery 8 team lottery, exclusions for repeat losers
International Draft
Included Not agreed
Advertising patches
Included Agreed
Expanded playoffs
14 teams 12 teams, if no regular season games lost
Universal DH
Agreed Agreed

The biggest obstacles remaining include:

  • MLB proposal to increase CBT thresholds by one percent per year
  • MLB proposed CBT penalties including draft picks and doubling tax rates
  • MLB proposed minimum salaries be fixed and not increase for five years
  • MLBPA proposal for 80 percent of two-year players to be arbitration eligible
  • MLBPA proposal to reduce revenue sharing by $30 million

MLB did drop its immediate proposal to contract the minor leagues further.

While there are large gaps in the much discussed “bonus pool” for pre arbitration players and in the CBT tax thresholds and minimum salary, these issues are still just numbers. The overall impasse can only be solved when there is real movement on the above list of non-starters.

The players cannot allow stronger CBT taxes and thresholds, having already given away the farm on those issues in the last CBA. One way or the other, the owners are going to have to move back toward the players there. On most other issues, they seem likely to eventually find a middle ground, though there’s still no telling how long that may take. At very least, the sustained talks now engaged this week are a sign that the owners have gotten things stalled to the point where the season is in doubt, and will now start bargaining for real. A quick resolution still seems highly unlikely.

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