Turn Off Ads?
Page 3 of 6 FirstFirst 123456 LastLast
Results 31 to 45 of 77

Thread: The Reds 2003 Revenue and Expenses

  1. #31
    You know his story Redsland's Avatar
    Join Date
    Nov 2000
    Location
    Norfolk, VA
    Posts
    7,714
    Originally posted by traderumor
    [B]One thing I'm a little confused on is how the Reds end up with $15.8M in revenue sharing when the City Beat article agrees with the Reds' position that they likely would be paying out instead of taking in. I realize that attendance was lower than expected, but that should not result in a postive share to the tune of $16M.
    The 2003 revenue sharing payment is based on results from previous years.

    As a point of comparison, Pittsburgh got a $10MM revenue sharing check during its first year in PNC Park. The next year the team only got something over $1MM, which suggests the Reds could get $0-6MM in 2004.
    Makes all the routine posts.

  2. Turn Off Ads?
  3. #32
    Member JaxRed's Avatar
    Join Date
    Apr 2000
    Location
    Jacksonville, FL
    Posts
    9,503
    It depends....... I bet the Reds get revenue sharing for 2003 based on 2002 numbers. So in 2003 they got money, but in 2004 they won't. Again, would be nice to nail down.
    The lowest acceptable payroll amount for ownership to show they are not greedy pigs is 15 million more than they are currently paying. No matter what that currently is.

  4. #33
    Member Spring~Fields's Avatar
    Join Date
    Sep 2001
    Posts
    8,630
    Nice work, something that many of us can read in accounting form.

    What about the tax consequences from a net income of 32,661,915 ?

    Are they exempt from
    Employers Social Security
    State Workmans Comp
    Federal Unemployment

    Are their insurance expenses lumped into Admin expenses?


    You have done a great job considering how difficult it is to get data let alone accurate data on the Reds revenues and operating cost.

  5. #34
    Where's my chair? REDREAD's Avatar
    Join Date
    Apr 2000
    Posts
    20,938
    The player payroll number will be low for 2 reasons. I don't have a link handy but all teams have to pay about a 6 million dollar charge for something as part of payroll.

    And you have no allowance there for benefits, etc. For example the Reds pay Social Security on all these guys.

    And yes, I think you'll find your 13 million figure will be WAY low.

    Social security is neglegible. There is a threshhold, at approximately 70-80k annually when
    no more social security is collected. Medicare taxes are still withheld, but that comes
    out of the employee's check.

    There was a ballpark estimate for annual benefit, insurance, etc. that I think WOY had. I'm not sure if that
    is included in the 13 million figure or not.


    You gave all the concession revenue to Reds. Only place I saw that had figures

    http://cincinnati.bizjournals.com/c.../16/story7.html

    showed that Reds got 30% of concession revenue which would be $4,946,043.90
    The above article is not relevant. That article said the 1998 CINERGY take of the concessions.
    Like most new parks, the Reds got a much more favorable split in concessions, parking, etc
    income.


    (Redsland wrote) You may be right. Community organizations still work the concession stands, presumably for a cut of the action.
    And while its nice that they let community organizations do these things, the fact
    is that it's kind of a ripoff. I've participated in several of these at different parks.
    The "volunteers" earn much less than minimum wage for the time spent, particularly if
    you factor in setup and clean up time.. It's a clever way to run concession stands for
    a very cut rate cost.
    Last edited by REDREAD; 01-28-2004 at 02:40 PM.
    Thank you Walt and Bob for going for it in 2010-2014!

    Nov. 13, 2007: One of the greatest days in Reds history: John Allen gets the boot!

  6. #35
    Unsolicited Opinions traderumor's Avatar
    Join Date
    Aug 2002
    Location
    Right Down Broadway
    Posts
    18,606
    After reading the Peterson article, and figuring that the Reds accrued the 2003 revenue sharing payment in 2002 operations(which is why JA warned us that we could really take a hit in the revenue sharing source of revenue in 2003) since it is based on 2002 results, I think the income that should be recorded for revenue sharing should reflect Jax's 0-6M estimate. So even if we go the conservative route and give them $6M, there goes almost another $10M to reduce the bottom line.

  7. #36
    You know his story Redsland's Avatar
    Join Date
    Nov 2000
    Location
    Norfolk, VA
    Posts
    7,714
    Originally posted by JaxRed
    It depends....... I bet the Reds get revenue sharing for 2003 based on 2002 numbers. So in 2003 they got money, but in 2004 they won't. Again, would be nice to nail down.
    Here's Doug Pappas's summary. No mention of lag, so presumably everything is based on the previous year.

    http://roadsidephotos.com/baseball/02-3CBA.htm
    "Local Revenue Sharing: Rises from 20% under the 1996-2001 CBA to 34%, net of ballpark expenses. Revenue sharing money divided equally among all teams. Following the recommendation in their Blue Ribbon Economic Panel report, the owners had originally proposed sharing 50% of local revenues."

    This means that 34% of the Reds' local net goes into a pool with the other 29 teams' local net. Each of the 30 teams then shares equally out of this pool.

    "Central Fund Revenue Sharing: $72.2 million (based on 2001 revenue figures) taken from clubs which are net payers in the base revenue sharing plan and given to those who are net receivers. This amount will fluctuate in conjunction with the base plan, and is phased in: 60% in 2003, 80% in 2004, 100% in 2005-06. Money is paid and disbursed in proportion to a club's distance from the average. Fluctuations intended to assure that the projected amount of revenue is transferred each season from the combination of local and central fund revenue sharing."

    The rich teams give welfare to the poor ones ona sliding scale.
    Makes all the routine posts.

  8. #37
    Unsolicited Opinions traderumor's Avatar
    Join Date
    Aug 2002
    Location
    Right Down Broadway
    Posts
    18,606
    Jax,

    It looks like your figures take the LTC and straight line per year based on the total contract amount. Is that correct? If it is, then that makes my point about amortizing deferred contracts moot since your calculation is already expensing a flat amount over the term of the contract.

    As an overall comment, it is somewhat disturbing to come down to the final numbers and, after making some proposed adjustments such as backing $10M off revenue sharing, the amount on the National TV money, upping overall Admin to $20M, you still have a $15M profit. That is a 14% net profit margin, which is not bad in any industry, but this is an organization who claims to be struggling to make a dollar in profit. That's another $15M that could be poured into player development and improving the ML team in higher salary levels.

    Yet, I don't want to jump the gun, because we do have some soft numbers like revenue sharing and Admin expenses. Are we missing a major expense? Is the Admin number too small?

    Still, Redsland, great work. Fire up the email campaign boys, I think the Reds FO has some splaining to do. And anyone who hangs out here knows that I am an overall supporter of management, but when you poor mouth and it ain't so, you've crossed a line.
    Last edited by traderumor; 01-28-2004 at 03:21 PM.

  9. #38
    You know his story Redsland's Avatar
    Join Date
    Nov 2000
    Location
    Norfolk, VA
    Posts
    7,714
    Originally posted by traderumor
    I think the Reds FO has some splaining to do.
    That's quite a statement coming from you, tr. Glad to have you on the dark side. :evilgrin:
    Makes all the routine posts.

  10. #39
    Member JaxRed's Avatar
    Join Date
    Apr 2000
    Location
    Jacksonville, FL
    Posts
    9,503
    We'll never know for sure. We simply don't have access to all the numbers. But I bet you when we do get the best numbers we can put together, the "profit" is fairly small or non-existent.

    Last time they did this (2002 I think) MLB showed Reds with 2 million profit, and Forbes with 4 million. Pre-tax. And that was in a year where we had received a one time "bump" of about 4 or 5 mill.

    You better wait till your numbers look good before you fire off those letters.
    The lowest acceptable payroll amount for ownership to show they are not greedy pigs is 15 million more than they are currently paying. No matter what that currently is.

  11. #40
    Unsolicited Opinions traderumor's Avatar
    Join Date
    Aug 2002
    Location
    Right Down Broadway
    Posts
    18,606
    Originally posted by Redsland
    That's quite a statement coming from you, tr. Glad to have you on the dark side. :evilgrin:
    I agree with Jax on the point of tieing some more numbers down, but one thing that I don't like about the last numbers is that they were arrived at in conjunction with Bud's appearance before Congress, IIRC, so I'm not sure that makes those numbers reliable since everyone deflated their numbers for that purpose. Of course, the Forbes $ being in the same range makes that a shaky argument to make.

    Redsland,

    I am in a business that I deal with management and owners of companies, so it is common for the employees or general public to be easily convinced that management is making money hand over fist, when they are usually pouring in their own money just to keep things going. That is one reason that I am more apt to believe the FO when they claim to be struggling to break even. But from this CPA's point of view, you have done very good work and have good support for many of your figures. Thus, I am now more skeptical of the Reds FO poor mouthing claims. Rather, it could very well be that the comparisons they are making are with profit margins when they say money is tight. However, they represent that they are breaking even at best. For 2003, that does not appear to be the case. That ought to make them very pleased for 2004, as they will have a difficult time even breaking even the way things stand today.

  12. #41
    Member 15fan's Avatar
    Join Date
    Oct 2000
    Location
    Atlanta, GA
    Posts
    5,500
    Originally posted by JaxRed
    The player payroll number will be low for 2 reasons. I don't have a link handy but all teams have to pay about a 6 million dollar charge for something as part of payroll.

    And you have no allowance there for benefits, etc. For example the Reds pay Social Security on all these guys.

    And yes, I think you'll find your 13 million figure will be WAY low.
    Not just Social Security. Factor in things like medical, dental, life and disability insurance. Furthermore, any smart organization is going to have costs such as workers' comp insurance, tort claims liability insurance, fidelity bonding, etc.

    And to answer the specific question about rates and limits for Social Security withholdings, I'd refer everyone to page 15 of IRS Circular E, Publication 15:

    http://www.irs.gov/pub/irs-pdf/p15.pdf

    Employers pay 6.2% and employees pay an additional 6.2% for Social Security in 2003. The income cap was $87,000.

    The Medicare rate is employers 1.45% and employees pay another 1.45%. Note that there is NO INCOME CAP on Medicare. Therefore, if you go with the calculations / estimate that the player payroll was $55,000,000, then the Reds paid almost $800,000 in Medicare payments alone in 2003 on the player payroll portion of the expense ledger.

    Fringes are a huge cost to an employer.

    If you want to know why jobs are moving to other nations, it's not just the hourly wages that must be paid - it's also the taxes & benefit costs associated with employing someone in the US of A...

  13. #42
    breath westofyou's Avatar
    Join Date
    Oct 2000
    Location
    PDX
    Posts
    42,429
    Factor in things like medical, dental, life and disability insurance. Furthermore, any smart organization is going to have costs such as workers' comp insurance, tort claims liability insurance, fidelity bonding, etc.
    Payrolls are for 40-man rosters and include averages of multiyear contracts plus $7,552,271 to cover health and pension benefits; clubs medical costs; insurance; workman's compensation, payroll, unemployment and Social Security taxes; spring training allowances; meal and tip money; All-Star game expenses; travel and moving expenses; postseason pay; and college scholarships.


    http://espn.go.com/mlb/news/2003/0721/1583823.html

  14. #43
    Where's my chair? REDREAD's Avatar
    Join Date
    Apr 2000
    Posts
    20,938
    Originally posted by 15fan
    The Medicare rate is employers 1.45% and employees pay another 1.45%. .
    Ok, I stand corrected on this. I didn't realize that employers matched Medicare.
    I knew they matched Social Security and medicare had no limit.

    The 87k figure seems a bit high as a ceiling though, unless it was just raised this
    year. I had looked up the number as recently as last year, but again, my memory
    could be failing me this year.. In any event, there's not a huge disparity here between
    your ceiling and my estimate.
    Thank you Walt and Bob for going for it in 2010-2014!

    Nov. 13, 2007: One of the greatest days in Reds history: John Allen gets the boot!

  15. #44
    You know his story Redsland's Avatar
    Join Date
    Nov 2000
    Location
    Norfolk, VA
    Posts
    7,714
    Thank you woy!

    You found the exact "payroll fee," gave me a web page to cite for it, and eliminated a LOT of math, all in one post!

    You get a gold star.

    I will add the $7MM to the payroll figure I took from Jax's site instead of using ESPN's July payroll figures, because JAX's info is more accurate.
    Makes all the routine posts.

  16. #45
    Member
    Join Date
    Mar 2002
    Posts
    1,045
    Here is a different source for administrative expenses. It is characterized differently, however, so it may include either more or less than the $13,000,000 intended:

    from MLB's disclosure to Congress


Turn Off Ads?

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •  

Board Moderators may, at their discretion and judgment, delete and/or edit any messages that violate any of the following guidelines: 1. Explicit references to alleged illegal or unlawful acts. 2. Graphic sexual descriptions. 3. Racial or ethnic slurs. 4. Use of edgy language (including masked profanity). 5. Direct personal attacks, flames, fights, trolling, baiting, name-calling, general nuisance, excessive player criticism or anything along those lines. 6. Posting spam. 7. Each person may have only one user account. It is fine to be critical here - that's what this board is for. But let's not beat a subject or a player to death, please.

Thank you, and most importantly, enjoy yourselves!


RedsZone.com is a privately owned website and is not affiliated with the Cincinnati Reds or Major League Baseball


Contact us: Boss | GIK | BCubb2003 | dabvu2498 | Gallen5862 | LexRedsFan | Plus Plus | RedlegJake | redsfan1995 | The Operator | Tommyjohn25