LOS ANGELES — Once a model of good management, the LA Dodgers lost more money than any other team in Major League Baseball last season, according to financial information released by team owners.
Much of the league’s financial data is hidden by a confidentiality agreement among the owners. But new numbers released by owners Thursday indicate the Dodgers lost $68.9 million on revenue of $143.6 million during the 2001 season.
If the figure is accurate, it amounts to 20 percent of the league’s total 2001 losses of $344.7 million, and represents more money than the total payrolls of 14 of the other 29 teams.
Representatives of the Dodgers directed calls to Bob Starkey, an outside financial consultant, who did not immediately return calls.
The news of the overall major league losses caused owners to call once again for a cap on players’ salaries, even as it was reported that the New York Yankees were offering free agent Jason Giambi a seven-year deal for about $120 million.
However, Steve Fehr, a players union representative, said the financial data released was incomplete and open to interpretation.
During Congressional hearings Thursday examining Major League Baseball’s antitrust exemption, some members of the House Judiciary Committee expressed frustration at the incomplete financial picture given by the owners, which didn’t include such information as their own salaries and fees.
What is clear from the numbers is that the Dodgers lost more money than any other team, despite drawing 3 million fans, and that the team spent $4 of every $5 it made on player salaries.
Since News Corp. purchased the team in 1998, the Dodgers have improved revenue dramatically, to a reported $143 million this year — eighth best in the league.
But payroll expenses have risen even more.
At $116 million, the Dodger’s payroll is second only to the $118 million spent by the New York Yankees and Boston Red Sox.
“When a team spends that amount of money, you’d expect them to benefit from going to the playoffs,” said Jeffrey Phillips, a sports specialist and senior vice president at the investment banking firm Houlihan, Lokey, Howard and Zukin.
The World Series generated a total of $29 million to be split by the New York Yankees and Arizona Diamondbacks this year.
That’s money the Dodgers never got close to, Phillips said.
The Dodgers also generated broadcast rights worth only $27.3 million. While larger than that produced by most other teams, the amount falls short of the Yankees’ $56.8 million and the $31 million of the Chicago White Sox.
David Carter, principal of the Sports Business Group, a marketing and consulting firm in Los Angeles, said the Dodgers’ high payroll includes millions of dollars of deferred salaries.
Players who have retired, or have been injured or cut, are still drawing salaries even though they no longer play for the team. The situation hurts the team’s ability to put more talent on the field, he said.
The Dodgers are also hamstrung by the second oldest stadium in the National League, which doesn’t allow the same revenue generating opportunities as newer ones with state-of-the-art luxury boxes, Carter said.
In addition, the Dodger brand has been hurt by Fox’s purchase of the team from Peter O’Malley. Many fans balked at a media corporation buying the family owned team.
“The overall reverence of the team is no longer as strong,” Carter said.