Don't expect increase in payroll

[drjim]

I really feel that what St Peter said was stupid. He should be saying something like we'll do what we need to in order to field a better team (even if he didn't mean spend more money). There was no reason, at this time, for him to already semi-limit the payroll number like he did.

 

He should go back to the PR dept and they should bring in a baseball guy to run the team, imo.

 

I agree with all of this and especially the bolded part. That said, I do wonder if we are reading a little too much into a throwaway question in the broader question of Gardy being fired. But he would have been much wiser to sidestep the question.

[ashbury]

He should go back to the PR dept

Why do you believe that?  You just demonstrated you think he's terrible at it.

 

_{^{/ or you think he just demonstrated he's terrible at it.}}

[HitInAPinch]

Dave St. Peter, forgot all about him.  He's gotta go, too :shoot:

[Winston Smith]

Ash,  just reassigning him we don't like to fire people you  know!

[jay]

Unfortunately we know math.

 

I know math, too.  Thanks.

 

I don't know the inner workings of how the Twins calculate their revenues and set budgets across their operation, even with some articles that try to make an educated guess at what the revenues are. 

 

Trying to derive what I think their payroll should be based off a quote and the limited information we have is an exercise in futility.  Trying to convince other people that number is right is somewhere further past that.

[tobi0040]

I know math, too.  Thanks.

 

I don't know the inner workings of how the Twins calculate their revenues and set budgets across their operation, even with some articles that try to make an educated guess at what the revenues are. 

 

Trying to derive what I think their payroll should be based off a quote and the limited information we have is an exercise in futility.  Trying to convince other people that number is right is somewhere further past that.

 

the math comment was aimed at the Twins.  Not at you.

[jay]

the math comment was aimed at the Twins.  Not at you.

 

The concrete concepts of math and the abstract concepts of finance/accounting should not be confused with each other.  10 different finance experts will get you 10 different numbers.

 

Surely, despite public quotes that simplify it, it's not as simple as .5*(previous or current year gross revenues).

[LaBombo]

Jim Pohlad NEVER SAID that payroll would be around 52% each and every year. In fact it originally surfaced in a discussion about guidelines. While poorly articulated, there has never been a promise. Find me something along the lines of " hey, if you build me a stadium, I'll spend 52% of revenues on payroll every year". You don't have to believe me, but I can share with you that, from two personal conversations I've had with more than one person who can make a decision like this, the intention was and is 1) to pay attention to and adhere to industry standards regarding payroll expenditures, and 2) to spend, ON AVERAGE, around 52% of revenues on payroll.

 

So, no, Winston, I don't think you've been misled.

From a preseason 2010 article - "Pohlad said Target Field revenues should allow the Twins' payroll to remain in the $95 million range beyond this season."

 

95 million or 52%, take your pick. The Twins dug this hole for themselves by making predictions sound as much like promises as they possibly could without technically obligating themselves, and then making those predictions not become reality.

 

And now they've kicked off the run-up to the 2015 season by saying they'll probably keep trying to get out of the hole by continuing to dig.  It's confusing to me that you don't see this as cause for consternation, or at least disappointment.

[TheLeviathan]

I know math, too.  Thanks.

 

I don't know the inner workings of how the Twins calculate their revenues and set budgets across their operation, even with some articles that try to make an educated guess at what the revenues are. 

 

Trying to derive what I think their payroll should be based off a quote and the limited information we have is an exercise in futility.  Trying to convince other people that number is right is somewhere further past that.

 

Basically you're justifying teams cooking their books to keep promises.  I think reasonable estimations can be made and those reasonable estimations don't match the promises.

 

They don't always have to for me, but consistently NOT making that level is a problem in my eyes.  It's even worse when one playoff game has been played and you're already trying to sell the public on a payroll decrease.

[tobi0040]

From a preseason 2010 article - "Pohlad said Target Field revenues should allow the Twins' payroll to remain in the $95 million range beyond this season."

 

95 million or 52%, take your pick. The Twins dug this hole for themselves by making predictions sound as much like promises as they possibly could without technically obligating themselves, and then making those predictions not become reality.

 

And now they've kicked off the run-up to the 2015 season by saying they'll probably keep trying to get out of the hole by continuing to dig.  It's confusing to me that you don't see this as cause for consternation, or at least disappointment.

 

The maddening thing is that I believe if the Twins communicated a rebuild in 2011/2012 people would not be so irritated.  And we would not need to be appeased by signings like Pelfrey, which would have also helped the future

[jay]

If we believe in the 50-52% and we also believe the Twins will have a harder time selling tickets next year, why would we expect payroll to increase?

[tobi0040]

If we believe in the 50-52% and we also believe the Twins will have a harder time selling tickets next year, why would we expect payroll to increase?

 

They are going to have a tough time selling tickets because the year prior they were bad in part because they had payroll at 35%.

 

If payroll was at 50% this year, they would have had another $30M in payroll and happier fans.

[jay]

Basically you're justifying teams cooking their books to keep promises.  I think reasonable estimations can be made and those reasonable estimations don't match the promises.

 

They don't always have to for me, but consistently NOT making that level is a problem in my eyes.  It's even worse when one playoff game has been played and you're already trying to sell the public on a payroll decrease.

 

We fundamentally won't ever see eye-to-eye on how to use quotes and the limited information available to us on the internet.  We've mutually established that in the past.

 

Do I think revenue estimates can be accurate within the 10's of millions?  Sure, but that leaves a lot of room for error and interpretation.  Compound that with the fact that we don't and won't ever know how the Twins adjust that number -- budgetary periods, revenue sharing, variations in amateur acquisition costs, etc, etc, etc -- and I fail to see where this fan analysis can give us an accurate number.

[USAFChief]

If we believe in the 50-52% and we also believe the Twins will have a harder time selling tickets next year, why would we expect payroll to increase?

Because if we believe in 52% then we believe there's a lot of unspent percent laying around from the last three years.

[USAFChief]

We fundamentally won't ever see eye-to-eye on how to use quotes and the limited information available to us on the internet.  We've mutually established that in the past.

 

Do I think revenue estimates can be accurate within the 10's of millions?  Sure, but that leaves a lot of room for error and interpretation.  Compound that with the fact that we don't and won't ever know how the Twins adjust that number -- budgetary periods, revenue sharing, variations in amateur acquisition costs, etc, etc, etc -- and I fail to see where this fan analysis can give us an accurate number.

Would you agree the Twins set themselves up for this kind of backlash through their own statements?

[tobi0040]

We fundamentally won't ever see eye-to-eye on how to use quotes and the limited information available to us on the internet.  We've mutually established that in the past.

 

Do I think revenue estimates can be accurate within the 10's of millions?  Sure, but that leaves a lot of room for error and interpretation.  Compound that with the fact that we don't and won't ever know how the Twins adjust that number -- budgetary periods, revenue sharing, variations in amateur acquisition costs, etc, etc, etc -- and I fail to see where this fan analysis can give us an accurate number.

 

The fact that the number can shift a little year over year does not mean that payroll at 35% is OK, when they said it would be at 50-52%.  Or they said it would remain above 95M and it hasn't.

 

If they acknowledged a rebuild that is another thing, but they never verbally said it or frankly acted like it.

[jay]

Because if we believe in 52% then we believe there's a lot of unspent percent laying around from the last three years.

 

If you believe in rollover dollars, do you believe there's ever been a payroll that exceed 52%?  What's the exact timeframe in which any rollover dollars, either excess or shortage, have to be spent or recovered?

[Boom Boom]

I think it's clear that DSP's payroll % estimation quote was something he should have never said.  It would keep the fans from bludgeoning him with it if he admitted that it was a shot in the dark, or at least a short-run estimation that has little to do with where the team is at now.  I never really interpreted it as a promise, and that was what, five, six years ago?  

[tobi0040]

If you believe in rollover dollars, do you believe there's ever been a payroll that exceed 52%?  What's the exact timeframe in which any rollover dollars, either excess or shortage, have to be spent or recovered?

 

It could be documented quite easily that far more money has been left on the table than overspent.  In 2010 we went up to 110M I believe, which was 51% of revenue.  No overages here. 

[USAFChief]

If you believe in rollover dollars, do you believe there's ever been a payroll that exceed 52%?  What's the exact timeframe in which any rollover dollars, either excess or shortage, have to be spent or recovered?

I admit, I don't know what timeframe is reasonable. If in a couple years they're knocking on the WS door and they go out and spend like drunken airmen, I'll post multiple mea culpa's and sing hosannas. Deal?

[jay]

It could be documented quite easily that far more money has been left on the table than overspent.  In 2010 we went up to 110M I believe, which was 51% of revenue.  No overages here. 

 

Documented based on an unverifiable Forbes number * .52?  It can't possibly be that simple.  Even the Forbes numbers have a footnote... "2. Net of stadium revenues used for debt payments."  What other footnotes, revenues, costs or adjustments might exist?

 

Sorry, but sound financial analysis requires a lot more information in my eyes.

[jay]

I admit, I don't know what timeframe is reasonable. If in a couple years they're knocking on the WS door and they go out and spend like drunken airmen, I'll post multiple mea culpa's and sing hosannas. Deal?

 

I'd love to take that deal, but even Yankees fans don't think their team spends enough payroll.  It's an area that is impossible to appease all.

 

You're absolutely right that the Twins haven't helped themselves through their various statements.

[USAFChief]

Documented based on an unverifiable Forbes number * .52?  It can't possibly be that simple.  Even the Forbes numbers have a footnote... "2. Net of stadium revenues used for debt payments."  What other footnotes, revenues, costs or adjustments might exist?

 

Sorry, but sound financial analysis requires a lot more information in my eyes.

Would it be fair to say, based on examples like Detroit, that some teams in similar situations chose to put payroll concerns at a lower priority?

[tobi0040]

Documented based on an unverifiable Forbes number * .52?  It can't possibly be that simple.  Even the Forbes numbers have a footnote... "2. Net of stadium revenues used for debt payments."  What other footnotes, revenues, costs or adjustments might exist?

 

Sorry, but sound financial analysis requires a lot more information in my eyes.

maybe you have some year over year shifts. Maybe smaller or bigger than normal expenses in a certain category. But the point remains. You could adjust the Forbes revenue number down 10 percent (20 million) and payroll would still be short about 20 million from the twins stated number. I don't think sound financial analysis is required nor should a poster be required to explain what they think the twins policy should be regarding rollover costs.

 

This is noise. Absolutely nothing wrong with holding them accountable to their own statements

[drjim]

The maddening thing is that I believe if the Twins communicated a rebuild in 2011/2012 people would not be so irritated.  And we would not need to be appeased by signings like Pelfrey, which would have also helped the future

 

I highly, highly doubt this. All we would have heard is "two years into a new stadium and we are doing a rebuild and cutting payroll!" It would have made no difference. Wins are all that matter.

 

Since a large chunk of savvy fans here are more caught up with parsing quotes instead of focusing on the big picture moves that are happening right in front of their faces, I would have much less confidence for the less savvy fans.

[drjim]

They are going to have a tough time selling tickets because the year prior they were bad in part because they had payroll at 35%.

 

If payroll was at 50% this year, they would have had another $30M in payroll and happier fans.

 

Unless there was a significant difference in W-L I don't believe your second line at all. Fans don't care about payroll, they care about record.

[drjim]

Would you agree the Twins set themselves up for this kind of backlash through their own statements?

 

I would say the backlash is entirely through sucking. Getting hung up on payroll and parsing quotes is a projection of that.

[LaBombo]

If we believe in the 50-52% and we also believe the Twins will have a harder time selling tickets next year, why would we expect payroll to increase?

They've already proved they're willing to spend less when the situation calls for it, which should indicate a willingness to spend more when the situation calls for it.

[USAFChief]

I highly, highly doubt this. All we would have heard is "two years into a new stadium and we are doing a rebuild and cutting payroll!" It would have made no difference. Wins are all that matter.

 

Since a large chunk of savvy fans here are more caught up with parsing quotes instead of focusing on the big picture moves that are happening right in front of their faces, I would have much less confidence for the less savvy fans.

I view payroll as a "big picture" item.

[diehardtwinsfan]

I think payroll is a big picture item. I also think it's a context specific item. There's a time to bump it up, and there's a time where it makes little sense. The danger as I see it is that when it becomes a mandate, you see real large contracts given to guys who have no business getting them. I'd add that some here seem to be arguing for said mandate, even though Pohlad was clear that this was a guideline.

 

I'm all for spending where it makes sense, but given the FAs out there this season, the only one I'd probably spend big cash on is Scherzer, and I suspect I'd balk long before he gets the deal he ends up signing. When the team starts spending to a mandate, they end up with a lot of contracts that they cannot easily shed, and likely at a time when the kids have established themselves. I think I've made my recommendation clear in other threads, I'd probably go out and get Kemp, who can be had for his salary and nothing in prospects. He's overpaid, but a pretty decent bet to maintain above average production in LF for the remainder of his deal. This won't put the team anywhere near the 52%. Heck, it won't even push them above 90M. Seems like there's plenty of middle ground here.