Imagining a fan-owned team

Last week, I wrote an article getting mad at a mostly inconsequential but deeply frustrating decision made by the Los Angeles Angels. The lesson I took from that, and from past instances of mismanagement and money-grubbing by Arte Moreno, was that baseball owners are an unnecessary and damaging feature of modern baseball. The only qualification required to become an owner is being incredibly rich, and the experiences that such an ultra-wealthy person has in their life make them poorly qualified to run a baseball team with a focus on long-term success rather than short-term profit.

Baseball owners are a scourge on the sport

Rick Scuteri-USA TODAY Sports

The skills that enable you to make enough money to buy a baseball team are not the same skills that make you a worthy proprietor of said baseball team. So why are rich people the only ones who get to run baseball teams?

Because that conclusion is objectively correct, and because everyone loved the idea (note: don’t try to confirm that statement by checking the comments on the piece), individual ownership is surely on the way out in the near future. So that raises the question: what will the alternative look like? If we really do want to move away from the ultra-rich-guy model of baseball ownership, what can we move toward?

Luckily, we aren’t operating in completely undefined territory when asking that question. I am not the first person to have this idea; the very excellent Dave Zirin wrote a piece back in 2011 advocating for collective ownership of the Dodgers after MLB stripped the franchise from the McCourts. And as he noted there, this is not a novel phenomenon in a number of other sports leagues.

The example American fans are probably most familiar with is that of the Green Bay Packers, who are owned by 360,000 individual fans. No one can own more than a few percent of the total outstanding stock, keeping any one person from gaining control over the team. The stock doesn’t pay dividends, but instead entitles the owner to voting rights, used mainly to determine who will be on the Board of Directors and to set some big-picture strategy for the team (such as whether or not to create and sell more shares in order to raise money for a new stadium, as the Packers did back in 2011).

But if we go beyond America, the practice is more widespread, and enables finer control of the team by the fans and shareholders. Real Madrid and F.C. Barcelona, two top international soccer teams, are both fan-owned, though in a different way than the Packers. Rather than buying stock, fans can purchase “membership” in the team, entitling them both to season tickets and to voting rights. The members (known as socios, or “partners”) select a smaller number of representatives, who then govern the team directly. These club members cannot invest their own money into the team, and any spending must come from revenues earned.

If we’re trying to move away from ownership structures where money is what matters (and we are), these European set-ups have a lot of advantages of that of the Packers. While members still have to pay a not-insignificant annual fee, everyone who pays the fee is on the same footing. Unlike the Packers, someone can’t gain more control by sinking more of their money into ownership.

Photo by David Ramos/Getty Images

Regardless of the precise details, all three franchises are examples of how successful fan-ownership can be. The main distinction between these teams and traditional, solo-ownership teams is not in their management; there’s no instant-voting from couches across Wisconsin on what play to run, or from millions of Catalonian porches on who to start at midfielder. Like most individuals who own sports teams, these collective owners select a management group, who in turn hire staff and coaches, and let them deal with the details of the team.

What these teams do differently is make long-term decisions with the best interests of the entire fanbase in mind. There’s a reason that, while other NFL teams are fleeing their homes for Los Angeles and hoping to capture some of that city’s massive population, or threatening to do so in order to extort more money out of their home city, the Packers are permanently grounded in the smallest market in the league. It’s the big-picture decisions — whether to hire new management, to build a new stadium, to change cities — that fan-owned teams make differently.

But, to return to the exact topic of last week’s article, I suspect there’s a difference in the narrower decisions that are made as well. Under none of these structures would Angels fans be voting on whether to start Bud Norris or Jesse Chavez. But the person making the decision — Mike Scioscia, or Billy Eppler, or whomever — would be making it knowing that his bosses (all several hundred thousand of them) are evaluating him not on his ability to extract cash value from the team, but on his ability to create a successful franchise in both the short- and long-term. The tone that prevails in a fan-owned organization is undoubtedly different than in an Arte Moreno-owned organization.

Richard Mackson-USA TODAY Sports

The ownership structures of the Packers and F.C. Barcelona and Real Madrid (and any number of other non-American sports teams) are just examples, however. MLB has intervened to prevent fan-ownership before: when Padres owner (and McDonald’s founder) Ray Kroc died, his wife, Joan Kroc, tried to transfer ownership of the team to the city of San Diego. That’s not to say that a move to public ownership isn’t possible, but that it would require major changes to MLB. We’re already way out in speculative territory here; why restrict ourselves to what exists elsewhere? If we were working from scratch, what would the ideal set-up be?

My issue with the examples described above is that they still require fans to sink money into the team, and thus still limit ownership to people with substantial disposable income. Granted, it’s a much, much less restrictive limit than what currently exists — a few hundred dollars a year, rather than several hundred million — but no amount of disposable income makes someone more or less qualified to be an owner of an MLB team.

So what I propose is truly public ownership, through local government. Rather than getting fleeced into paying for a new stadium and getting nothing in exchange, a city, state, or even a collection of states could sink that money into the purchase of an MLB franchise. All voters in the geographic unit would then have a voice in the management of the team, in the same way they have a voice in the management of the local schools, libraries, and other important public institutions.

Cities could agree on different baseline distributions of team revenue. A city might finance the purchase by issuing a ten-year bond — basically borrowing the money — and spend the first ten years taking, say, 15 percent of team revenues to pay off those bonds. After ten years, that 15 percent of revenue could go toward some deserving city project that the voters chose: arts classes in local schools, or a new water supply in a underserviced neighborhood, or even a one-time dividend paid out to every resident. (That’s right: a baseball team-financed universal basic income. It could happen!)

And the year-to-year management of the team would likely look different as well. To continue with this bond-financed hypothetical, the voters could choose between different possible distributions of the remaining 85 percent of team revenue. But whatever they chose, that revenue would stay with the team, and not vanish into a greedy owner’s pocket. If the team’s management decided to start a rebuild, and run a lower payroll for several years, those savings would have to be reinvested into the team in some form. The voters could decide whether that meant some improvements to the stadium, or higher payrolls a few years down the line. Importantly, what it can’t mean is a new yacht for some rich jerk.

This may or may not be the best way to implement public ownership of baseball teams. I’m pretty confident, however, that it’s better than what we currently have.

Troy Taormina-USA TODAY Sports

What I hope is that people think critically and creatively about how they want their society to be run, including but not limited to their local baseball teams. The prevailing rule is that more money means more power. It has not always been that way; it need not always be that way. We can and should do things differently. Fan ownership of MLB franchises is not the most important method by which we can abrogate capitalism, but it would definitely be a good way.

Henry Druschel is the co-Managing Editor at Beyond the Box Score. You can find him on Twitter at @henrydruschel.