Red Sox owners sit atop a $6.6 billion sports conglomerate

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Forbes today did a ranking of sports conglomerates (i.e. sports businesses’ total value, including all properties). The top group with a baseball team is the Fenway Sports Group — owners of the Boston Red Sox, Liverpool FC, and other ventures — which is worth a total of $6.6 billion. That’s third behind the Kroenke Sports, worth $8.4 billion, and Cowboys’ owner Jerry Jones’s empire, set at $6.9 billion.

Fenway Sports Group — owned by Sox owner John Henry — started with a $700 million purchase of the Red Sox and built from there. It’s fair to say, then, that the Sox were the first and primary driver that led to an 843% return on their investment, allowing them to bring in the NESN Network, Liverpool FC, NASCAR’s Roush Racing and the Fenway Sports Management company.

That’s pretty great for them. It also makes one wonder why it’s, apparently, so important for the Red Sox to get beneath baseball’s Competitive Balance Tax threshold, as they’ve said they need to do, which could possibly lead them to trade Mookie Betts. Their CBT tax penalty for this past year was reported yesterday to be $13.4 million. That’s rounding error for FSG.

The response I usually get to such assertions is that overall business value is unrelated to cash flow and payrolls and that it’s not fair to assume a team with a huge value should spend big. Which is silly of course.

If I own a house and it doubles in value — or, like the Sox’ owners’ investment, increases in value over eight-fold — I have enormous financial resources at my disposal. I have the ability to borrow against or spend against that value to make improvements in my home. I can renovate my kitchen and stuff. Indeed, I should, because I want to maintain or even increase that value. Just as the FSG’s owners used Red Sox money to get into the English Premiere League or the TV business, sometimes it makes sense to use money from the other buckets to keep the Red Sox running well. It’d be silly not to.

Except they’re apparently not. They feel obligated to avoid future CBT penalties because . . . they just want to? Because that’s what other baseball owners expect of them? I don’t know.

But I do know that there is nothing requiring them to do it. It’s not a hard salary cap. They can afford the penalties. They can afford almost anything given the state of their business. But no. Why?

New bill to build Athletics stadium on Las Vegas Strip caps Nevada’s cost at $380 million

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CARSON CITY, Nev. — A bill introduced in the Nevada Legislature would give the Oakland Athletics up to $380 million for a potential 30,000 seat, $1.5 billion retractable roof stadium on the Las Vegas Strip.

The bulk of the public funding would come from $180 million in transferable tax credits from the state and $120 million in county bonds, which can vary based on interest rate returns. Clark County also would contribute $25 million in credit toward infrastructure costs.

The A’s have been looking for a home to replace Oakland Coliseum, where the team has played since arriving from Kansas City for the 1968 season. The team had sought to build a stadium in Fremont, San Jose and finally the Oakland waterfront, all ideas that never materialized.

The plan in the Nevada Legislature won’t directly raise taxes. It can move forward with a simply majority vote in the Senate and Assembly. Lawmakers have a little more than a week to consider the proposal before they adjourn June 5, though it could be voted on if a special session is called.

The Athletics have agreed to use land on the southern end of the Las Vegas Strip, where the Tropicana Las Vegas casino resort sits. Oakland Mayor Sheng Thao has said he is disappointed the team didn’t negotiate with Oakland as a “true partner.”

Las Vegas would be the fourth home for a franchise that started as the Philadelphia Athletics from 1901-54. It would become the smallest TV market in Major League Baseball and the smallest market to be home to three major professional sports franchises.

The team and Las Vegas are hoping to draw from the nearly 40 million tourists who visit the city annually to help fill the stadium. The 30,000-seat capacity would make it the smallest MLB stadium.

MLB Commissioner Rob Manfred said a vote on the Oakland Athletics’ prospective move to Las Vegas could take place when owners meet June 13-15 in New York.

The plan faces an uncertain path in the Nevada Legislature. Democratic leaders said financing bills, including for the A’s, may not go through if Republican Gov. Joe Lombardo vetoes the five budget bills, which he has threatened to do as many of his priorities have stalled or faded in the Democratic-controlled Legislature.

Under the bill, the Clark County Board of Commissioners would create a homelessness prevention and assistance fund along the stadium’s area in coordination with MLB and the Nevada Resort Association. There, they would manage funds for services, including emergency rental and utility assistance, job training, rehabilitation and counseling services for people experiencing or at risk of homelessness.

The lease agreement with the Las Vegas Stadium Authority would be up for renewal after 30 years.

Nevada’s legislative leadership is reviewing the proposal, Democratic state Assembly Speaker Steve Yeager said in a statement.

“No commitment will be made until we have both evaluated the official proposal and received input from interested parties, including impacted community members,” Yeager said.