Jeff Passan Pissin' On The Cubs

[chibears55]

people need to realize that if the cubs farm system was given more priority with the draft, etc. over the years. they wouldn't be this horrible and you can compete with a payroll between 100-120 Mil... before this group who have they had to build on since castro came up in 2010?
their biggest prospects were brett Jackson and josh vitters.. do I need to say more?

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[nwfisch]

Jeff Passan is right. :clap:

 

[CSF77]

So debt max = 10 * income.

So 700 mil debt = 10 * income

Then income = 70 mil.

Now are we talking gross income or net.

I honestly don't understand the language of the partnership.

Basically I get that they pay out 150 mil and take on 700 mil debt and sit on it.

Out of this they control 95% of the cubs while the Trib owns 5%

Then in 7 years they can pay off the 700 mil debt.

Now few questions:

On the 700 mil loan where did that cash go? Zell have it or ?

Why did the loan company's agree to loan 700 mil with no payment for 7 years. Are they able to pay intrest fees?

Regardless the whole deal was shady and Zell smells of the ass. Ran the Trib 15 billion in debt to bankrupt it and he gets out of it. Jerk 101

 

[beckdawg]

Now few questions:

On the 700 mil loan where did that cash go? Zell have it or ?

Why did the loan company's agree to loan 700 mil with no payment for 7 years. Are they able to pay intrest fees?

Regardless the whole deal was shady and Zell smells of the ass. Ran the Trib 15 billion in debt to bankrupt it and he gets out of it. Jerk 101

I'm not proclaiming to be an expert but I'll try to answer the best I can. For the first question, I think that is the money Zell will eventually pull out when the partnership is done. For the second question, i think the the loan is actively being paid interest on by Zell like you would a car loan or whatever but the principal isn't being touched. If I understand the agreement correctly, his scheme is to pay off that as an "expense" and as such the money he takes out isn't, according to his accountants, normal income from a sale. Like I said, I'm by no means an expert here and just going off what I read.

Basically this is how I think the partnership works. Rickets put up the $150 mil as collateral for the loan. Zell then is responsible for paying for the payments on the loan for 7 years. By making those payments that some how makes his sale of the cubs non-taxable and when he pulls out after 7 years he claims that as some sort of expense vs your standard capital gains tax you'd have. After 7 years, the cubs are then responsible for the rest of the loan and instead of paying Zell, they pay the person loaning the money.

 

[SilenceS]

Well, not to be the asshole of the board but if the good ole boys would have let Mark Cuban buy the team. All of this would have been null and void.

 

[beckdawg]

Well, not to be the asshole of the board but if the good ole boys would have let Mark Cuban buy the team. All of this would have been null and void.

Maybe but I honestly think Zell would have made Cuban jump through the same hoopes because he stands to gain $300 mil in taxes he doesn't have to pay. I really don't see him agreeing to sell the team any other way unless they payed more than $300 mil + whatever the Ricketts eventually payed. I think it's sort of bullshit the way MLB gets to approve owners and pushed Cuban out but I'm not sure it changed the way the sale worked.

 

[SilenceS]

Maybe but I honestly think Zell would have made Cuban jump through the same hoopes because he stands to gain $300 mil in taxes he doesn't have to pay. I really don't see him agreeing to sell the team any other way unless they payed more than $300 mil + whatever the Ricketts eventually payed. I think it's sort of bullshit the way MLB gets to approve owners and pushed Cuban out but I'm not sure it changed the way the sale worked.

Maybe not the sale, but Cuban could never sit there and let people out due him. Ego thing.

 

[PrimeTime]

I don't recall all the details but wasn't Cuban's offer around 1 billion which would have made Zell and extra 300 mil anyways. Wasn't Zell happy with Cuban's offer but the likes of Selig and Reinsdorf and their cronies against Cuban owning a team.

 

[beckdawg]

Maybe not the sale, but Cuban could never sit there and let people out due him. Ego thing.

What do you mean by out due? If you mean having a higher payroll again, that's an issue with debt/MLB issues. Now if you mean getting shit done with the rooftop/city yeah I could see him getting that done better/faster. Overall, I think a convergence of bad things happened. The cubs at the sale time were an older "win now" team with a less than stellar farm system. You then add in a crooked ass deal with the sale, Special person issues with the city/rooftop owners, and a shift in the way the team is being run(more prospect based).

I don't really think it's the case of the Ricketts just turning into the next Jeffery Loria(Marlins owner). I think it's more of a case where they walked into a shady deal knowingly and then had some unknown issues occur that slowed them down. But what's slowed them down more is that their best prospects simply didn't work out. For example, if Jackson and Vitters had been even like Castro/Rizzo level players then the situation is quite different. You then have 4 decent young players with all of the upcoming prospects they currently have.

 

[beckdawg]

I don't recall all the details but wasn't Cuban's offer around 1 billion which would have made Zell and extra 300 mil anyways. Wasn't Zell happy with Cuban's offer but the likes of Selig and Reinsdorf and their cronies against Cuban owning a team.

I think Cuban put in the highest bid and was shot down by MLB. That being said, it's kind of impossible to say if Zell would have then continued to make him run through the leveraged partnership still even despite more money.

 

[nickofypres]

:apple:

 

[CSF77]

All water under the bridge.

But from what I gather 2016 to 17 Zell will yank out 700 mil then the Ricketts can pay off the debt.

By paying off the debt then they can add payroll due to MLB rules on income/debt.


The whole Cuban thing? Didn't happen so oh well.

All I have to say is that by then I don't want to hear excuses why they can not. This team should be running a 130 mil payroll with ease after they get the new TV deal and signs done Any BS like we can't retain x player is crap.

 

[beckdawg]

All water under the bridge.

But from what I gather 2016 to 17 Zell will yank out 700 mil then the Ricketts can pay off the debt.

Well, 2014-15 still should have room to add players. I still maintain they are legit in on Tanaka because why else would they have $105-110 mil payrolls the past 2 years only to go in with a $70 mil payroll this year? I mean if you're going to go scorched earth they could have done it 2+ years ago. And even if/after they sign Tanaka, next year they will have $14 mil from Soriano come off the books. So feasibly there's no legit reason why they can't add two top tier FAs and keep with in the payroll range of the past 2 years. In the case of Tanaka, maybe he chooses to go else where. If so, perhaps they sit on the money but as I've said else where I hope they instead find some way of getting creative with it. I still think an Either trade can make sense if the cubs are mostly eating salary for next to nothing prospect wise. For example, Villenueva for Either + minimal cash($10 mil-ish over 4 years) makes sense to me.

Another idea is Homer Bailey. He's entering the last year of his deal and the Reds are apparently looking for salary relief. At this point, I'd rather take my chances with Bailey than Tanaka. I don't know what it would take trade wise to get Bailey but he's only going to be 28 next year and I can't imagine him re-signing for more than say $20 mil/season where as some think Tanaka is $25+ mil. Or, conversely if the Reds can't find a way to lock him up he could end up a FA which would likely only cost a 2nd round pick as the cubs are likely to suck.

That's why I'm not as sold on the Tanaka or bust bandwagon as some. Sure I'd like to see the cubs get him because he helps them but I really don't like the idea of paying him more than $20 mil/year. I just think there's other viable options. Maybe it's something like the Pirates did with Burnett. Maybe the Dodgers sign Tanaka and then have to deal Beckett and/or Billingsley and the cubs can make a package deal with one of those and Either. Maybe some team goes nuts a la Detroit and is willing to give a productive player like Fister up for little more than a salary dump. Point is if you have the payroll room to work with you can do things. This may end up being especially true around the wavier trades where teams just throw a guy on waivers hoping to shed salary. Generally those guys aren't all that great but there can be good players who get moved that way.

 

[dabynsky]

So debt max = 10 * income.

So 700 mil debt = 10 * income

Then income = 70 mil.

Now are we talking gross income or net.

I honestly don't understand the language of the partnership.

Basically I get that they pay out 150 mil and take on 700 mil debt and sit on it.

Out of this they control 95% of the cubs while the Trib owns 5%

Then in 7 years they can pay off the 700 mil debt.

Now few questions:

On the 700 mil loan where did that cash go? Zell have it or ?

Why did the loan company's agree to loan 700 mil with no payment for 7 years. Are they able to pay intrest fees?

Regardless the whole deal was shady and Zell smells of the ass. Ran the Trib 15 billion in debt to bankrupt it and he gets out of it. Jerk 101

The IRS certainly thinks so and the Tribune was headed to court to settle their tax issues related to the "sale" of the Cubs and other assets under Zell.
http://www.nytimes.com/2013/06/21/business/tribunes-clever-tax-strategy-now-spells-trouble.html?pagewanted=2&_r=0

http://finance.fortune.cnn.com/2013/06/18/irs-tribune-sam-zell/

 

[dabynsky]

Jeff Passan is right. :clap:

I didn't realize you felt this way:

Not even president Theo Epstein and general manager Jed Hoyer, two of the game's great architects, could have fathomed the budgetary restrictions.

Accordingly, overspending this season, one in which the Cubs' starting lineup resembles either a really good Triple-A team or a really bad major league team, may not be the most prudent move.

The marriage of the two has led to poor attendance and angry fans, and it's entirely warranted, even though Epstein and Hoyer continue to deserve the trust of the skeptics.

Because soon, the Cubs could again be very good. No team in baseball can match its collection of hitting prospects, with Javier Baez, Kris Bryant, Albert Almora, Jorge Soler and Arismendy Alcantara. If even two or three of their current everyday players – preferably Anthony Rizzo, Starlin Castro and Welington Castillo – improve, suddenly come the kids' arrival, they're a wildly interesting team, especially should new manager Rick Renteria prove the sort of clubhouse presence the Cubs expect.

By then, the Cubs can opt out of their TV deal with WGN and start cashing in on their broadcast rights, and the renovations on Wrigley should have started, so long as they can find some sort of amicable settlement with the famous rooftops whose views the new park will restrict.

http://sports.yahoo.com/news/no--29-cubs--cheap-club-looks-like-it-s-on-verge-of-another-woeful-year-165308395.html

 

[nwfisch]

I didn't realize you felt this way:


http://sports.yahoo.com/news/no--29...n-verge-of-another-woeful-year-165308395.html

They're smart guys...but I don't know how smart they can be when they're forced to act like a small market.

I also don't know why I'd leave comfy Boston to work for a cheap owner that only cares about making a buck, when instead his focus should be on winning championships.

 

[Jntg4]

They're smart guys...but I don't know how smart they can be when they're forced to act like a small market.

I also don't know why I'd leave comfy Boston to work for a cheap owner that only cares about making a buck, when instead his focus should be on winning championships.

#TheoSpankfest

 

[dabynsky]

They're smart guys...but I don't know how smart they can be when they're forced to act like a small market.

I also don't know why I'd leave comfy Boston to work for a cheap owner that only cares about making a buck, when instead his focus should be on winning championships.

Ultimately whatever, but when you say Passan is right combined with the article being a love letter to Theo and Jed raises some questions.

 

[nwfisch]

Ultimately whatever, but when you say Passan is right combined with the article being a love letter to Theo and Jed raises some questions.

He's right about Ricketts, and we can skirt around that if we want to.

 

[dabynsky]

He's right about Ricketts, and we can skirt around that if we want to.

But that is not what you said. You said he is right, and what he is wrote is overwhelming positive about the front office of the Cubs.