Dodgers’ $300 Million Payroll Not That Crazy
Back before the 2012 season, Frank McCourt owned the Los Angeles Dodgers. He had purchased the team in 2004, inheriting a club that featured a $105 million payroll in 2003. Nearly ten years later, he sold the team to the deep-pocketed Guggenheim-led group — handing over a club that also featured a $105 million payroll. Major League Baseball revenues had doubled during McCourt’s tenure as team owner — and salaries for players increased at something close to the same rate — but the Dodgers, sitting in one of the biggest media markets in the country, stuck to the status quo after fielding one of the bigger payrolls in baseball at the beginning of the century. The Dodgers have finally caught up with the times (some would say surpassed) in terms of payroll, but while their $300-plus million payroll might seem enormous, the team would still be right in line with the New York Yankees and Boston Red Sox if those two teams had not slowed their spending in recent years.
Prior to the arrival of the Dodgers’ new ownership and $8 billion cable deal, the Yankees were the only team to exceed a $200 million payroll. The Yankees crossed that threshold in 2005, but kept their spending fairly static over the following decade, only getting above $225 million once (in 2013) and falling below that mark last season. Their total outlay on players was often somewhat higher, given the luxury-tax payments the team was forced to make every season. Given the Yankees’ spending over the last decade and the Dodgers’ spending over the last few seasons, it might appear that the luxury tax is not much of a deterrent towards spending, but as Nathaniel Grow detailed back in May, the luxury tax has kept spending down at upper levels.
