Ownership and money talk from almost 52 years ago

The following is from the Sports Illustrated issue of February 29, 1960:

The year was 1950. Walter O’Malley, the cool businessman-lawyer who had just taken over as director of the Brooklyn Dodgers baseball team, cast an appraising eye on his club’s prospects. He decided they were not good. To be sure, in the next few years the Dodgers were to show the largest pretax and net-profit take in the business. Before a House subcommittee in 1957 O’Malley admitted that the Dodgers from 1952 to 1956 had made $1,860,744 after taxes.

But O’Malley knew the symptoms of business decline. His team was operating in a saturated TV market, in an outmoded place of business and under conditions which O’Malley—but few others—foresaw would deteriorate in the coming years. With a prescience given only to those destined for success, O’Malley moved the Dodgers to Los Angeles.

The results of his migration are now in. And they show that O’Malley has made more money in a single season than any other franchise holder in the history of baseball. The Los Angeles Dodgers can show a return on investment that even the most glamorous space-age stock might well envy. Moreover, there is no end in sight to his avenue of dividends.

O’Malley, of course, is not going to tell anybody how much money he has made out of his master move west. The economics of baseball traditionally have been a clandestine rite, interrupted only occasionally by the sudden sobbing of a burned board of directors. Often, such a performance is just a front-office version of the hidden-ball trick calculated to hoodwink the team’s leading hitters into signing a contract somewhat below their net worth. But even the banjo hitters are warming up for a crack at O’Malley’s bank roll after his 1959 season.

Let’s make a very conservative estimate of the Dodgers’ 1959 take. To begin with, a total of 2,071,045 paid their way into the Los Angeles Coliseum to watch the Dodgers in regular-season play. Their average ticket cost about $2.40, or a total of approximately $5 million. Concession profits gave the club an additional $384,016, and baseball novelties like hats, bats and pennants $15,000.

LOVELY RENT-FREE SERIES

The Dodgers paid no rent to the Coliseum for the World Series, O’Malley having convinced the Coliseum that the Series is historically a benefit for the players and the Commissioner of Baseball but not for the clubs. This is true except when the crowd level reaches 90,000 a day, as it did in the Coliseum. When that happens everybody makes money. The Dodgers made $335,140.16.

On the road last year Los Angeles reaped $356,094 from 1,294,889 admissions. Radio broadcasting rights brought in another $885,000, or about what the Dodgers received in Brooklyn for both radio and TV. (Nielsen, the rating people, report that the third Series game had the largest audience—24.3 million homes—ever to view a single broadcast, so O’Malley has a good argument for higher broadcasting fees in 1960.)

Thus, conservatively, O’Malley’s income from all baseball sources last year was some $7 million. In their last pennant-winning year in Brooklyn, the Dodgers took in $3,880,824.

Expenses in 1959 for the Dodgers balance out about as follows: player payroll $465,000, second highest in the league; Coliseum rental $281,282; field maintenance and crew $395,000; front-office personnel $350,000; bonuses to new rookies (an investment in the future) $850,000; loss on minor league operations $300,000; visiting teams’ share of gate $569,537; indemnification payment to the National League office and the Pacific Coast League $250,000; air transportation $110,000.

Dodger expenses for 1959 thus wound up in the area of $3,600,000. This is nearly a million and a half more than the expenses in Brooklyn in 1956, the last World Series year, when they were $2,216,175. However, Walter O’Malley and his jolly crew still had a net income before taxes of at least $3,300,000.

But the Dodgers’ and O’Malley’s windfall has not gone unnoticed in Los Angeles nor has it been universally cheered. One of the first results of the big year was that the Coliseum commission was wearing its old face when the wily Walter came forward to seek an “equitable” deal for the use of the Coliseum in 1960. The commissioners reminded O’Malley that he had signed his two-year lease with the clear understanding that should a third year be necessary he would have to sign on at the standard pre-Dodger-era rate. The Coliseum in 1960 will get 10% of the gross and all income from the concessions.

By last year’s figures, this would come to $800,000, or an increase of $500,000. To O’Malley’s credit, he put up only token resistance and quickly capitulated—even though, at 70-plus games a year, the Dodgers brought in seven times as much business at the Coliseum as football teams did.

It appears likely that the Dodgers will have the biggest National League player payroll in 1960. Gil Hodges and Duke Snider will again head the list with approximately $39,000 each. Wally Moon rises from $20,000 to $30,000. Don Drysdale goes up from $17,000 to $27,000. Charlie Neal will get $24,000, up from $19,000. Carl Furillo $25,000, Clem Labine $23,000, Jim Gilliam $22,000, and Roger Craig, $17,000, a raise doubling last year’s $8,500. Catcher John Roseboro goes from $10,000 to $16,000. Larry Sherry gets a deserved 100% raise to $14,000, and Sandy Koufax’ strikeouts merit his jump from $14,000 to $17,000. Bonus boys Frank Howard and Ron Fairly, who have already banked nearly $200,000 between them just to sign, will get standard $8,000 contracts but with provisos for premiums.

Off the field, the line is forming at the O’Malley pay window, too. Pained at the high cost of living in the Coliseum, O’Malley is more anxious than ever to complete his new stadium in Chavez Ravine. He has had to buy up at exorbitant prices 12 parcels of real estate to complete his acreage. One home site in the ravine was owned by an embittered son of a onetime British army officer. The son blamed his father’s death from a heart attack to wrangles he had had over the land. The site was appraised at $9,000. His home was sold to the Dodgers at $150,000. Another parcel appraised at $15,510 cost the Dodgers $130,000.

When these costly bases have been safely touched, Walter O’Malley, living in baronial splendor in the pseudo-alpine fastness of Lake Arrowhead, 100 miles east and 5,000 feet up from Los Angeles, will start building his $8 million ravine stadium, the ownership of which the Dodgers will share with no one.

So just how are things with the Dodgers and O’Malley? Just fine, thank you, or rather, let O’Malley thank himself. He saw the gold in the West and, superlative businessman that he is, cornered a nice solid part of it.

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58 Responses to Ownership and money talk from almost 52 years ago

  1. nellyjune says:

    Well, the Dodgers are in the mlb news almost daily now, and it has nothing to do with the players. This sale is going to be one of the biggest sports stories of 2012…..at least the first half.

  2. grizzy says:

    The nerve. Paying that stiff Koufax $17,000.

  3. lbirken says:

    Thanks for the 1960 story. I had a good laugh looking at those numbers. Seems paltry by today’s standards but no doubt someone then said the same thing then when comparing the numbers to some previous period of time. Hard to think anyone thought players were overpaid in 1960 but someone probably did.

  4. When I looked at those payroll numbers and how much was earned by which player, I could only think of what they’d be earning in today’s market. (shaking my head in wonder)

  5. 32and53fan says:

    …player payroll $465,000, second highest in the league…

  6. Vin Scully Bobblehead…

    First and only of its Kind..

    August 30th, 2012..

    I’m beyond elated to have Vinnie immortilized further and revered and put him into my growing Bobblehead collection.

  7. http://latimesblogs.latimes.com/dodgers/2012/01/bud-selig-to-get-contract-extension.html

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  8. messagebear says:

    Selig SUCKS almost as much as Frank does!!!
    If I had to choose in the middle of the ocean which one to throw a life preserver to, I’d sit on the preserver and say, “Enjoy the swim, you f***ers”.

  9. lbirken says:

    No love lost here for Bud Selig. But it should not be surprising MLB would renew his contract. Remember, he represents the owners and no one else and he has helped drive a lot of revenue to those same owners. They have no reason to want to replace him. Dodger fans, on the other hand, have reason enough to say goodby to Mr. Selig.

  10. selltheteam says:

    One more group throws their hat into the potential ownership ring…
    http://www.latimes.com/sports/la-sp-dodgers-disney-20120108,0,6490325.story

    Family of Roy Disney.

    • Love Disney Love Dodgers! I wonder how come they didn’t buy the Angels??? I don’t know about this one, next thing we know they move the Dodgers to Anaheim and Angels to L.A. But if it’s a good thing for the team and just as long they stay in L.A. then I’m fine with it.

      Those this mean there is going to be a bunch of employees telling me where to park? (love that from Disneyland) And heck do we get a tram from the parking to the front of the park?

      So if they win the World Series they are REALLY going to Disneyland! I’m still TEAM CUBAN but TEAM DISNEY sounds good!

      So as a fan, do we get a SoCal promotion where we pay for one day and come back another day for FREE!

      If we pay for hoppers, can we hop around sections to section?

      Are we getting Disney characters running around the stadium?

  11. Nellyjune says:

    Blake Hawksworth is having minor othroscopic elbow surgery tomorrow to remove scar tissue. He’s expected to be just fine in about 4-6 weeks, just in time for spring training 🙂

  12. JhallWally says:

    Initial bids due by Jan 23rd.

    Winning bid submitted to court by April 1st.

    Team sold by April 30th.

    Nedcompoop fired by _______.

    Just 91 days till we get a new owner. Hallelujah!!!

    How long until Nedcompoop is fired?

    • nellyjune says:

      I am thinking two weeks after the new owners take over. That gives them just enough time to let Ned give them all the details of his idiotness, and then they will be done with him. However, if the owner is Torre’s group, perhaps the next day. As much as I wasn’t a Torre fan, he never got the players he wanted….pitching in particular, and Ned always managed to find him crap.

  13. JhallWally says:

    Can’t help but wonder how long it will be until Jamie the skank and her lawyers feel like they got short changed and try to renege on the divorce settlement.

    • I’d imagine about 30 seconds after she hears how much Frank is going to be getting.

      Never underestimate a billionaire’s stupidity and one- upsmanship when it comes to screwing the next billionaire out of something.

  14. trublu4ever says:

    I can’t wait until the day we are McCrook & Skank free!

  15. nellyjune says:

    I know I watch way too much “Storage Wars”, but this sale certainly has that feel to it in some ways.

  16. Dodger4life says:

    See what I mean…
    .

    Happy New Year All…I have been refreshing my page here since, New Years…Only to see no activity. Finally today, I stumbled onto this post…( It’s been a while )
    .
    I am still a little weary (understatement) of Franks intentions…It just seems that the higher the price becomes, the more options will be available to him…I do hope for the best however…As always I enjoy the comments…Peace and Go Dodgers!

    • The interesting thing is that with all these groups involved, and the comodity being the Los Angeles Dodgers, one will drive up each other, and after the initial bids come in, a 2nd round will enter, and from there, we will be able to see who is real and who doesn’t stack up. Some will bow out, but I’m guessing that at least one group will merge with another in order to make their group, and bid more substantiative.

      At the beginning of all this, Frank McCourt said he expects somewhere between $1.2 to $1.5 billion for the team and assets alike, but with this type of bidding, it could very well top $2 billion, and Frank knows it. He planned this type of auction just for the case of having a 2nd round. And that’s what its coming to.

      Now with the like of having FOX drop their objections, Frank can add that to a process and ask for more, with the assumption that whoever does end up winning the bid, gets a new contract with TV rights etc.

      The lone problem is the fact that up till now, we still don’t know what Frank is exactly “SELLING”. The team, stadium, tickets, food, etc. So far, I’ve heard that he’s keeping the parking lots, and for that lone reason, I would not bid. The parking lots and sorrounding area are the most attractive part of the deal.

      With those components, parking lots, shops, housing, etc can be built, and Frank still reap the rewards.

      Selig is no good when it comes to negotiating, and Frank has shown his deficiencies.

      With the land and such related to Dodgers, including Jet, and etc., I fully expect Frank to get at least $2 billion.

      But with that in mind, a lot of people related to baseball circles, etc., whatever that means, say that the best Frank can do right now, besides selling, is speak with all potential owners and, in a way, sign Prince Fielder with their money, so they won’t have to wait till July to trade for someone.

      Maybe, in a way, leave with some dignity in hand.

      To be blunt, Frank was not a horrible owner. He was ill-equipped to be the owner of such a respectable franchise, but he did start off right. Playoffs, and near World Series’ appearances 2x. Manny etc. The only wrong was Ned and his dumb trades. But all in all, his unraveling came to a head because his lifestyle eroded money. Then the greed and everything etc. Ticket, parking, food increases, and then his proposal to update Dodger stadium, only to say that he had no money to do so.

      I know that my opinion is a little different from others on here, but take into account the success this team had, and you can reach the same conclussion.

      In the end, its a decade of turmoil and unrest, but 5-6 years of success within it. Very different from the Fox years.

      Hopefully, with a new stewardship, these things can be changed, and a prosperous growth for this team can begin.

      Now, onto wait and see how much this franchise is worth: well above the $800 mil that Forbes presummed it as. Ha! A bussiness magazine trying to tell people what a franchise is truly worth.

      Only we know what its worth, and its in more than just money.

  17. Dodger4life says:

    Just the fact that MLB, threatened to throw the Greatest Organization in All of Baseball…Out of the league….speaks volumes!

  18. Dodger4life says:

    Factor that in with O’Malley’s warning against bidding to much…

  19. Dodger4life says:

    Buds, 2 year extension…

  20. Dodger4life says:

    Good Hands…( My ***)! I’ll turn it over to Bear and E now!! Blue Peace, Y’all…

  21. Dodger4life says:

    I’m optimistic…In the fact that… “The Faithful”,… won’t let our Boy’s be short changed…ONE RED CENT!!

  22. selltheteam says:

    Yunghitters89 – Don’t worry about having a different opinion. If we all espoused the same opinion, this would be a very dull board.

  23. I wouldn’t be a bit surprise if McCourt is waiting for some of the bidders to make a SEPARATE bid for the parking lot.

  24. lbirken says:

    Yung, I agree with much of what you said. Things started o.k. with the McCourts but their lack of character got the best of them.

  25. messagebear says:

    Maybe once we get the new ownership installed, Dodgers ought to have a “panties day” promotion to celebrate Jamie’s dropping hers and starting the whole thing unraveling.

  26. messagebear says:

    O.K., who’s got the picture of the two sisters of that relief pitcher of ours? For some reason that comes to mind.

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