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Just How Cheap are the Tampa Bay Rays?

ST. PETERSBURG, FL - OCTOBER 1: Manager Kevin Cash of the Tampa Bay Rays watches the action during the first inning of the game against the Baltimore Orioles at Tropicana Field on October 1, 2017 in St. Petersburg, Florida. (Photo by Joseph Garnett Jr./Getty Images)
ST. PETERSBURG, FL - OCTOBER 1: Manager Kevin Cash of the Tampa Bay Rays watches the action during the first inning of the game against the Baltimore Orioles at Tropicana Field on October 1, 2017 in St. Petersburg, Florida. (Photo by Joseph Garnett Jr./Getty Images)
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HOUSTON, TEXAS – OCTOBER 10: A fan hold a sign prior to game five of the American League Division Series between the Tampa Bay Rays and the Houston Astros at Minute Maid Park on October 10, 2019 in Houston, Texas. (Photo by Tim Warner/Getty Images)
HOUSTON, TEXAS – OCTOBER 10: A fan hold a sign prior to game five of the American League Division Series between the Tampa Bay Rays and the Houston Astros at Minute Maid Park on October 10, 2019 in Houston, Texas. (Photo by Tim Warner/Getty Images)

So are we stuck here?

Since spending $80MM+ on the 2017 Major League payroll, that number has fallen roughly $20MM, what gives? This is where it gets really murky.  Principal owner, Stu Sternberg, stated in an interview with the Tampa Bay Times in April of 2017, that the Rays ownership group has done nothing but lose money on the Rays.

"“We have lost money from every point in time you can pick”"

What does that mean? We will truly have no idea since the Rays are privately held. It could mean they are operating at a loss every year. It could mean the members of the ownership group like to use cash to play an Easter egg hunt sort of game, and some of the cash is hidden so well around the office that it is never to be found. It certainly does not mean they have lost equity, as the value of the Rays has grown from $200 million when Sternberg purchased the team in 2004, to roughly $1 billion today.

We don’t know exactly what is meant regarding his statements about losing money, but we do know that the MLBPA and Major League Baseball have an expectation that about 50% of revenue is spent on payroll and it looks like the Rays came up a little (A LOT) short last season.

Revenue was up to $228 million in 2018 and Forbes has their player expenses at $104 million with an operating income of $27 million. According to those numbers, the Rays payroll/revenue ratio was 45.6% in 2018…which means it was even lower in 2019.

Revenue has increased at the following rates:

2015-2016: 6.2%

2106-2017: 6.8%

2017-2018: 4.1%

This year there should have been an increase in TV revenue, so let’s just be nice and project a 6% increase in revenue for the Rays in 2019. This puts their revenue at $241.68 million. According to Spotrac their total payroll expenses (including minor leagues, IL, and benefits) came in at $89.9 million.

That would be a 37% ratio. Now the numbers are more in line with the misleading tweet from 2017. The Rays’ Major League payroll opened the 2019 season with $52 million. The revenue is going up and the payroll is going down. If the Rays keep a similar payroll as last season, total payroll expenses will only make up about 40% of their budget. 

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