Article: VIDEO: Dave St. Peter Answers Your Questions

[Otto von Ballpark]

In terms of payroll and spending, I don't know what more you want from the front office. We're never going to get everything. In multiple conversations with different people within the organization, I don't have any reason to believe they are lying/misleading anyone. 

I don't think they are lying/misleading either, but I still think they are working from a very different definitional foundation.  Like back in the stadium debate days, I am pretty sure that "breaking even" and "making money" frequently became "losing money."  It was nice to hear St. Peter clarify the definition of "player payroll" but in retrospect I suppose that should have been assumed, given the published nature of player salaries and context of those discussions.

 

I'd be more interested in their definition of "revenue" in that equation.  Does it fully include everything (local/team revenues, shared league revenues, possible revenue sharing)?  Gross or net -- is anything deducted or depreciated off the top there, before they look at their 52% payroll target?  Taxes?  Construction costs?  Loan interest/payments?  Revenue sharing?  They own their own radio station -- how does that figure in?  I know for revenue sharing purposes, MLB won't let him shift or deduct things anymore, but for their own internal calculations and considerations, it's quite possible that the Twins do.

 

Heck, just what IS their revenue?  If 50-52% player payroll is standard and they've been meeting or exceeding that figure regularly, what's the harm in disclosing how the Bloomberg and Forbes revenue estimates are way off base?  (Consider it a courtesy to the Bloomberg and Forbes folks. )  I know Bloomberg specifically contacted MLB teams for comment and information, and some responded -- did the Twins provide any?  Maybe the estimates are wrong for this market?  Maybe the Twins are under-performing the market from a revenue standpoint?

 

I did post ashburyjohn's revenue question in the suggestion thread, but I don't think it was asked.  Although perhaps it was and I couldn't hear his response after "three hits from the bong."

[Parker Hageman]

I did post ashburyjohn's revenue question in the suggestion thread, but I don't think it was asked.

 

 

 

We did cover a lot of revenue/payroll discussion during our podcast prior to the video interview so many of those questions were dropped to avoid redundancy. I transcribed some of the audio/answers from the podcast portion of this event. Check it out here: http://twinsdaily.com/_/minnesota-twins-news/podcasts/no-juice-podcast-27-dave-st-peter-r3169

[Otto von Ballpark]

We did cover a lot of revenue/payroll discussion during our podcast prior to the video interview so many of those questions were dropped to avoid redundancy. I transcribed some of the audio/answers from the podcast portion of this event. Check it out here: http://twinsdaily.com/_/minnesota-twins-news/podcasts/no-juice-podcast-27-dave-st-peter-r3169

Thanks, I didn't realize the podcast and video were different.

 

Just listened, but I still don't think I heard anything specific about revenue and why it might be different than the Forbes estimate.  He went into some tangent about the CBA and debt service.

[Parker Hageman]

Just listened, but I still don't think I heard anything specific about revenue

 

 

He talked about the 50% mark, he talked about the alternative revenue streams and the areas that the other section of revenue is spent on. 

 

You're not going to get specifics. You just won't. Private company, they won't give it out. Should I have asked the Forbes estimate question? Maybe. Just didn't find it that compelling at the time given the length we spent on payroll, revenue and the like. 

[ashbury]

He talked about the 50% mark, he talked about the alternative revenue streams and the areas that the other section of revenue is spent on. 

 

You're not going to get specifics. You just won't. Private company, they won't give it out. Should I have asked the Forbes estimate question? Maybe. Just didn't find it that compelling at the time given the length we spent on payroll, revenue and the like. 

I've never done a journalistic interview, and when I saw my question come up to lead off I kind of gave myself a dopeslap, because it was clear it wouldn't accomplish what I hoped.  I should have taken the time to craft the question in a way that a) he might still answer, and b ) would prove more informative.  My draft was too wordy, so I can see why it was cut down.  With hindsight, I'd have tried something like this:

 

Fans hear lots of financial numbers.  Forbes Magazine has published estimates putting the Twins revenue most recently around $220M.  Club officials mention a 50-52%-of-revenue target for payroll.  ESPN places the Twins 2012-4 major league payroll ranging $75-95M.  The math doesn't work out, using these numbers.  Can you clarify which (maybe all?) of these are misconceptions so that fans can understand better?

 

Basically offering to outline his PR for him. 

[Rosterman]

Debt retirement is not my problem, it is yours. Who did you borrow the money from and how you need to pay it back is a decision you made. If you make a profit and can pay it back sooner rather than later, are we supposed to jump up and down with joy that you are saving money on your investment? If you can't make a payment, I believe you have enough invested to borrow even more, especially since you run a bank. I seem to remember mumblings that Pohlad Dad had leveraged the Twins with the largest outstanding debt that major league baseball would allow him to handle. Better to have the cash and invest in other things, than to pay off what you have...sometimes. You don't lose money on debt in business...you write it off against profits in the long run.

[Otto von Ballpark]

You're not going to get specifics. You just won't. Private company, they won't give it out.

I know.  I don't really want "specifics" anyway -- my post upthread was just a post, not intended to be a question.

 

ashburyjohn's phrasing above works perfectly for me.  I'd change "Forbes" to "Forbes and Bloomberg" because they used some different methodologies, so it is interesting to me that they came up with a similar number (and makes it a little harder to simply respond that "Forbes is wrong" ).

 

Journalistic-ly, I'd even reach out to Forbes and Bloomberg in advance to see if they'd be willing to share any more general detail behind their estimates (local vs national revenue, stadium vs media revenue, etc.).  Would be interesting by itself, and it could also lead to interesting follow-ups.  St. Peter may not be the guy to answer this question, though, at least not in any meaningful way.

 

Thanks for taking question suggestions, though -- it's really awesome to participate like that!  Next time I'll try better to contribute/re-phrase in the most journalistic way I can.

[h2oface]

Fans hear lots of financial numbers.  Forbes Magazine has published estimates putting the Twins revenue most recently around $220M.  Club officials mention a 50-52%-of-revenue target for payroll.  ESPN places the Twins 2012-4 major league payroll ranging $75-95M.  The math doesn't work out, using these numbers.  Can you clarify which (maybe all?) of these are misconceptions so that fans can understand better?

 

Nice.  Be persistent to get the answer.  It was their promise, to spend half the revenue on payroll.  Some representative of the Twins should make sure it is clearly defined and that it is being done.  That was the promise.  It needs to be verified with evidence and not just... "yes, we have".

[Parker Hageman]

Fans hear lots of financial numbers.  Forbes Magazine has published estimates putting the Twins revenue most recently around $220M.  Club officials mention a 50-52%-of-revenue target for payroll.  ESPN places the Twins 2012-4 major league payroll ranging $75-95M.  The math doesn't work out, using these numbers.  Can you clarify which (maybe all?) of these are misconceptions so that fans can understand better?

 

 

This is a very well phrased question. I wish it had been available prior to the Q&A.

 

Not to sound like a broken record but please listen to the podcast section of the show -- http://twinsdaily.com/_/minnesota-twins-news/podcasts/no-juice-podcast-27-dave-st-peter-r3169 -- where he talks about other areas of the organization beyond the 48-52% the money is spent. 

 

As confession -- there are more people here that are concerned about the distribution of the revenue/payroll that I am. I don't know if we have a lot of accountants by trade here, fiscal watchdogs or just passionate fans that feel wronged in some way by the ownership. Personally, I care more about player development. I'm interested/intrigued by payroll/revenues/state of baseball, but ultimately I am more interested in what happens on the field. That probably comes out in both your Q&A and my interview on the podcast with him. I ask the big picture questions about revenue/payroll but I don't have the desire to pound on the topic until he spills everything. 

 

Again, the question above would have been great. Probably would have generated a decent response. I'm sorry if some of you don't feel like you've received your monies worth on this one.

[Mike Sixel]

I thought you did a great job on the interview. And I'm thrilled he gave it. We got about what we should/will get on payroll. 

[daanderson20]

I wasn't interested in asking the same question in a different way 13 more times to a guy who can talk circles around me. They make money. They spend some of it. They pocket some it. World keeps spinnin.

[jharaldson]

I thought it was an interesting interview.  At some point there are only so many ways to ask the same question so I think you moved on well.  

 

jheraldson ;-)

[ashbury]

This is a very well phrased question. I wish it had been available prior to the Q&A..

Like I said, "d'oh".

[DocBauer]

I felt the interview was honest and about as transparent as you could expect.

 

I appreciated comments made about stretching payroll above normal parameters when the organization felt there was a solid reason to do so. And if you look at the 2010-2012 seasons that is clearly evident.

 

I would have liked to hear more about 2015 though, in relation to comments from Ryan in reference to "$100M should be more than enough."

 

Target Field is one of the top ballparks in all of baseball. And the Ft Myers complex, already nice, now has to be the industry standard! But I'd like to know more about this new Dominican facility.

[DocBauer]

On a hilarious but serious note...I enjoyed the comments about Hrbek being in the booth far more than any of us know.

 

If he isn't too busy hunting, fishing, bowling, drinking, or working with his wonderful charity, why isn't Hrbek hired by the Twins in some capacity? Is there a better PR VP candidate? Is there a better choice to join the TV and radio booths for color commentary? He is doubtlessly full of humor, experience, perspective and stories. And while seen outwardly at times as a loveable lug, Hrbek was a highly successful pro. And he's literally a lifelong Twin.

[Otto von Ballpark]

I'm sorry if some of you don't feel like you've received your monies worth on this one.

It was worth my price of admission!

 

Seriously, it was a quality piece.  In an informal chat, St. Peter seems like a fine guy, and you set a good tone (even if we didn't feed you the best questions ).  I don't normally seek out podcasts/webcasts, but this was an entertaining listen, and I will definitely check out the next one.

 

I'm not really obsessive about payroll, but there are some good baseball minds running this club and I don't like to see them hold themselves back in any area of talent acquisition, as compared to their peers.  Even though the results weren't perfect, last winter was great in that we could finally debate how TR performed in free agency rather than why he didn't participate.  I just hope that trend continues and it wasn't seen as special circumstances (due to our league-worst starting staff).

 

Plus, I think it's interesting to examine the tendencies and practices of my favorite team.  Whether it be their approach to finance -- why do observers consider the Twins perhaps the most consistently profitable MLB team? -- to TR's approach to trades (he generally waits to be called rather than initiate contact).  Nothing beats the actual games but hey, we're coming up on a dry spell here...

[Otto von Ballpark]

More related thoughts:

 

The Twins franchise history in inextricably entwined with payroll philosophy.  From the self-sustaining Griffiths in Washington then Minnesota, to the Pohlad years in the Metrodome, to the near sales/moves/contractions, even now with TR's general approach to team-building.  It's actually quite interesting how elements of that philosophy have persisted all through relocations, ownership changes, stadium constructions, and the dramatic modernization of the business of professional baseball.

 

Also, I don't follow any team nearly as much as the Twins, but it seems like many Twins fans have an interesting frugality about them too.  Sure there are posters here and elsewhere that want the team to "spend spend spend", but taking a step back, several of the founding members of Twins Daily, some of the most prominent and vocal Twins fans ever, are full endorsers of the conservative FA approach.  And I think of someone like Aaron Gleeman, no stranger to criticizing the front office, and how often his positions are centered on value and optimizing resources.  I mean, we have a thread going right now about basically acquiring Buehrle for a throwaway prospect, and a number of posters are against the idea because Buehrle's 1 year, $19 million deal, while short-term and easily affordable for this club, still seems sub-optimal to them.