January 26, 2011

The Payoff Pitch

Will the A's Ever Move to San Jose?

by Neil deMause

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It has been almost a year since I last checked in here on the Oakland A's long-running game of footsie with San Jose, where owner Lew Wolff has been dreaming of moving the franchise seemingly ever since he bought it in 2005. At the time, a three-man task force appointed by Bud Selig to decide the team's future was entering its 12^th month of deliberations. Selig promised that their report "will be coming in the near future."

A's fans will be forgiven for wondering if Selig meant a near future in geologic time. The three men—former Arthur Anderson sports consultant Bob Starkey, ex-Giants vice-president Corey Busch, and MLB lawyer Irwin Raij--have now been at their task for 22 months, in which time they've produced absolutely zilch in the way of a resolution to the question of where the A's will be playing long-term.

Last week, the frustration was enough to get Fox Sports' Ken Rosenthal to pen an open plea to move the A's already. Rosenthal's arguments: The A's, stuck in an unattractive stadium that draws few fans, are hamstrung from signing star free agents; San Jose is bigger and wealthier than Oakland, and moving the team there would boost revenues not just for the A's but for MLB as a whole; and given that the only holdup is the Giants' possession of territorial rights to the area, it should be easy enough for MLB to sit everybody down and hash out a deal, just as it did for moving the Expos into Orioles territory in 2005.

It's a tempting narrative, and plenty of people--most of them residents of the South Bay, if my e-mail in-box is any guide--are wishing that Selig would just get on with it and declare San Jose and the A's lawfully wedded. But there are reasons why a San Jose move is far less of a slam dunk than Rosenthal makes it sound.

It's clear that the big sticking point is the territorial rights issue. This is one of the more bizarre stories in recent baseball ownership history: Back in the late 1980s, when then-Giants owner Bob Lurie was getting referendum after referendum held to try to get a stadium built so that he could move his team to San Jose (and losing every time), he asked then-A's owner Walter Haas for exclusive rights to the South Bay. Haas, being a generous sort--and, you have to assume, salivating at the thought of a suddenly vacant San Francisco market just across the bay--said fine. Now, 20 years later, Giants owner Bill Neukom has invoked the legal doctrine of "no backsies."

So far, the two sides have been huddled up in their respective corners, Neukom declaring that the South Bay is not for sale, while Wolff has publicly called on Selig to hand over San Jose "for the good of baseball." It's the kind of situation that calls for a mediator who'll knock heads and force the two sides to meet in the middle, but Selig is not that kind of Commissioner--and as Rob Neyer has pointed out, even if he were, there's enough anxiety among owners about opening the Pandora's box of territorial rights transfers that he might not be able to get the votes to back him up. (The Nats-Orioles deal that Rosenthal mentioned as precedent was actually over television rights, which in MLB terms are a whole 'nother kettle of fish from territorial rights.)

But even if Selig were to lock Wolff and Neukom in a room and tell them not to come out until they had a deal, it's not entirely clear that there's a dollar figure that would work for both sides. Here it's probably best to think not about the individual cities involved, but rather of the Bay Area as one giant, sprawling market, which for all intents it is, albeit one where it's a hefty drive between the farthest-flung bits. In that respect, it's not all that unlike the Connecticut-New York-New Jersey market, though with the complicating factor of the bay and a bunch of bridges that act as traffic bottlenecks thrown into the mix.

With that in mind, you currently have the Giants in firm control of San Francisco, while also drawing a significant chunk of fans from further south on the Peninsula and on into the South Bay--it was Silicon Valley money that has helped the team pay for AT&T Park. The A's are left with the East Bay. It's relatively populous, since about 2.5 million people live in either Alameda County (which includes Oakland and Berkeley) or Contra Costa County (across the hills to the east), but that population is more diffuse and less money-soaked than its neighbors to the south.

So, move the A's to San Jose, and what happens? The Giants, presumably, would lose most of their South Bay fan base, and gain some disaffected East Bayers in exchange; the A's would make the reverse swap. It's not quite a zero-sum game, though: If all works according to plan, the number of San Jose denizens who'd pick up the baseball bug would be more than the number of Oakland-area fans who'd swear off baseball and buy Monta Ellis jerseys, and the rising tide would lift all boats.

How far would it lift them, however? To make a San Jose A's move work, then, you'd need to generate enough new revenue to:

• Pay off the Giants' indemnification demands for giving up Silicon Valley;
• Generate around $30 million a year extra to pay off the estimated $461 million construction cost of the San Jose stadium that Wolff says he will build himself (California being probably the hardest state in the nation to get taxpayer stadium funds approved in, given its stringent public referendum requirements); and
• Leave some money left over to pay all those free agents that Rosenthal insists would come a-running as soon as the A's were out from the shadow of Mount Davis. Figure $50-60 million total at minimum--and it would all need to come from new San Jose fans, less the number of lost Oakland fans.

It's a tough mathematical nut to crack, even when you don't have two sides playing North-going Zax and South-going Zax. The latest developments out of Sacramento aren't likely to make the math get any easier: Jerry Brown, recently reinstalled as California governor after a 28-year layoff, has made as one of his first orders of business filling the state's yawning budget gap by eliminating the state's local redevelopment agencies, which for decades have been siphoning off local tax revenues and stockpiling them for use on development projects. Since Wolff is counting on San Jose's RDA to buy the remaining land needed for his stadium ("paying for it yourself" has its limits, after all), that would tack on an extra $20 million on the cost side of the equation.

If not San Jose, where else could the A's go? Oakland has its own stadium plan in the works for its downtown Jack London Square area, though it's only in the initial planning stages and is also dependent on RDA money. Failing that, Wolff could cast his eyes outside the Bay Area, to Sacramento, or Portland, or Las Vegas. However, none of those cities have MLB-ready stadiums, or much hope of building them anytime soon; all have relatively dismal local economies, and all are fairly dinky in terms of market size. It's one reason why Buster Olney's recent speculation about MLB pulling a John Henry and putting Wolff in the Dodgers owner's seat while taking on the A's as an Expos-style ward of the state doesn't make a whole lot of sense, because the two best relocation options then (DC and Northern Virginia) now off the table thanks to the birth of the Nationals, so it would be hard to get much of a bidding war going with the remaining dregs--unless Selig were willing to take the bold move of threatening a return to by far baseball's largest unoccupied market.

 All of which is why we're in this standoff, with no end in sight barring Seligian intervention. Though at least we have a great soundtrack for the eventual TV movie. 

Neil deMause is an author of Baseball Prospectus. 
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