Players keep their caps on, weighing new 'tax' plan

HERNDON, VA. — HERNDON, Va. -- Baseball ownership presented a new contract proposal to striking players yesterday, but it appears the long-awaited alternative to management's salary cap proposal will not lead to a quick settlement.

Economists hired by the Major League Baseball Players Association spent last night examining a 102-page proposal that replaces the salary cap with a heavy tax on excessive payrolls, but the owners apparently are trying to keep the hard cap as an option in the event they decide to declare an impasse and DTC unilaterally implement new work rules.


"They gave us a revised salary cap proposal that contains certain provisions that are necessary to understand their tax proposal," said Gene Orza, the union's associate general counsel. "The clubs' strategy is to put both on the table, but what we discussed was the taxation proposal."

The negotiations resumed yesterday at the Dulles Airport Hyatt Regency. The bargaining units are expected to meet again early today and could continue to negotiate indefinitely if special mediator William J. Usery feels that progress is being made. That almost certainly will depend on how the players react to the


first real movement by the owners since they made their salary cap proposal on June 14.

Boston Red Sox chairman John Harrington, who was appointed chairman of the ownership committee last week, telegraphed management's parallel-proposal strategy on Saturday when he insisted that the owners still would be able to impose the cap if their new proposal was rejected by the players. A union lawyer said yesterday that the MLBPA does not believe that approach will stand up to scrutiny from the National Labor Relations Board, but the union did not put up a fight yesterday.

Representatives on both sides were reluctant to talk about the specifics of the new proposal, but it apparently is similar to the taxation proposal that has been rejected by the NHL Players Association.

"It looks a lot like the proposals you've seen in other industries," said Kansas City Royals pitcher David Cone.

It also is similar -- in some ways -- to the taxation proposal that the players made to the owners in early September, but the percentages are so much more dramatic that union officials fear it could be even more restrictive than the salary cap.

"It's essentially the proposal the press has speculated about," Orza said. "Right now, all we're doing is analyzing the full dimensions of it. Obviously, it took a long time for them to come up with it. They worked hard on it and we'll work hard on it, too."

The players may have an answer today, but only if they are satisfied they have enough information to properly analyze the ownership proposal. Union officials would not say last night whether they will make a counterproposal.

"I think it's our turn," Orza said, "but we want to give their proposal the attention it deserves. We'll have a response in good course."


Both sides were under instructions from Usery not to discuss the specifics of the proposal, but it is believed to include a progressive tax on payrolls that would severely penalize teams that exceed a certain revenue-based salary limit. The players are certain to reject the specific financial terms, but a question remains whether the two sides finally will be in a position to remove the ideological barriers to a settlement and move toward common ground.

"I guess we feel good that they came in with a proposal on the taxation wavelength," said Milwaukee Brewers pitcher Bob Scanlan, "but

we have to look at it and see if it is something we can live with. It's tough to tell where the middle ground is."

It's also tough to tell whether the owners are sincere in their desire to negotiate a contract or are simply going through the motions to protect their right to implement the salary cap.

"I will not characterize the meeting today," said Usery. "Every day is a new day. I hope with each new day we get closer to where we want to be. We're here. We're negotiating. I feel everybody is desirous to conclude a negotiated agreement."

No one disputes that, but management sources have been saying all week that the owners would be foolish to make any major concessions now that they have lost two months of the 1994 regular season and at least $140 million in postseason broadcast revenues.


The ownership bargaining unit must come back with an agreement that does not wipe out the revenue-sharing arrangement that was negotiated in Fort Lauderdale in January. And it is very doubtful that the players would agree to anything that falls within the narrow financial parameters necessary to keep that revenue-sharing proposal as the centerpiece of baseball's new economic system.

The Associated Press reported last night that the owners' proposed tax would be on the top 14 teams and would affect just payroll, not revenue.