Hanley and Haugh were on this morning's sports talk discussing the question of Theo Epstein's contract extension which continues to be going no where.
They indicated that writer Jon Heyman speculates that since Andrew Friedman got $7 million plus bonuses from the Dodgers, Epstein is worth $10 to $12 million. If true, the question is whether any baseball executive is worth that kind of money.
Hanley and Haugh opined that since the Cubs "are printing" money with all the new construction and revenue sources inside and outside of Wrigley, making Epstein the highest paid executive is basically a no brainer.
But their premise is incorrect. The Cubs are not building the new plaza building or McDonald's block commercial spaces. Those real estate development projects are owned and controlled by different Ricketts family business entities. The Cubs are basically only a tenant in Wrigley Field (also owned by a different legal entity). The Cubs main revenue sources are ticket sales, concessions and broadcast revenues. The rest of the revenue generating business ventures goes directly to the Ricketts family.
Then, Haugh confirmed that Ricketts told him last year the most "undervalued" person in the Cubs organization was Crane Kenney. Kenney is in charge of the "business" side of the Cubs. He is the one who sets the baseball budget, not Epstein. Haugh said that Kenney recently got his contract extension from Ricketts.
Which gets back to earlier posts on this blog.
The Ricketts have used broad brush strokes of the Cubs and the team's continued success relying upon new revenue sources from outside the park real estate and business ventures. But those ventures are separate and legally distinct from the Cubs baseball team.
Epstein has said that he has had to get create and pull teeth in order to make last off-season's moves to sign Ben Zobrist, Jason Heyward and John Lackey. The business side of the organization has put the brakes on what Epstein really wants to do with the Cubs. Since day one, there has been this conflict.
At least the radio hosts recognize that Epstein may be fed up with the office politics and penny pinching budgeting of Kenney so Epstein does not sign a contract extension with the Cubs.
Then what happens?
Ricketts and Kenney could still claim their leadership and business skills were part and parcel to the success of the Cubs. They are the ones who approved all the major moves Epstein made during his tenure. It seems like the Red Sox situation all over again, when Epstein was tossed aside due to upper management and ownership wanted the spotlight on them for the championships.
It comes down to these theories:
1. Epstein will only sign an extension if he gets FULL control of all Cubs operations, including business side and budget.
2. Epstein does not want to sign an extension so he can get a better deal as a "free agent," which in my mind could include an equity stake in a franchise.
3. Ricketts does not want to pay $60 million for a President of baseball operations when there are costly overruns on his dream real estate projects.
4. Ricketts and/or Kenney may believe that since the minor league foundation of success is in place, they don't need Epstein or Hoyer to lead the franchise in the future. They can find someone else to be the General Manager under their control.
5. At the last minute, both sides will come to a compromise agreement.
However, if Epstein really wants to stay, and Ricketts really wants Epstein to stay, a contract extension should have been worked out a year ago.
