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Old 07-17-2008, 01:39 PM   #1
tony hipchest
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Default The Rooneys "Cheap" Image Explained

really nice article chock full of "insider" info that gets down to the dollars and cents.

http://www.pittsburghlive.com/x/pitt.../s_577825.html

Quote:
Erickson, who is not involved in the Steelers situation, sees a Rooney family that's been "gifting" a portion of their earnings to fans for two decades.
if the steelers were really "cheap" (cardinals bidwells or cinci's brown family) they wouldve put thir own profits ahead of fielding a competitive team.

Quote:
"Fans don't realize that. The public wants payroll to be higher. They want the better players. They want to win. But that probably means a lot less for the owners," said Erickson, whose company has helped value or brokered deals for more than 50 professional teams, including half of the NFL's franchises.
Quote:
As the market for NFL teams heated up in the 1990s and franchise sales inched toward the $1 billion mark for a single team, the Rooney brothers let their money ride with the local club and focused on winning, a tradition Art Jr. says "permeates the entire family."
the winning before cashing in on profit philosophy obviously comes from their father in his later years (who was known to gamble).

Quote:
According to court filings, the value of their stake in the football franchise increased 16 percent between 2001 and 2007, or about 2.7 percent annually. That's about what a small wad of cash in a savings account would earn.
ouch

Quote:
Based on court filings, each share of PSSI stock paid between $705 and $1,296 in annual dividends between 2004 and the royalty highmark of 2007. That equated to between $2 million and $3.7 million before taxes for each of the late Art Rooney Sr.'s sons annually, once all their shares are added up. The court filings suggest there could be more than 17,900 total shares in the company, with a pot to be passed out of between $12.6 million and $23.2 million, depending on rising expenses or revenues.
ouch x 2. talk about a poor return on an investment.

Quote:
Neither Rooney family members nor the accountants who prepared the report would discuss the details. Their valuations were tied to a recent divorce of a cousin to the Rooney brothers who owned 77 shares in the franchise, or less than half of 1 percent of PSSI.
so thats how this info became public.

Quote:
The apparent 2007 dividend surge came before the team went on a $9 million buying spree in 2008, hiking player wages an estimated 8 percent, sparked largely by quarterback Ben Roethlisberger's eight-year $102 million contract extension. As a family business that pays a dividend based on profits, when the Rooneys raise salaries to remain competitive on the field -- including Roethlisberger's $25.2 million signing bonus -- they take money out of their own pocket, according to Don Erickson of the Dallas-based Erickson Partners.
on a good year ben can be making more profit than the steeler organization as a whole.

isnt it ironic that its robert kraft who raised the ticket prices 33% (or something outrageous) this year and not the rooneys?

i really dont think the rooneys would stick it to the fins like that just for the sake of profit. it would be nice if a partnership of dan rooney and drukenmiller could preserve that tradition of not sticking it to the fans (and still being able to field a team better than the yearly suck known as the bungles and cardinals).
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Old 07-17-2008, 01:44 PM   #2
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Default Re: The Rooneys "Cheap" Image Explained

I thought not grossly overpaying for marginal, overhyped talent in FA was largely responsible for the "cheap" label, but what do I know.
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Old 07-17-2008, 02:03 PM   #3
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Default Re: The Rooneys "Cheap" Image Explained

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I thought not grossly overpaying for marginal, overhyped talent in FA was largely responsible for the "cheap" label, but what do I know.
yeah, who woulda thought there was a logical, fiscally responsible reason to why they dont go pissing money into the wind every year.

i would say true die hards who actually ripped the rooneys and they way they operate were pretty much looking the gift horse in the mouth.

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Old 07-17-2008, 03:45 PM   #4
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Default Re: The Rooneys "Cheap" Image Explained

Quote:
Originally Posted by tony hipchest View Post
yeah, who woulda thought there was a logical, fiscally responsible reason to why they dont go pissing money into the wind every year.

i would say true die hards who actually ripped the rooneys and they way they operate were pretty much looking the gift horse in the mouth.

I guess sometimes it's best if, as fans, we just not say so much - and be fans and let ownership do what they do!!

We've definitely reaped the rewards of that program!!!
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Old 07-17-2008, 03:56 PM   #5
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Default Re: The Rooneys "Cheap" Image Explained

I guess I'm more of a realist so maybe my opinions can be a bit off the wall. But wouldnt you rather have more of a conservative owner or an owner like al davis who overpays for bums like javon walker and d hall. and gives outragous contracts to rookies and overpays tommy kelly
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Old 07-17-2008, 05:39 PM   #6
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Default Re: The Rooneys "Cheap" Image Explained

Good stuff

The article illustrates how the salary cap as currently structured is bleeding the smaller market teams that run their teams as a primary source of income (e.g. - Rooneys, Brown, Irsay in Indy, Wilson in Buffalo) rather than as a trophy. Dan Rooney has let this situation roll because he is a "league guy" unlike Brown & Wilson and has not vocally bitched about the CBA. So the only way the Rooneys can pay at cap level is by not drawing greater dividends and the non-active family members apparently are no longer happy with that arrangement.

If the Steelers had more profit they could pay out greater dividends while still paying at the salary cap. If they want more dividends with current revenue streams and costs then they will not pay to the cap level and will be putting out a less competitive product, at which point the Steelers become the Pirates.

Since any profit is not going to markedly increase in the foreseeable future, since any increases in revenue will at best track further salary cap increases under the current CBA, it appears the Steelers need ownership that will not feel as much of a pinch from not maxing out on dividends. In other words, the stakes in the NFL poker game have gotten above the Rooneys comfort zone financially.

In that case, it may be time to cash out and let someone else put in their chips. Taking on more debt to allow Dan and AJR II to maintain control will simply increase the financial strain on operations.
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Old 07-17-2008, 06:23 PM   #7
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Default Re: The Rooneys "Cheap" Image Explained

It's almost a damned if you do, damned if you don't. Some revenue increases will likely come from jersey sales and such. Let's face it, you've got some big names on that team that will sell jerseys to Fairweather fans all over the place. If the Browns were to have another big year, you know DA or BQ jersey's would pop up EVERYwhere as well. You'd also likely see more #17 jerseys too.
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Old 07-18-2008, 11:09 AM   #8
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Default Re: The Rooneys "Cheap" Image Explained

In the pre-draft issue of Steelers Digest, Rooney was quoted as saying something along the lines of "I really don't like raising ticket prices...I want to keep games affordable for the fans".

He's probably the one owner in the league who I actually believe when he says that.
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Old 07-18-2008, 12:06 PM   #9
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Default Re: The Rooneys "Cheap" Image Explained

Quote:
Originally Posted by Big D View Post
I guess I'm more of a realist so maybe my opinions can be a bit off the wall. But wouldnt you rather have more of a conservative owner or an owner like al davis who overpays for bums like javon walker and d hall
Al Davis has also partially lost his mind....I think that helps explain things....
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Old 07-18-2008, 12:54 PM   #10
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Default Re: The Rooneys "Cheap" Image Explained

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Originally Posted by redst3 View Post
Al Davis has also partially lost his mind....I think that helps explain things....
"Partially"? Wotchoo talkin' 'bout, Willis?
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