If you have followed the saga of the Oakland A’s, then you know about the ‘Flip Tax’ MLB has imposed on any potential sale of the franchise by John Fisher. Some believe this to be a veiled vote of no confidence in the Athletics owner. However, as the west coast’s own Daz Dillinger once exclaimed.
Hold up, wait a minute, indeed. The Oakland A’s “Flip Tax’ is utterly pointless. Anyone trying to tell you otherwise simply doesn’t know what they are talking about. John Fisher was never, ever going to sell the team between now and a potential new stadium being built in Las Vegas. It doesn’t make any sense and flies in the face of baseball history.
In case you aren’t familiar with the tax provision, Bob Nightengale of USA TODAY reported the A’s relocation agreement includes a caveat that states Fisher would need to pay a tax should he offload the team between 2028 and 2034. This starts at 20 percent in the first year while progressively getting smaller annually. Additionally, he may not sell the team between now and 2027.
This move by Rob Manfred and Major League Baseball owners is good for Fisher. Hell, he probably requested it be added. Not only does he now have a reason to aggressively ignore any calls to sell the team before its move to Las Vegas (Manfred won’t let me, lol), but the Gap heir is now on a well-traveled path of stadium build and dumps.
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Miami Marlins
Let’s start with the Miami Marlins and a topic covered here previously. In 2012, scumbag Jeffery Loria finally got a new baseball stadium completed in the city. Surely, the art dealer was in it for the long haul just as Fisher claims he is. Yeah, about that.
Loria sold the Marlins five years later, raking in a considerable profit for his troubles. It was pretty obvious his goal the entire time was precisely that. He purchased an MLB franchise, built a new stadium, waited a few years and then flipped it.
Atlanta Braves
The Atlanta Braves moved into Truist Park in 2017 which was part of a larger real estate development built by Liberty Media, the ballclub’s owners. All of those assets were placed into a separate publicly traded company this year with two clear goals in mind.
The first was for the ownership entity to gain tax breaks. I suppose those hundreds of millions of dollars in public financing weren’t enough to help. Anyway, the second goal of the spin-off was to make it easier for Liberty Media to sell the Braves. In fact, most folks believe it is a matter of when, not if, the team is sold.
Pittsburgh Pirates & Cincinnati Reds
PNC Park opened in 2001 giving the Pittsburgh Pirates a beautiful new home. A few years later, minority owner Bob Nutting, well his family, would purchase controlling interest in the franchise. There were a few other issues at play here, but this probably doesn’t happen without a new ballpark having already been completed.
A similar episode played out with the Cincinnati Reds who opened Great American Ball Park in 2003. At the start of 2006, Carl Lindner offloaded the team to a new ownership group.
Milwaukee Brewers
Who started all this? Probably Bud Selig. Seriously, who else could it be? Despite having served as acting commissioner since 1992, the Selig family was never forced to give up its stake in the Milwaukee Brewers. Selig maintained he handed over the reins to his daughter, but that seems far-fetched given what happened.
The team began working on a new stadium in the late 1990s which would open in 2001. And what do you know, a few years later in 2004, Selig’s family sold the Brewers. They could have sold it in 1998 when he was named commissioner on a permanent basis. The family could have sold it anytime before Miller Park was finished. But they waited.
Related: The Milwaukee Brewers relocation threat is a baseball shakedown
The truth about the Oakland A’s ‘Flip Tax’
By the way, those are just a few notable examples. The New York Mets, San Diego Padres and Philadelphia Phillies were all sold ten or so years after the opening of a new stadium. Now, there are various reasons at play here but it’s impossible to ignore the trend.
MLB owners never sell while a stadium is being built or within the first few years of its operation. That doesn’t make any sense. The value of a team won’t reach its peak until the new ballpark is bringing in revenue. Full stop.
To that extent, the Oakland A’s ‘Flip Tax’ is good for John Fisher. It places him in the sweet spot of selling an MLB franchise which is five-to-ten years after a new stadium has been opened. What do baseball owners get out of this deal? Optics, I reckon. They can at least claim to have put guardrails in place assuming no fan has ever paid attention to how these matters work.
Of course, some out there want to believe this may prevent Fisher from funding his portion of a new stadium in Las Vegas. It really doesn’t, though. As Brodie Brazil mentioned in his video on the topic, we have no idea if this covers minority ownership stakes in the A’s. Nothing may stop him from spinning off 10 percent of the franchise tomorrow.
Even if that is also taxed, the end game in all of this is so obvious. Fisher will eventually sell the A’s in the 2030s and, at this point, the Fertitta family are the most likely buyers. Nothing is stopping them from reaching some sort of handshake agreement that ensures they’ll assist with stadium funding today with an understanding their group can purchase the ballclub when the Oakland A’s ‘Flip Tax’ expires.
This has seemingly been the plan from day one, by the way. MLB owners have followed this playbook for the past 25 years. Maybe the timeline and financing are different. It has never been this messy. But the end result is always the same. Get a new stadium built and sell a few years later.
The Oakland A’s ‘Flip Tax’ doesn’t change anything. In reality, it actually helps Fisher because now he has a reason not to sell the team.
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