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Four owners reportedly objected to MLB’s luxury tax increase (UPDATED)

The players rejected the offer anyway but the CBT is a hot button topic for the owners as well.

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Los Angeles Dodgers v Cincinnati Reds Photo by Michael Hickey/Getty Images

Major League Baseball and the MLBPA held an informal meeting Thursday in New York which was the first since the cancellation of the first two series of the regular season. More games are expected to be cancelled as soon as next week and the possibility of losing the entire month of April is high.

Both sides met for 16 hours Monday which was the league’s original stated deadline for a deal. That was eventually extended to Tuesday but talks fell apart in the afternoon. One of the major sticking points is the Competitive Balance Tax. The league upped its proposal to $220 million which is significantly less than the $238 million the union is seeking. The CBT threshold was at $210 million in 2021.

Evan Drellich provided some insight into the owner’s discussions about the CBT in an article Friday for The Athletic. Drellich reports that four owners objected raising the league’s CBT offer to $220 million. Those were Red owner Bob Castellini, Tigers owner Chris Ilitch, Diamondbacks owner Ken Kendrick and Angels owner Arte Moreno. The league pressed forward with its offer despite those objections.

The resistance of the four owners reveals at least some of the hard-liners who are likely influencing perhaps the single-most contentious issue in negotiations that have already cost the sport games. One person briefed on the call noted that White Sox owner Jerry Reinsdorf, a hawk in the 1994-95 dispute, was not among those to stand in the way. Not all small-market owners — owners who theoretically would be most disadvantaged by an increase in the luxury tax, which curtails high-end spending — were opposed to the raise, either. Rather, at least some of the four owners took stances based on their personal feelings toward costs and baseball’s economic system, sources said.

That is relevant to future negotiations as the Competitive Balance Tax remains the biggest issue between the two sides. While smaller market teams were thought to be the ones most in favor of keeping the CBT low as to not allow teams like the Dodgers, Yankees and Mets outspend everyone, it is notable that Moreno and the Angels are named.

Drellich also reveals another detail that irked the players in the most recent proposal was that the league wanted to include the amount of money that the players receive for food as part of the luxury-tax calculations.

The luxury tax already includes some player benefit costs — it’s not just a strict accounting of player salary. But players were angry, sources said, the league would try to add something as fundamental as the cost of food as a reason to spend less on payroll.

That is next level pettiness.

UPDATE - The league responded to Drellich’s report and called it “grossly mischaracterized.”

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