Friday evening the Cincinnati Reds officially handed out their 2022 team awards on stage at Redsfest. One player was missing, though. Team MVP and Joe Nuxhall Good Guy Award winner Kyle Farmer, who was traded to the Minnesota Twins just over two weeks ago, couldn’t be there to accept his award, instead sending in a video to be played on the videoboard. In his final year with the Reds, Farmer played in 145 games and hit .255/.315/.386 with 25 doubles, a triple, 14 home runs, and 78 RBI.

While it wasn’t in the video, Kyle Farmer had some interesting things to say to the Cincinnati Enquirer’s Charlie Goldsmith, that he published late on Friday night.

“No one understands that everyone wants to play in Cincinnati,” Farmer said. “They want to be in Cincinnati. Castellanos wants to be back in Cincinnati. Sonny wants to be back in Cincinnati. Wade wants to be back. Tucker wants to be back. Everyone who comes there wants to stay in Cincinnati. It’s not like people who leave are happy to leave. It’s that they just can’t keep them around. It’s kind of sad. Everybody loves Cincinnati. It’s a sad thing that we all can’t stick around.”

Sad indeed, Kyle. But there’s a difference between can’t keep them around and won’t. The Reds could have kept all of those players mentioned around with the exception of Nick Castellanos, who was a free agent – though he, according to Farmer, wanted to come back.

The Reds ownership has talked about payroll, revenue, money, etc. over the years. They’ve had payrolls in the $140-150M range in the past. Their payroll for 2023 right now looks to be about $70M. The team just got $30M for the sale of the final 15% of BAMTECH (they had gotten about $50,000,000 from the first part of the sale in 2017), which was their streaming company that came out of the company they formed 20-something years ago for MLB.tv. Bob Castellini was sure to tell the Cincinnati Enquirer when MLB owners sold the other 85% of BAMTECH to Disney several years ago that it “wasn’t baseball properties” – which is hilarious given that the BAM in BAMTECH was taken from MLBAM, which stands for Major League Baseball Advanced Media.

Some of that money, though, Castellini said, did go towards the team while “30-35% of it went to the ownership group”. We don’t know if any of the money from this time around will be put towards the team or go to the ownership group.

What we do know is that the Reds have plenty of money to spend on payroll this year if they would like to. Between the local broadcast rights deals and the national broadcast rights deals alone they are bringing in $100,000,000. Then of course there’s all of the other monies they make selling tickets, merchandise, parking, beer, food, etc.

Rebuilding is an option, not a requirement. There’s nothing wrong with trying to go with a younger roster overall. But there should be a problem with not trying to win baseball games. It’s still early December, so there’s plenty of time for the organization to spend money or make more trades to acquire big league talent. But if the Reds go into March with a payroll that isn’t much different than it is today and a team that doesn’t have a single outfielder they know who will be starting every day if he’s healthy and two-fifths of the rotation a complete unknown, it should be something that people should hear about who are in the ownership group and front office.

The Team Awards

Alexis Diaz was named as the Johnny Vander Meer Pitcher of the Year for the Reds. That shouldn’t be much of a surprise to anyone. Diaz posted a 1.84 ERA in 63.2 innings spread out over 59 games in the 2022 season. On a team with about as unreliable a bullpen as you can imagine, Diaz was about as lights out as they come in the game.

On the minor league side of things the team handed out three awards. Elly De La Cruz was named the Sheldon Chief Bender Player of the Year. Alex McGarry took home the Hitter of the Year Award. And left-handed starter Andrew Abbott was given the Pitcher of the Year Award.

De La Cruz, the organization’s top prospect. hit .304/.359/.586 with 31 doubles, 9 triples, 28 home runs, and had 47 stolen bases in 120 games played between High-A Dayton and Double-A Chattanooga. Alex McGarry played in 110 games between Dayton, Chattanooga, and Triple-A Louisville (just 8 games) and hit .264/.316/.543 with 23 doubles, 6 triples, 27 home runs, and had 15 steals. Andrew Abbott, the organiztion’s 14th rated prospect went 10-7 with a 3.81 ERA in 25 games between Dayton and Chattanooga while throwing 118.0 innings with 48 walks and 159 strikeouts.

62 Responses

  1. Votto4life

    Thanks for the article Doug. I would love to know the real story between Bob and the other owners. My theory is that Dick Williams was forced on Castellini. I wouldn’t be surprised if Bob and Phil made Dick Williams life so miserably, that he quit. That my uninformed theory anyway.

    I also think Bob was probably resentful of some of the former GM’s moves (namely Moose and Shogo). It also seems to me that Bob was angry about the latest CBA.

    Bottom line for me is Bob Castellini is being petulant. He wants to go back to 1950s. He thinks since he was successful in the produce business, he can run a Major League Baseball team. He is clearly over his head.

    If Bob Castellini isn’t making money as a MLB owner, he can remedy the situation by simply selling the team.

    • David

      Selling the team would be “giving up”. And yes, he is living in a past era of baseball.

      Maybe not the 1950’s, but the 1960’s-70’s.

      Petulant? Bob Castelllini? I am thinking of another Bob, Bob Howsam. Could you imagine Mr. Bob Howsam working for someone like Bob Castellini? Bob Howsam was a GM for the Reds from 1967 through 1977. As GM, he sort of presided over the Big Red Machine. As GM of the Cardinals before that, he had a large hand in creating the Cardinals team that was in the World Series in 1967 (win) and 68 (lost).
      Just about everything that Bob Howsam touched was successful. Why? Because he was an intelligent man, who understood what he was doing. He hired intelligent people to work for him, and listened to what they said.

      Bob Castellini has had a successful produce business. But he was never successful (on his own) in “sports business”. But Bob C. believes he “knows” everything he needs to know about baseball, and likely doesn’t need the help of these…”baseball people”.

      • Tom

        Bob Howsam never had to deal with with player free agency as we know it today. He was smart enough to have contracted most of the “machine” players to contracts that ran past either the advent of free agency and/or through the time of their useful baseball career life. Go back and see how many of the “machine” finished their careers in Cincinnati. It’s a different game today where the rich get richer and the small market teams have to be satisfied with making the playoffs once in a while but, seldom little else.

    • Bob

      My understanding is that Dick left the GM role abruptly to take care of the Williams family failing commercial real estate business. And yes that was pre COVID, so I can only imagine it’s worse. We need to get used to the idea our owners are broke, and even after 2024 payrolls may not get much higher then 80-100 mil. I’m imagining a very pirates future as the Castellinis companies are gutting ppl as well. This dumpster fire of a team is the only thing the owners have worth anything. We are absolutely doomed as fans. Where you gonna go?

      • Bob

        And in Dicks defense, his signings weren’t great, though somewhat defensible at the time, I believe he laid a lot of minor league development ground work that young players rave about now.

    • Shawn

      I have been a lifelong reds fan the way things are going now I really think Bob needs to spend some money and make the reds aleast good again or just sell the team so we at least be competitive please

    • Doug Fickert

      I agree with the last sentence. He needs to sell and move on.

  2. Amarillo

    I want to see a World Series in my lifetime. I’m just not interested in being “competitive”. I’m as sad to see those players go as anyone else, and many were sent away in moves that reeked of incompetence, but quite frankly the recent teams just haven’t been anywhere close to competing for a World Series. In my opinion, almost every single move made last offseason was a poor move, but blowing up the team is ultimately the correct decision. 8 of Doug’s top 11 prospects were acquired in the last 12 months as a result of the tear down. Let’s see how they do.

    • Doug Gray

      Blowing up the team is one thing. Not spending any money at all to try and win some baseball games in 2023 is another. There’s a whole lot of money the organization should be fully capable of spending to add good players to the roster and still have all of those good prospects you’re talking about that can come up and join the squad if and when they are ready. Simply not trying to win in 2023 because there are some prospects in the minor leagues is something that I will never support. You can have your cake and eat it, too…. if you choose.

      • Bdh

        For sure. I think it should be a no brainer to add an outfielder to a 4-5 year deal. I’ve thought Benintendi had made way too much sense for the Reds. Lines up perfect for when some of the current group will need extended and helps open the door to contending a little sooner.
        I also think if they don’t add Cueto that a starting pitcher they add should be 2-3 year sort of deal.

        Also I think it’s more possible than ever that Krall is able to move Moustakas and take back on some other teams bad contract in return. Don’t know what team or what position player it’ll be but if they get Moose off the team then I’m hoping they try to add Tucker and have 1B/DH split between Stephenson/Votto

      • TR

        I agree with you, Doug. You don’t just give up on a season because the team is in another rebuild and it has prospects in the farm system. Come on, get with other ML teams that are making an effort to win, or else step aside and let other owenership run the baseball operation.

      • DX

        What positions would you spend money on where you didn’t block the young players? Would these players be a one year or multi year contract? Do you have a for example?

      • Doug Gray

        Well, I guess it’s unrealstic to ask them to find a better shortstop than the one they just acquired, but they should be looking for a third baseman, several outfielders, and several pitchers (starters and relievers).

        One year contracts tend to go to players that you can’t rely on to be good. That’s not always the case, but it’s almost always the case. Sign a few guys to actual contracts. You know, good players. I don’t have examples off of the top of my head, but targeting players like Kevin Newman simply isn’t it. With a payroll right around $70M right now they should be spending at least $50M in free agency for the 2023 season. You can get quality players for that. And there’s also next to no money on the books for 2024 and beyond. The money is there. Use it.

      • MBS

        @Doug, “You can have your cake and eat it, too…. if you choose.” This is so true. I agree with those who said we needed to blow up the old team. It was poorly constructed. That being said, there are a lot of pieces that the Reds could afford, to make the team competitive in 23 / 24. If they just spent 120M they could add:

        1 of: Benintendi/Conforto/Bellinger/Gallo 14M – 18M
        1 of: Jansen/Chapman/Kimbrel/Smith 8M – 15M
        1 setup or middle reliever 3M – 8M
        and depending on which ones you sign, and for how much you could still have 8M – 24M left to sign a starter for the rotation. These hypothetical teams wouldn’t win the WS, but they’d be fun to watch, and a good environment for EDLC and company to join in.

        Instead the Reds seem to be determined to keep as much money as they can in the pockets of the owners. Some people support this notion, I guess they figure the extra money goes into future payrolls, but I believe it goes into their pockets.

      • BK

        @MBS, Doug cited the one example of when the Red’s Owners have taken a dividend on their investment, the BAMTECH sale in 2017. Otherwise, available financial analysis (see Forbes) shows they operate on a break-even basis.

        As poorly as the franchise has performed, they should absolutely invest every discretionary dollar into the team. Revenues are lower than they would be if they had put better teams on the field in the past.

      • Doug Gray

        I don’t think that the Forbes numbers show that – they’ve shown profit every year but two for the last like 15 years.

      • BK

        Operating Income is NOT Net Income; see “Note 3” in their analysis of the Reds. Their analysis absolutely supports that they operate on a break-even basis.

      • Doug Gray

        Even if we halve it and allow for accounting tricks to make it seem like they’re spending more money than they are, they’ve still made plenty of money in those years. Writing off the owed value of contracts as depreciating assets does wonders for making it seem like you’re doing worse than you actually are.

      • Eddiek957

        Agreed and thank you for this forum

      • BK

        Taxes and Interest are cash expenses. While Depreciation and Amortization are not “cash expenses,” firms that expect to stay in business long-term set money aside for the purposes of future recapitalization of underlying assets for which tax laws allow firms to expense. The Amortization of player contracts you are referring to provides a modest income tax advantage, it’s not a cashflow windfall like the sale of BAMTech is.

        If you look at just the Interest and Tax expenses from the Braves (publicly available), you can find sufficient warrant that the Reds operate on a break-even basis. That’s the best we can do with the available information, but we have more than enough data to determine that “break-even” is the most likely scenario.

        Accounting is not some kind of unregulated field where anything goes.

      • Doug Gray

        Accounting is a field where you can make a lot of things look like they are happening that aren’t actually happening in real life but are allowed by law. That’s their job, but depreciation and amortization is an enormous joke and I will never be convinced otherwise. Being able to say “oh, this is worth less money now so I should be able to claim it on my taxes” is insane. My car is worth less money every single day. So is almost everything I own. Eventually it’s all going to need to be replaced. I can’t write off my shoes, or jeans, or hooded sweatshirts, or tires for my car.

        Color me very skeptical that all of the operating income from Forbes that shows up on the positive side in 13 of the last 15 years was all truly wiped away by taxes and the 2020 year.

      • BK

        Taxes and interest would easily account for the Operating Income on a cash-flow basis alone. Moreover, you will notice in 2019, they showed a $37M operating income. What did the Reds do in the offseason? They raised payroll by $29M (which was more than their operating income had increased). The other years show very narrow operating income when compared to their total revenues.

        Perhaps an example will best illustrate this. Per Forbes, the Reds have about $155M in debt. At the interest rate the Braves are paying, 5.5 percent, that means the Reds are paying $8.5M in interest each year. Interest alone demonstrates the Reds lost money in two additional years and were left with $500K in another year (taxes would easily take them to an actual loss in that year as well). That means they actually lost money in five of the last 10 years. Again, this supports their public statements that they seek to break even each year, and it demonstrates without having to use depreciation or amortization for which you are skeptical.

      • Earmbrister

        Doug, you don’t understand depreciation and amortization. If a company buys a building, for instance, it can’t write off the cost of that building in the first year. The cost of the building is deducted (depreciated) over 40 years as per Generally Accepted Accounting Principles (not income tax depreciation). Conversely, when that same company buys a box of copy paper, it is expensed when purchased, as it doesn’t have long term value.

        Similarly, the cost of a passenger vehicle is deducted (depreciated) over 8 years; you can’t deduct the full cost of the car in the year of purchase.

        If there weren’t established standards for depreciating a long term asset it would be much easier to manipulate a company’s net income.

      • Doug Gray

        I understand it. I just think it’s absolutely fake money saving for rich people.

      • Earmbrister

        Doug, with all due respect, I don’t think you do. Depreciation isn’t “fake money”.

        When you buy a car for say $32,000 is that fake money? Of course not. But, generally speaking, a business can’t take as a business expense the full cost of the car in the year of acquisition. It must be depreciated (expensed) over time. For financial reporting (not income tax reporting) that would be over eight years. Thus the business would have depreciation expense of 1/8 of the cost of the car ($4,000) each year until the car is fully expensed. Income tax rules are different, but the concept is the same.

        When a business buys a building for millions of dollars, it can’t expense it in the year of acquisition. It must be depreciated (expensed) over 40 years.

        If depreciation rules didn’t exist, a business having a very profitable year could easily manipulate its reported net income simply by buying an expensive building late in the year and fully expensing it that year. Depreciation rules prevent that and require assets with long term value to be expensed over much longer periods of time. And land is never depreciated/expensed (it remains on the books as an asset) because it does not lose value over time.

        An easy way of understanding depreciation is looking at the value of a computer. It might be worth a $1,000 when it’s brand new, but you couldn’t sell it for hardly anything 5 years later. Thus, it is depreciated (expensed) over 5 years. At the end of the 5 years, the computer value as an asset has been reduced to zero for financial reporting purposes.

      • MuddyCleats

        Any chance Reds would consider bringing back Drury.

        Not so sure I wouldn’t have tried to extend him instead of trade him this past yr?? Not like Reds had a clear cut better option for 3B in the minors, plus the guy was capable of playing 1B for Votto vs tough LHP. No doubt, cost will b much higher now IF he would even consider it

      • Bill

        From all the data that we can see publicly the Reds are not making massive profits. As BK said they are likely making very little. The problem isn’t that they won’t spend it is that they haven’t made good decisions when they do spend. When you compare revenue from media contracts to the larger clubs like the Dodgers it becomes very clear why the Dodgers can afford $300 million a year.

        Unless the larger market clubs can be convinced to a payroll sharing deal that significantly decreases their chances of winning , the Reds of the world will always have to construct teams smarter. I don’t like it, but it is the reality.

        Everyone on internet forums and blogs can complain all day that Bob needs to sell, but it isn’t leading to a bigger payroll. These billionaires didn’t get their money by operating on a loss every year. The best you can hope for is Bob sells to someone who will hire some experts and stay out of the way

  3. Bdh

    That group wasn’t going to win anything though. 2020 was the best shot

    That season they had a rotation with ridiculous talent (Bauer, Castillo, Gray, Mahle, Desclefani/Miley)

    And a lineup that should’ve produce way more than it ever did
    (Winker, Castellanos, Votto, Suarez, Moustakas)

    But that season they had to rally at the end of the year to sneak into an expanded playoff only to not score a run vs the Braves.

    The current teardown was likely the right move especially after Castellanos opted out of his contract and then turned down the qualifying offer (that decision may have helped the reds afford Collier). Glad the reds didn’t pay Castellanos $20mil to have this season with his worst OPS+ since his rookie year. Really glad I don’t have to see the reds pay him $20 million for how he’ll play 5 years from now at the tail end of his career. Same goes for the rest of the players who are gone from that group minus Castillo but the return makes that one easier to swallow.

    • Greenfield Red

      Bdh, I agree with this. I want the Reds to win the Series again in my lifetime. Maybe twice. I think it can happen. The foundation is now there. They need to continue to build it, and it looks like they will with high draft picks this year and another strong international class in 23.

      The one place I think they could spend money in 23 is on a couple of high end short term free agents with the idea of trading them in August. Why not offer Judge 1 year at 40 million. Look what SD gave for Soto last deadline. That would be nice to have in Cincinnati’s system to go with what’s already here. It may satisfy the “win now” fans and those of us who want them to keep their powder dry for another year when the 2 non productive expensive contracts fall off and all that young talent is one year closer.

      • Droslovinia

        I continue to be irked at the idea of signing players to longer contracts so you can pay them over time for what they bring to the team, only to whine about their being “non-productive” while the team is making good on what they owe them for the past. Of course, it’s even worse to risk large sums on people base on what you hope they might someday do, only to discover you’ve been had. Seems like the Reds have one of each right now.

      • Greenfield Red

        I agree Dro. I am on record as being against the Votto contract just as I was Griffey. Both those guys had their best years before the big contract and the Reds have won exactly 2 playoff games combined during them.

        What they are doing, if they stay the course, is the way to go IMO.

  4. Old Big Ed

    I think that the Reds will at least make competitive bids on a veteran pitcher to serve as a mentor for last year’s 3 rookie starters. Cueto has been discussed, but Wade Miley would work, as well. Cueto would want more than one year, and I think the Reds would do that. Now, if another team wants to give Cueto 3 years @ $15m/year, then the Reds will get outbid. But I think the Reds will give it an honest chance.

    I don’t subscribe to the theory that Krall and the Castillinis are idiots. Krall knows (1) that he gets Moose and likely much of Votto’s deal off the books after this year, and (2) that he has a strong array of prospects due to arrive in 2023 (EDLC and perhaps McLain) and 2024 (Marte, maybe, plus some others); (3) that he also has nobody on the current roster who is going to have a big salary in 2025; and (4) that he has 3 potentially excellent young starting pitchers under team control through at least 2027.

    So, Krall has money to spend, even if he won’t spend it on an elite free agent. The Reds are longshots to contend in 2023, but they can sign a Cueto, Miley or similar pitcher as a bridge to 2024.

    The Reds franchise is worth a TON more if it is both winning and churning out the cash flow. Yeah, they can cash-flow with low budgets and 78-win seasons, but the Castillinis and their partners will make a lot more money by selling a good team and good business than they would a bad team with marginal cash flow.

    The Reds are poised to have a dynamic young team in 2024-26 with very low payroll, which gives them the chance to fill in some holes with legitimate free agents. So, I think the smart business move is to sign maybe a 2-year + option contract with a veteran pitcher, or perhaps an outfielder, to help the young pitchers and to give themselves a head start on 2024. Having a team in 2023 that is clearly improving will help ownership, and that is why they will at least try to sign a mid-level free agent.

    And I think that they will try to extend Stephenson for much the same reasons, once they are convinced over the next few weeks that he has recovered from his injury. It is the smart move, like Tesio approaching Barzini.

    For that matter, I expect them to sign EDLC to a Ronald Acuna or Wander Franco-type contract, as well.

    • DX

      spot on, finally this team is being rebuilt the right way.

    • Doc

      A sane analysis with sound reasoning, unlike the vast majority of the FO bashing, sell it Bob, comments that have no sound business reasoning , nor any reasoning, given for that matter. And it is a business. One wonders how many of the sell it Bob crowd put their own houses on the market at the low points in the market when they don’t have to. Only those in distress is my guess. BC is not in distress, and he appears to be a much smarter business man than those who rail from the heart rather than the head.

      Kyle Farmer failed to mention a very important caveat. Players want to play in Cincinnati, AS LONG AS IT DOESN’T RESULT IN TAKING LESS MONEY. Castellanos could have played here another year, but he decided not for a measly $18+MM, or another two years, but he decided not for the chump change amount of $32+MM. Farmer is full of it. These players could have all the money they would ever need playing here, but they only do it as a last resort and get out as quickly as they can when more money is on the table, isn’t that right NC?

      • TR

        As a lifelong Reds fan, I’m sorry if I upset you with my criticism of the current managing ownership and FO. It’s just an opinion on this fine blog and means nothing.

    • Redsvol

      Solid points old big Ed. I personally don’t think they will sign anyone if significance this off season but will next. Problem is, free agent class for next year is worthless compared to the class this year.

      I hope for a solid veteran outfielder and pitcher but I really think krall wants to give every opportunity to the young guys to establish themselves this year. I hope they sprinkle in some mid level free agents but a combination of them not wanting to spend big $ this year and potential free agents thinking “why would I want to play there” makes it tough for me to see it this year.

    • Frank White

      Not a single move the last 2 years has been made to improve the team that takes the field everyday. Now we are supposed to believe Krall has a clue? They lost 100 games this year which you almost have to be trying to accomplish now days. They have never had a consistent winner. The manager is the worst in the league (numbers back that statement) and gets an extension in the middle of a meltdown. Tone deaf. He lacks personality, vision, winning experience and just about every quality a manager needs to be successful. We have seen it w our own eyes that you are telling us isnt the case. Absolutely NOTHING has been done to get the fans behind this team. They seem like they try to lose fans everytime there is a Reds headline. Kyle Farmer trade is a perfect example of ownership thinking its fun to aggravate fans. It was completely unnecessary just like letting Wade Miley walk for no return. We see them trading good players for minor leaguers not in another teams top 20 prospect list. The organization is 10 years behind the rest of the league. Nothing has been done correctly, its an absolute joke people defend ANYTHING about this organization.

  5. Mark Moore

    I read this an the echoes of what I consider the “mythical small-market team woes” come quickly to mind. I don’t buy it given what we see in other similar or even smaller markets. I think you nailed it, Doug. It’s a choice not only not to compete, but not even to appear like they are trying. Very sad indeed.

    Sell it, Bob & Phil. Take your cash and fade away like a summer sunset. Let somebody like Mark Cuban who knows how to choose a winning attitude take over.

    • west larry

      I would love to see Mark Cuban buy this team, if the other owners would let him in, OBG provided an excellent outline of how we could add a Cueto and/or Miley on a one- or two-year deal. The reds should have about 15-20 million to spend, they should also cut Moose in the spring, why have that meatloaf on the bench, I would like to see the f Troup in the outfield another year to see which of them improve, Go reds! At least make an effort to try to improve in 2023.

      • Mark Moore

        “Meatloaf” … now you’ve added a 4th “M” to the mix. Thanks for that. 😀

  6. Michael E

    Many of my favorite teams seem to have lots of fans just happy to be competitive. I am not. I’d rather stink for a couple of years and be title contenders a couple of years rather than being .500 all the time. I want to see a team that others fear to play, not a team that makes the playoffs, but is otherwise laughed at (either terrible rotation or terrible bullpen or terrible hitting, etc).

    My college alma mater is struggling and way too man fellow fans are stating we can’t really compete for titles, and that they would be happy with 6-7 wins every year. NOT ME. Making some far-flung Toilet Bowl in some place I’ve never heard of playing a team I’ve never heard of that is also 6-6 is not my idea of success, more like a testament to failure. It’s like the embarrassing participation trophies that became the norm the past 20+ years in youth sports.

    The reality is, the Castellini Cartel is NOT spending money this off-season. If they do, it will be completely wrong, as in signing another 5.00 ERA pitching to a ludicrous contract (Mike Minor) as if throwing some bread crumbs to fans.

    I can at least see a bit of wisdom in not spending and waiting out Votto/Moose deals, especially if they lost considerable money in Covid season and the season after. All that said, we know that each day Bob Castellini gets wealthier by thousand(s) of dollars just by the Reds franchise appreciating upward (already over a billion). He and the owners are rich, but the actual cash flow might be tight.

    I like many hope he sells and we get a fresh take, but unless a multi-billionaire outside buyer comes swooping in, we’re gonna get another miserly owner methinks.

    • Old Big Ed

      Nah, I think that other than the major market teams, baseball franchises have hit their peak. Anybody who has $1 billion to buy a baseball franchise can find a lot of better investments. The customer demographic is aging; the games are too long and have too little action for the modern audiences; the business has been hurt by cord-cutting; the best American athletes do not play baseball any more; and there is just little prospect for the cash-flow of a team like the Royals to justify any major growth in franchise value.

      I see no reason to think the Reds’ franchise is actually appreciating in value. People need to get the Forbes reports out and comb through the footnotes, and through the footnotes of the source reports for the Forbes article. What they show is that 25-30% of the Reds’ value is from the franchise’s share of the MLB technology investments (of which BAMTech was only one) and from the proceeds of the sale of the Nationals to the Lerner family for $450 million back in 2006.

      The Reds’ share of this investment pool is a classic non-operating asset. It’s on the books, but its use is unavailable to the Reds on an operational basis. The actual value of the operating business of the Reds franchise (i.e., baseball itself) is far less than $1 billion.

      Under the existing rules, if you want to follow a team that is going to have a chance to win it all half the time, then you need to follow the Yankees, Dodgers, Red Sox, etc. (Or in college football, Ohio State, Alabama, etc.) These teams can all buy talent to cover up mistakes. The Royals and Pirates or Vanderbilt and Indiana can’t. They have to be smarter than the big teams. It isn’t impossible over a short run, but you have to expect some dry spells.

      • MBS

        I don’t think they’ve hit their peak. The thing about sports is most people want to watch them live, instead of how people watch tv series where they binge watch them. That keeps them attractive for advertisements, which will continue to increasing their value year after year.

      • BK

        Good points. I will also point out that MLB’s franchise values are growing slower than the NFL and NBA (I don’t follow NHL). So, if someone wants to own a sports team, they probably look elsewhere unless they have a local tie.

      • Frank White

        So you are saying they should sell the team because they cannot afford to keep up. Thats what youre saying. This organization is going nowhere fast. Free De La Cruz! He is too good to be playing where winning comes after financial gain.

  7. LDS

    Imagine a corporate CEO diverting money from the sale of corporate assets into his own pockets. How would that work out?

    • DX

      If he owns the corporation then they are his assets to sell. He would pay taxes. Whats your point?

      • Frank White

        We get it, youre an accountant. Leave the baseball talk to baseball fans.

    • Old Big Ed

      I expect that the Reds used the $30 million distributed by MLB as to the BAMTech transaction to pay down debt, including specifically any debt incurred in 2020.

      If the Reds did distribute the money amongst the partners, then the distribution would have done in accordance with the partnership agreement and with accepted accounting practices, and each partner would assume responsibility for paying taxes on their distribution. The accounting firms hired by the Reds would not allow Castillini to pull any shenanigans, because (1) the accounting firm does not want or need any part of any client’s illegal acts; (2) MLB can audit teams’ finances and force owners to sell for crooked accounting; and (3) his partners, who are all themselves very wealthy, would sue Castillini into oblivion.

    • LDS

      Castellini and the partnership group are certainly not trying to run the Reds as a thriving business. Legal? Maybe. Ethical? Not a chance. I’ve been through a bunch of audits in my career and failure to invest, typically in a product or division that was subsequently eliminated, has always raised red flags.

      • Earmbrister

        LDS, you lost me with your audit red flag comment. Do you care to explain?

      • Old Big Ed

        Paying players of the ilk of Moustakas $64 million is not an “investment.” It is an unnecessary expense.

        The current ownership has spent money. They did a massive contract with Votto; extended Phillips; extended Bailey; signed Akiyama, Moustakas and Castellano for the same team; traded for Mike Minor; paid Bauer, Gray and other pitchers. They just have been stupid about it. The biggest difference between now and 2008-2020 is that ownership has apparently decided to quit spending money stupidly.

        Paying $175 million for 5 years of Jacob DeGrom is too risky for the Reds’ revenue level, and it would be stupid for the Reds to enter into that contract. Paying $16 million for two years of Johnny Cueto is not too risky, and they should offer something in that range to him.

        As I’ve said, the franchise is worth a TON more if ownership can show it is competently run, with a good farm system and few long-term payroll anchors. Cleveland and Tampa are both run with two general themes: (1) have a great minor league system, and (2) avoid long-term commitments to guys in their 30s. This is exactly what the Reds have needed to do for 15 years (if not 30 years), and now they are finally doing it.

        Castellini stumbled into a good start, with Votto, Bruce, Cueto, Bailey etc. He misinterpreted his good luck as Walt Jocketty’s being worth listening to, when Jocketty was well past his prime. As a result, they waited too long to dismantle the team that Dusty had; they let their farm system wither; and they continued the Reds’ long-term failure to sign and develop Latin American players (and particularly hitters).

        They started doing better under Dick Williams, but still made the ridiculous Moustakas/Akiyama signings ($88 million down the drain). Then Covid came. With a top-heavy team and little clarity on revenue, the Reds have been forced to do now what a top GM would have told them to do 15 years ago.

        I speculate (but certainly do not know) that the financial problems at Bally Sports may have had something to do with the all-in rebuild that started in the 2021-22 offseason. MLB now seems to have a plan on Bally Sports, but in February 2022 there was a distinct possibility that the Reds local broadcast rights would be nullified and re-bid.

      • VaRedsFan

        @BigEd…100% agree….nailed it.

  8. Reaganspad

    I would spend 30 million/year right now on 2 @ 2 year contracts for Cueto and Conforto. Conforto with the 2nd year opt out.

  9. BK

    First, if the players want to stay here, play better! They were knocked out of the playoffs without a win in 2020. They faded badly in 2021 and missed the playoffs. There were slightly above average and no better. Winning teams have the incentive to keep their players, mediocre teams don’t share the same incentive.

    As others have stated, the Reds need to stick with their strategy. If a FA can help them long-term, sign them. If they are likely to bring back even a modest return at the trade deadline, sign them. Otherwise, 2023 is a year for “sorting.” I want to see the Reds compete every year, too. But signing FAs to build a mediocre roster is one of the contributing factors to where the Reds are now. Lots of MLB teams have big payrolls and poor-performing teams (e.g., Red Sox, Angels).

    • Greenfield Red

      BK you and I are in agreement. There is about 40m of bad money to be spent this year on at least 1 guy who will be in the lineup every day he is healthy regardless of his results. There is another who will be also if they don’t get rid of him all together. Unless they are willing to spend another 120 mil this year for 5 or 6 big free agents, it would be a waste of money on a team with no shot at winning.

      Although, I floated the idea of signing Judge for 1 year 40 million with 4 more at 24 mil each with annual opt outs. How many HRs can he hit in GABP in half a season before he is traded to a contender? That would be interesting.

  10. BK

    Doug, I suggest you put on your GM hat and craft an article showing how you would build the Reds for the 2023 season on a $120M payroll.

  11. Jeffrey Oakley

    More of the same from x-Reds players. What does this say about the organization? Maybe the day to day guys are OK but the glaring issue is the carneys that own the team. Why can’t they take their return on investment( bought team for 340, it is worth over a billion now) and their share of the Disney sale and get outta town! Hey Phil, I bet someone would love to have a storied franchise in a baseball town. By the way, selling the lake house in Williamstown is bringing a half a million. How much more do you need?

  12. Larry Baker

    Some nice comments on the Reds future. Most of the comments are from fans who want to win and build a good team. Sadly, the Reds ownership are not on the same page. Just don’t see the Reds ownership going crazy spending money. When the Votto/Moose contracts comes off the books, don’t see the Reds using all the extra dollars on free agents. Not sure what top free agent would sign with the Reds that’s looking to play for a championship. The free agents looking at the Reds would be just looking for a paycheck. Sign with the Reds to have a job in baseball and keep the career going. The Reds spend some money on the last playoff team. The team came up short. After getting beat by the Braves, ownership started the cut the budget agenda. No more spending big dollars on free agents. The agenda has been to keep cutting the budget. How low will the Reds go in the future budgets. Just don’t see the Reds spending money again like for the last playoff team. Something to keep a eye on. Will the Reds make any efforts on signing some of the younger players to long-term contracts. Signing young players to extra years will take a GM that understands and can judge talent. The Reds must always manage the money they have in the budget in a good way. No mistakes.

  13. TR

    The sentiment expressed by Kyle Farmer has been around for quite awhile going back to the days before the electronic media when the way to communicate sentiments about the Reds was a letter to one of the editors of Cincy’s three newspapers at that time. Cincinnati is big but not that big and a nice place for a player to have his family with him during the season if desired. That’s still a factor but the game today is dominated by great amounts of money for players a team wants to keep long-term. That has greatly lessened a players attachment to where he works.