Mark Lerner: Nationals payroll ‘beyond topped out’

(Jonathan Newton / The Washington Post)

(Jonathan Newton / The Washington Post)

The Nationals do not possess room in their budget to add salary during this season and the team will proceed “smartly” with future payrolls, Principal Owner Mark Lerner said before today’s Nationals Park opener, addressing reporters for the first time since last season.

The Nationals entered opening day with a $134.7 million payroll, according to figures from the Associated Press, ninth in the majors and an increase of roughly $25 million from last season.

“We’re beyond topped out,” Lerner said. “Our payroll has skyrocketed to like $140 million. It’s in the papers. I don’t think we can go much further with the revenue streams that we have.”

Upon buying the franchise in 2006, which came with a $611 million investment from the city for a new stadium, Lerner called the franchise “a public trust” and said the family would not take profit out of the business for 10 years. Today, Lerner said the Nationals will be cautious in their spending based on revenue.

“We take it one at a time,” Lerner said. “We’ll look at it after the season as far as what we can do. We went into this thing, it’s a business. We’ve got to run it smartly. We’re not going to do something where we’re losing tens of millions of dollars a year. Anybody can understand that. We’re going to be smart.”

In late March, Forbes magazine valued the Nationals at $700 million, up from $631 million the year before. Ted Lerner, the patriarch of the Nationals’ ownership group, has a net worth of $4 billion, according to Forbes, which makes the second-wealthiest owner in baseball. Nationals Park drew 2.65 million fans in 2013, 11th in the majors.

The Nationals’ future revenue, and therefore their future payroll, may be determined by stalled negotiations over their television rights fee contract with MASN. As revenue from local rights deals has exploded in recent years, the Nationals have been stuck in a bitter dispute with Peter Angelos, the owner of the Baltimore Orioles and the majority owner of MASN.

The Nationals have fought for years to increase the money received from the network, and Angelos has dug in. The case rests with Commissioner Bud Selig, who at the 2012 All-Star Game said he thought the matter would have been settled six months earlier.

“We’ll keep going down the road with him until we get something resolved that works for both parties,” Lerner said. “We certainly have to be careful with our projections and how we’re going to spend money, our budget. We have to budget smartly. If we get a better contract one day, and we can use those funds to do more things, great. Right now, we don’t have anything other than what we’re currently getting, and we’re budgeting accordingly.”

The Nationals could also add to their revenue by selling naming rights to Nationals Park. Experts have estimated the Nationals could fetch $10 million a year. But they have not felt pressure to sell them.

“Now isn’t the time to start looking,” Lerner said. “We haven’t actively been looking in the past few years. If something starts to happen, that’s great. It’s not really the time, though. It’s nice to have it. It’s not something we’re rushing to do. The great thing about the way we’ve approached it, we’ve kept all of our major naming rights opportunities in the stadium – all the levels, the gates, the center field plaza. We still have all our inventory.”

In November, Mayor Vincent C. Gray said Ted Lerner pitched him on a retractable roof for Nationals Park, an idea the city rejected. Mark Lerner said today the team broached the idea, but never reached the point of requesting the roof.

“We really weren’t pursuing it,” Mark Lerner said. “I think that’s where everybody got confused. My dad was sitting with a group from the city and was throwing around ideas. How can we make the park better? And the idea came up, how about putting a roof on it? We’ve got all kinds of events here. But we didn’t specifically ask for a roof. I think that’s where it got a little bit out of whack.”

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