Something to keep in mind, as we talk about the Rangers, the ownership situation, and what payroll should be, versus what it is and has been...
Coming into the 2009 season, the Rangers had a sustained run of significant positive results in terms of operating income*.
* Defined as EBITDA by Forbes.
Looking at Maury Brown's excellent website, he has charts summarizing the Forbes data on each franchise from 2002-2009.
The numbers come out in April, so each year is dealing with the operating income from the prior year. April, 2005, has income for 2004. So, understanding that...
For 2004, the Rangers had an operating income of $2.9 million.
For 2005, the Rangers had an operating income of $24.7 million -- 6th highest in the majors.
For 2006, the Rangers had an operating income of $11.2 million.
For 2007, the Rangers had an operating income of $17.2 million.
For 2008, the Rangers had an operating income of $17.4 million.
This is with a team that, throughout that period, wasn't competitive, wasn't drawing well, and had crappy ratings.
No wonder Tom Hicks is so desperate to find a way to buy the team from Hicks Sports Group...if he can uncouple it from the disastrous leveraging he did within the HSG entity, particularly in connection with the Liverpool purchase, the team can be financially successful. Hicks probably figures that if he can get the team away from HSG, he can adopt the Florida model of maintaining low payrolls and not really trying that hard to compete, while maintaining profitability through mediocre attendance and MLB's other revenue streams.
Fortunately for Rangers fans, it sounds like Hicks isn't going to be given the chance to continue to oversee the Rangers. It sounds like there's going to be a new ownership group coming in, one that hoping is going to be committed to winning, rather than continuing to tread mediocre water while feeding at the MLB general revenue trough.
Regardless, though, there's no reason why this team, in 2010, shouldn't be able to support at least an $80 million payroll. The fact that this front office is being handcuffed this offseason because of the financial ineptitude of Tom Hicks is one last kick in the nuts to those of us who have stayed loyal this past decade as he heads out the door.
But that being said, there's also no excuse, given the team's situation and the window of opportunity that is opening, for the Rangers not to have a payroll that is back in the upper half in the next couple of years. This is a team that looks like it can do something really special in the coming years, and it deserves an ownership that is willing to commit financially to help add the pieces necessary to turn the potentiality of something special into reality.