While the debt rule is indeed mysterious, maybe this can shed some light. Disclaimer, I did a lot of math, I'm a graphic designer and it made my brain hurt and could be totally wrong:
This article, from 2011, reveals that the Orioles are/were one of nine teams in violation of the debt rule, which "generally limit[s] a team's debt to 10 times its annual earnings, although Selig has wide latitude to enforce those rules."
But, that list also included the Frank McCourt Dodgers, the post-Maddoff Mets, the Cubs, the Tigers, the Marlins, the Phillies, the Rangers, and the Nationals. So some of those teams were in bad financial situations - but the Rangers, Phillies, and Tigers sure were spending. Two years later, the Dodgers, although with new owners, have a huge payroll.
If you check out the MLB agreement on Page 208 , it defines the Debt Service Rule as:
"The Rule. No Club may maintain more Total Club Debt than can reasonably be supported by its EBITDA. A Club’s Total Club Debt cannot reasonably be supported by its EBITDA if Total Club Debt exceeds the product of that Club’s EBITDA during the most recent year multiplied by the EBITDA Multiplier applicable to that Club."
EBITDA means a team's earnings for it's fiscal year, before interest, taxes, depreciation and amortization. In 2011, it was $25.5 million.
So the formula for the Debt Rule is [EBITDA] x [EBITDA Multiplier] = [>Total Club Debt]. The EBITDA Multiplier is 8, but if you have incurred debt for a stadium pr renovations in the last ten years, the club can use a multiplier of 12.
So, doing the math: [25.5] x  = 204m or [25.5] x  = 306m.
From that rough estimating, we can guess that at best, in 2011, the Orioles had $205m of debt, but I imagine that the renovations to the park for the 2012 season were probably paid for in 2011 and might get them a multiplier of twelve.
Here are the 2011 numbers for the other, competitive teams violating the debt rule:
Phillies: [EBITDA: 8.9M] x [8/12] = $71.2 / $106.8M
Rangers: [EBITDA: 22.6M] x [8/12] = $180.8M / $271.2M
Tigers: [EBITDA: -29.1M] x [8/12] = $232.8M / $349.2M
Nationals: [EBITDA: 36.6M] x [8/12] = $292.8M / $439.2
Then there is the MASN-CASH-MONEY. According to Forbes, the Orioles own 87% and the Nationals own 13%. Currently the Orioles and Nationals are before a MLB Arbiter regarding shares of the network. Angelos is willing to give the Nationals a 20% increase - which would be $35 million a year. However, the Nationals want more than $100m annually.
So, if $35 million a year accounts for 20% of the MASN pie - that roughly means the entire pie is worth $175 million. Which is really nothing at all, considering the multi-billion dollar deals teams are making with Fox Sports. And that is not even counting the money that goes back into MASN to keep it running. It has expenses too. Plus, let's just say, if a MLB arbiter is possibly about to decide to to cut the stake 50/50, Angelos can't hit the red button and send piles of endless cash that doesn't exist from the MASN vault straight into the warehouse.
So, I think we can gather this:
1. MASN is kind of a liability. I almost get the feeling they could make more signing a Fox Sports Deal then possibly split a small pie with the Nationals, which certainly looks like what might happen, if Angelos' is willing to allow a 20% increase for the Nationals to a 33% stake as his starting offer. Is MASN just mismanaged? The DC/Baltimore Metro Area is pretty big, it has to bring in more money than it does.
2. Last year, the O's revenue was $206m. While a different league, NFL owners said during the lockout that 50% went to players and the other 50% went to debt, stadium, staff costs, training facilities, etc. I imagine that MLB is similar and the Orioles rumored payroll is $100m, which is about right.
3. Angelos is 84 and not immortal. He either has to be planning now to sell the team or give it to his sons. Either way, that is a huge tax bill and perhaps Angelos is positioning profit from the team to pay it. It's expensive to die.
4. Clearly, the debt rule violation hasn't stopped the other teams above from spending, so that in and of itself does not seem to be an issue, unless the Orioles have some sort of obscene debt crisis, which I really doubt.
5. There are so many expenses that we don't even think about - like when Duquette claims some player in June for $500k, we all go "Aw cool, whatever, cheap, low-cost, depth move." That's still a lot of money. I'm debating now to get a Little Caesers $5 pizza against Pizza Hut, so that's my life right now.
5. Just a thought - I was talking to my grandpa the other day. He's 92 and big Baltimore sports fan. We were talking about the Ravens season and his kids, my uncles, were expressing frustration the Ravens didn't make the playoffs. And my grandfather wisely said, "It was an enjoyable season. Winning isn't the only reason the games are played." And he's right. We have a homegrown team right now that is competitive, fun to watch, with what it seems to be some pretty good people who are active in the community. This isn't some bought machine like the 96/97 teams or what the Dodgers have of mega-millionares. Winning is fun, sure. But, I was six when the Orioles were last good in 97 and I can hardly remember it. I didn't grow up loving baseball because of winning. I grew up loving baseball because of the game, the experiences I have with family and friends watching it, and playing it through school and pickup games now. Let's not lose focus of that.
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