Major League Baseball is proposing a salary cap for players, the first since 1994

MLB owners submitted a salary cap proposal to the players’ association, reviving a system the union has pledged never to accept. The proposal would limit 2027 spending to $245.3 million and set a payroll floor at $171.2 million, requiring some teams to spend more. The cap calculation would use luxury tax payroll figures that include $20.1 million for benefits and a pre-arbitration bonus pool. Owners also discussed a phase-in schedule and an escrow mechanism within a proposed seven-year deal. Current contracts would remain guaranteed, and the plan would not ban guaranteed contracts. MLB would centralize local media revenue and split it equally, while shifting to a 50-50 revenue split with players and eliminating the existing club revenue-sharing plan.

"MLB's proposal would cap spending in 2027 at $245.3 million, using figures for luxury tax payrolls that include $20.1 million for benefits and the pre-arbitration bonus pool. It also would establish a payroll floor of $171.2 million, forcing some teams to spend more. The Los Angeles Dodgers, baseball's biggest spenders, had a $415.2 million payroll on opening day this year - around $170 million over the proposed cap."

"Owners said they would discuss with the union both a phase-in schedule that would give teams like the Dodgers time to comply with the cap and an escrow system as part of a proposed seven-year deal. In an escrow system, a portion of a player's salary is withheld to ensure the agreed-to-revenue split when final figures are accounted for. MLB maintained all current contracts would remain guaranteed and there would be no prohibition of guaranteed contracts under the cap system."

"MLB said it would centralize local media revenue from the 30 teams equally and give players a 50-50 split as part of a proposal that would eliminate the current revenue-sharing plan among the clubs. "Our salary cap and floor proposal levels the playing field while sharing baseball revenue with the players 50/50 as we grow the game together," MLB spokesman Glen Caplin said in a statement. "Further, by sharing media revenue equally as part of our proposal, we can address another top fan concern of local TV blackouts.""

""The cap is pretty much a nonstarter," Pittsburgh outfielder Bryan Reynolds said. Baseball owners hadn't proposed a firm cap since 1994. Their effort prompted a 7 1/2-month strike that forced the cancellation of the World Series for the first time in 90 years."

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