Major League Baseball went on as scheduled Friday, as the owners and players agreed to a four-year contract - the first time in more than 30 years the two sides avoided a work stoppage in labor negotiations.

        Neither side declared victory. “It's not important today to talk about winning and losing,” said commissioner Bud Selig.

        The owners got the framework of what they wanted most: a new machinery to shift more revenue from the richest clubs to the poorest. “I think we've made it clear all along the issue was competitive balance,” Mr. Selig said. “I feel this deal clearly deals with that.”

        The players got that framework on terms they could accept: a system that won't be too taxing on rich teams and will still allow payrolls to grow as baseball's revenues grow. “We believe this is an agreement we can live with,” said Don Fehr, executive director of the players' union. “Otherwise, we wouldn't have made it.”

        The owners also agreed to postpone contraction until at least 2007. This opens the door to relocating franchises - the most likely move being the Montreal Expos to Washington D.C.

        “I think baseball's the winner here,” said former commissioner Fay Vincent. “Is it going to fix the problems? I'm not sure. I don't think so. (But) it's much better than a work stoppage. A stoppage would have really hurt baseball very badly.”

        The sides had been negotiating furiously since Monday trying to head off a strike. The final stretch of meetings began Thursday morning and continued through the night and into the morning. Players were told by the union not to show up at ballparks for Friday's games unless an agreement had been reached. Many teams delayed travel pending word on an agreement, and there was talk early Friday that the day's first game - at 3:20 p.m. EDT between the Cardinals and Cubs in Chicago - would be delayed until the evening to give the two sides time to cut a deal.

        Both sides seemed elated that the agreement was reached without locking out fans.

        “I think there were a lot of people who never believed they'd live long enough to see these two parties come together, make a very meaningful deal and do it without one game of work stoppage,” Mr. Selig said.

        Players and owners both need to ratify the agreement. Those votes will be conducted sometime next week. Reds owner Carl Lindner said he is happy with the agreement.

        “While I don't know what the specific terms will be yet, I am excited to turn our attention to the game and our new ballpark,” Mr. Lindner said. “I do think the agreement will help restore the fans' faith in the game.”

        As part of the agreement, high-revenue teams will have to share 34 percent of their locally generated money, up from 20 percent. An additional $72.2 million will be taken each year from the central fund and distributed to lower-revenue teams, and the commissioner will be given a $10 million discretionary fund.

        A tax will be levied on high- payroll teams to discourage spending. Portions of payrolls will be taxed, with the threshold starting at $117 million next year and rising to $120.5 million in 2004, $128 million in 2005 and $136.5 million in 2006. The rate will be 17.5-40 percent, depending on the season and the number of times a team goes over the threshold.

        Because owners agreed to push the expiration of the deal from Oct. 31 to Dec. 19 in 2006, there could be a tax-free year in 2007 - if the sides can't quickly reach a new agreement.

        For the first time, players agreed to mandatory testing for steroids, which will start next year on a survey basis. The minimum salary will rise next year from $200,000 to $300,000. The key to the deal appeared to be the luxury tax. The union originally opposed it as a form of salary cap. Since 1995, as baseball's revenues have risen, so have team payrolls, and the union wanted to make sure that would happen in the future, as well. After agreeing to the tax in principle, the union wanted it structured to affect as few teams as possible. The last labor agreement contained a weak version of the tax, and expired after three years.

        Based on 2002 payrolls, the tax in the new contract would affect just three teams 1/2ndash 3/4 the New York Yankees, the Texas Rangers and the Los Angeles Dodgers. Those teams together would pay about $12 million in taxes. Another four teams within $7 million of the threshold.

        Experts say at those levels, the tax will discourage the very top teams from spending too much on payroll, but may not do much to change baseball's overall salary structure - something the owners wanted and the union fought.

        “It remains to be seen whether the disparity between the big-market teams and the small-market teams is really going to be eliminated enough to solve the problems,” said Bruce K. Johnson, a sports economist at Centre College in Danville, Ky.

        The tax “is going to hurt at least a couple of top-market teams,” said Sal Galatioto, head of the sports practice at Lehman Brothers investment bankers in New York. But it's important, he said, that the teams receiving the money spend it wisely.

        He points to Jerry McMorris, owner of the Colorado Rockies. He gave contracts worth more than $200 million to pitchers Denny Neagle and Mike Hampton, who are a combined 14-22 this year. “What's to stop (McMorris) and other people like him from continuing to do stupid things like that? You can't legislate that,” Galatioto said.

        He added that the revenue sharing may not be enough to help some franchises. “Even if you gave Montreal $25 million in revenue sharing, they're still not a viable franchise,” Mr. Galatioto said. “The same thing could be said of the Florida Marlins, and some other teams ... Unless you can give them $60 million in revenue, it's not going to work, and you can't possibly do that.”

        Likely winners are well-run mid-market teams such as the Oakland A's, St. Louis Cardinals, Houston Astros and Cincinnati Reds, said Doug Pappas, chairman of the “business of baseball” committee for the Society for American Baseball Research.

        They'll benefit because they'll get some revenue to help them climb the talent ladder, and the richer teams will lose revenue and give up talent.

        “I think Oakland can start clearing space on its shelf for the next five AL West titles,” Pappas said.

        What did the players get in this contract? On the surface, not much besides an increase in the minimum payroll, Johnson said.

        “It could be that (the players) believe the revenue sharing and the luxury tax won't really have that big an impact on player salaries,” he said. “If they really believe that and they're right, then you really are going to see these issues boil up again” when the contract expires in 2006.

        Overall, “You'd have to call it kind of a draw,” said Lawrence Hadley, a sports economist at the University of Dayton. “It sounds like the owners got some of what they wanted, and the players got some of what they wanted.”

        Cliff Peale and the Associated Press contributed to this report.

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