Kevin McClatchy is far removed from the wide-eyed 33-year-old who led a group that bought the Pirates in 1996.

His noted charisma and wit are healthily intact, but he freely allows that the wear of the relentless losing -- 12 years overall for the team and its fans, including three years before McClatchy's arrival -- and the resultant criticism of his stewardship have taken a toll.

Still, he expresses nothing but optimism for the team's future on and off the field, almost defiant in predicting that management will have proved its detractors wrong before he is done on the job.

In an interview at his PNC Park office, McClatchy spoke on a wide range of subjects. The only issue he declined to address is Major League Baseball's steroids controversy, as per a recent edict from Major League Baseball commissioner Bud Selig.

Robin Rombach, Post-Gazette Pittsburgh Pirates owner Kevin McClatchy with the rotunda of PNC Park in the background. Click photo for larger image. This is the first installment of a two-part interview with Pirates CEO and managing general partner Kevin McClatchy. Today: Like it or not, money drives decisions. Tomorrow: How long will he remain on the job? Related coverage Pirates sign Ward for guaranteed $975,000 Pirates Q&A with Paul Meyer

Q: You have stated that the Pirates lost $30 million in the first three years in PNC Park. Did the losses continue in 2004? What is the state of the franchise today?

A: It's much more stable than it was. We're in much better financial shape. We've sort of turned the corner a little bit. We didn't have the losses in 2004. We were able to make some money and pay down some debt.

I think we're in pretty good shape. I think we're going to see attendance go up this year. It's early, but there are some positive signs.

Q: How much of a profit did you make?

A: I wouldn't say it was huge, but it was turning the corner.

Q: Can I pin you on a number there?

A: No, I get in trouble when I do that.

Q: Although your 2005 player payroll is not set, it is expected to end up in the range of $35 million. That would be a little short of what it was in 2000, the final year at Three Rivers Stadium. Given the additional amenities and revenue streams that PNC Park offers, how can that be explained?

A: Actually, I think our payroll will be closer to $40 million.

Our payroll went well above $50 million in 2001, as you know, and we lost a lot of money. Two things happened: Our payroll was going up, and attendance was going down. We lost 100 games that first year in PNC Park. We had things budgeted that year because we expected things to go up. But player and team performance went down, and attendance went with it.

It was a bad combination, and we had to get things back on track.

My anticipation now is that attendance is going to go up this year, and payroll is going to go up. They work together and, unfortunately, they were working apart for two years. That really set us back, so we had to do some things that were tough. But we're taking care of that and we're putting more money into the minor-league system and player development because we think that gives us the best shot of winning.

One player is not going to mean the difference for us getting into the World Series this year. The way we're going to be successful is to develop these young players -- where I think [general manager] Dave Littlefield is doing an excellent job -- and that's where we're putting our resources. We're starting to see some of these prospects getting close. So, lifting the payroll from $40 million to $45 million is not going to make the difference now.

We see cases like Minnesota and Oakland, where the development is there, the teams win and attendance goes up. Our team hasn't done that yet. We have to start winning, and that will take our payroll up.

	THE McCLATCHY FILE Name: Kevin S. McClatchy Age: 41 Born: Sacramento, Calif. Resides: Pittsburgh Education: University of California-Santa Barbara, political science degree Professional: CEO and managing general partner of Pirates since buying team Feb. 14, 1996. ... At age 33, was youngest owner in baseball at the time. ... Only fifth owner since franchise was founded in 1887. ... Member of Major League Baseball's Executive Council. ... Serves on boards of numerous charitable organizations, including Catholic Charities, Roberto Clemente Foundation, Sports City in Puerto Rico, University of Pittsburgh Cancer Institute, Extra Mile Education Foundation and McClatchy Newspapers. ... Began career as sports producer for television station WPLG in Miami. ... Also worked in advertising and marketing departments at Miami Herald. Personal: An avid runner, he completed 2002 Pittsburgh Marathon, raising $90,000 for cancer research. ... Climbed Kilimanjaro, Africa's highest mountain, in early 2003.

Q: Can you envision a scenario in which the payroll would again top $50 million?

A: Yes, I can. All we have to do is win, and people will come out.

Q: There is a cart-and-horse argument there, though. Should the increase in attendance precede the increase in payroll? Or vice versa? Someone could suggest that signing a star would accelerate the winning and attendance.

A: Attendance revenues wouldn't go up at the same rate that adding $15 million to the payroll would. We would, then, end up losing money and putting the franchise in harm's way.

I know people don't want to hear this, but I have a responsibility to make sure the franchise is in good shape. We don't want to allow to happen to the Pirates -- and it won't on my watch --what happened to the Penguins when they went bankrupt five years ago. There were some people in the previous ownership of that organization who were just spending. It felt good at the time, but our city almost lost the hockey team because of it.

Q: Although you do not want to get into specific numbers, would you describe your debt now as manageable?

A: Yeah, I think it is, but we still would like to get it down a little bit.

Q: Is that debt lingering from your cost overruns in building the ballpark?

A: We did have considerable debt as a result of that, but I think we're in good shape now.

And we had to do some tough things to get here. I wasn't going to win Pittsburgher of the year for the things I did, and I understand that. But I feel good about the organization, where it is.

When you see the young players like Oliver Perez, Jason Bay, Jack Wilson, we didn't have that before. You go back a few years, and we had Kevin Young, Pat Meares ... we had a lot of commitments to a lot of salary for unproductive players. People can look at where your payroll was then, being above $50 million, but I might argue that our payroll is more productive now.

I look at the New York Mets. They've finished last or next to last three years in a row, and they're spending $120 million.

People won't see what we're doing until they see John VanBenschoten and Zach Duke and Brad Eldred. When they see these guys, I think people will say, 'Yeah, these guys are doing it the right way.'

Q: The Pirates received $13.3 million under Major League Baseball's revenue sharing in 2003, roughly double the amount of the previous year. That money was not available in previous years. What is the best way to account for this money if the major-league payroll went down? Did it all go in the minors?

A: No, we didn't pour all of it into the system. We have spent more there than we had. Much more. But we're also trying to get the team back afloat, to balance the ship with our debt. We lost a significant amount of money there in a short time.

We don't want this thing to be where Arizona is now. They're sitting in so much debt ...

Q: They have more than $200 million in debt, but spent almost $80 million on free agents last week, right?

A. Right. Come talk to me in a year or two about where Arizona's going to be.

I'm just doing the things I need to do. If it makes me unpopular, then I'll bite that bullet. But when it turns around -- and it will -- we'll have shown that we went down the right path.

		TO OUR READERS Dejan Kovacevic will take over the Pirates' beat for the Post-Gazette beginning Jan. 1. Kovacevic, 38, covered the Penguins and the NHL for the newspaper since 1997, in addition to the Olympics in Athens, Greece, in the summer. He is in his 14th year on the staff. Robert Dvorchak, the Pirates' beat reporter since 2001, will take on the job of sports enterprise reporter, covering a variety of topics and special projects.

Q: In the NHL lockout, we are seeing owners hold fast for a salary cap. If they get it, all four major professional sports will have a cap except baseball. Could you see that applying pressure to produce a more equitable deal when the next labor agreement is negotiated in two years?

A: Yes. I think everybody's looking at the NHL right now. And it's a close watch.

This game is not where it needs to be. We've made a lot of strides in a lot of areas but, after 30 years of mistakes, this thing is not where it needs to be.

There needs to be increased revenue sharing. All you need to do is look at the NFL. The Pittsburgh Steelers get the same check that the New York Giants get. That makes things a lot easier. When I've got somebody outspending me by $150 million, that's tough. I could become a lot more intelligent if I had that extra $150 million each year.

A cap is necessary, too, but I'm not sure a cap is going to happen. It will be something to watch.

Q: Ultimately, do the Pirates need a labor agreement with greater parity to become a World Series contender?

A: Not necessarily. I've seen Oakland get pretty darned close. Minnesota, too. If the stars all align, it can happen.

Is it easy? No.

We can't make mistakes when you're playing within our margins. We've made some mistakes in the past, and I've acknowledged them. We signed some contracts that were mistakes.

Q: Is there any sense of relief -- in the financial sense -- that comes with being able to move Jason Kendall's contract, the last big one on your books? A sense that now the team can move forward?

A: Yeah, there is. I know this is an industry catch-phrase right now, but it's going to give us more flexibility. If somebody was to say you, 'If you could end up with Mark Redman and Matt Lawton for Kendall, would you do it?' You would say 'yes,' getting a No. 3 starter, a leadoff hitter and some more flexibility.

I think it's good for Dave Littlefield, too. Now, this is his team.

Q: In the Kendall and Matt Lawton deals, your team committed to paying its trading partners cash in 2006 and 2007, including $5.5 million to Oakland. Might that negate the revenue boost that comes with the 2006 All-Star Game?

A: No, it's not that significant. If we still had Kendall in 2007, we'd be paying him $13 million instead of less than half that. I don't see that as a problem.

Q: You have described the All-Star Game as a "second wind" for the franchise, a chance to take advantage of increased ticket sales to bring a winning team. Do you have the sense yet that the season-ticket base will be up from the 8,000 of last year?

A: You usually see that the year before the event, so I think we'll see it in 2005. Our season-ticket deposits are up by a third from last year, but we also sent out for them earlier. I can't read too much into it yet.

Q: What went into your decision to keep ticket prices level despite the All-Star lure?

A: I just didn't think it was the right time. I talked to my staff and told them I didn't want an increase.

I've taken my bullets.

Q: A remnant of Bottled Watergate?

A: I still have my scars from that one.