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Eric Fisher | Minor League Baseball franchise reduction could result in major changes

Major League Baseball wants to reduce the number of affiliated teams in Minor League Baseball by 25 per cent. SportBusiness' Eric Fisher looks at what is driving the decision.

Eric Fisher

Amid the various strategies for a building a successful sports property, there are at least a few basic, widely understood truths.

Nearly every property wants to do better with its grassroots marketing, and appeal more to families and children in order to help develop the next generation of fans. And it’s widely held that at least in the United States, if the not the entire world, Minor League Baseball is a bona fide leader in both of those areas.

So why would Major League Baseball want to dramatically reduce that?

MLB is already facing a multitude of troubling issues, including the ongoing Houston Astros electronic sign stealing investigation, growing questions over the integrity of the Rawlings-made ball used in play, and heightening labor tensions with the MLB Players Association. Now it has another firestorm on its hands with its proposal to dramatically overhaul the affiliated minor leagues.

The league’s proposal, part of ongoing Professional Baseball Agreement negotiations with MiLB, contains several key elements: a 25-per-cent reduction in affiliated clubs from 160 to 118, a broad geographic realignment that would change the classification level of some of the remaining teams, and sizable shifts in how individual MLB and MiLB teams reach affiliation agreements with each other.

MLB commissioner Rob Manfred says the key drivers beyond the proposed overhaul stem heavily from a desire to improve facility conditions around the affiliated minors, as well as reduce long road trips for prospects. MLB also argues there are already too many players in the affiliated system and suggested that minor league team owners are not willing to invest properly in improving their ballparks.

“I’m now sure why Major League Baseball should pay to fix a facility that the minor-league operators tell you can’t be fixed,” Manfred said. “It doesn’t make a lot of sense from our perspective, so we thought about an alternative.”

MiLB stridently denies any accusations of intransigence and says their clubs have been and remaining willing to discuss facility improvements. There is little debate, though, that some minor league stadiums are indeed much worse for players than the high schools from which they just arrived, and that league alignments can be improved.

Both sides would additionally like to fix much of the current affiliation process, which includes biennial contract renewals and is akin to a virtual game of musical chairs where the last clubs standing on each side are forced into alignment with each other.

All these elements, though, operate largely within the prism of baseball operations and player development. Not nearly enough consideration in the debate has been given to the business components of the overhaul, particularly fan development given MLB has fallen in attendance six of the last seven years and still faces challenges with national TV ratings.

MLB’s proposal is estimated to save its 30 clubs a combined $20m in annual operating costs. But that figure pales in comparison to the projected quarter of a billion dollars in franchise value the 42 minor league team owners would collectively lose by seeing their big-league affiliations vanish.

A proposed independent “Dream League” for those affected franchises is widely seen as a non-starter, likened by MiLB to a “death sentence” in those communities. It is expected many of those clubs would soon fold, as the pathway and connection to the big leagues is a fundamental part of what the franchises offer to fans.

Manfred, meanwhile, has also said many of the minor league clubs targeted to remove their affiliations have not been significant attendance drivers. But relative to the size of their smaller communities, those clubs often more than hold their own.

The Binghamton (New York) Rumble Ponies, for example, are just one of four Class AA franchises on the list of targeted clubs, and ranked last in the Eastern League this year with an average attendance of 3,000 per game. But that figure represents 1.2 per cent of Binghamton’s metro-area population. Several MLB clubs including the Seattle Mariners, Tampa Bay Rays, Detroit Tigers, and even the Boston Red Sox draw much less than one per cent of their respective metro-area populations on a per-game basis.

Then there is the youth aspect. Arguably the greatest achievement of Manfred’s five-year commissionership to date is his work in youth baseball, which has resulted in deepened ties with Little League Baseball and Softball, and four straight years of growth in overall participation levels.

Minor League Baseball serves as a crucial link in that effort, with teams routinely hosting local youth teams at their games and further exposing children to baseball.

“A lot of the kids coming here to NYSEG Stadium [in Binghamton] are never going to Citi Field or Yankee Stadium,” says Rumble Ponies owner John Hughes. “We’re how they get excited about baseball. And if they don’t have a chance to see somebody like [2019 MLB home run champion and former Rumble Pony] Pete Alonso come through here, how that does happen? Would they watch the [New York] Mets on TV otherwise? There is huge value to what we do.”

And there is the government consideration. Congress has already blasted MLB’s proposal on a broad, bipartisan level, and pointedly threatened a retreat of support on several key federal legislative fronts, including overtime and wage laws and perhaps baseball’s treasured antitrust exemption.

But on a more local level, MLB’s proposal also will likely make it much more difficult for minor league teams to secure public money and bondholder support for renovations or new facilities in the future, which will ultimately lead to the same ballpark issues that helped start this entire saga. And some minor league figures have privately wondered if this proposal is even the last they’ll hear of potential franchise reductions.

“This is something we will fight tooth and nail to prevent from happening,” said Richard David, mayor of the city of Binghamton, of the MLB plan. The city, which owns NYSEG Stadium, was part of funding more than $9m in renovations over the past three years to get the ballpark compliant with MiLB standards, and based its lease with the Rumble Ponies in part upon the club’s affiliation with the Mets.

“We are organized and mobilized. We are well positioned and are going to fight for our team,” David said.

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