Report: Looming Term Sheet Creates ‘Wild West’ as MiLB Teams Scramble to Make List of 120 Full-Season Affiliates
Despite reports that decisions have already been made, Major League Baseball has yet to conduct formal conversations with its partners in Minor League Baseball regarding the future of the latter organization. It certainly appears, however, as though MiLB will be contracted down to 120 teams — a reduction of around 40 teams — following what figures to be a lost 2020 season. Nothing can be done with those talks until the MLB season is figured out, but expect things with the minors to be finalized shortly thereafter.
According to JJ Cooper of Baseball America, the current MiLB environment is like the “Wild West” as owners and officials scramble to figure out how to ensure a spot on the safe list. Though an initial report had listed out those teams that would remain as part of the future of affiliated ball, it’s apparently still in flux. As you might expect, there are a lot of unknowns clouding any predictions.
Of the 33 teams on the initial contraction lists in leagues with Player Development Contracts, only one (Grand Junction) was owned by an MLB team’s owner. Of the 118 current MiLB teams on the initial “safe” list, MLB owners either are the majority owner or a minority shareholder with 30-40 of them. (Different sources provide different numbers for how many teams have MLB ownership and the ownership shares are opaque enough that it is a difficult number to pin down precisely.)
The Cubs and their affiliates may not be as heavily impacted by these moves as other organizations, at least in part due to the strong relationships between the parent organization and its affiliates. Though it seems likely they’d lose the Eugene Emeralds with the conversion to full-season only and a limit of four non-facility affiliates, the other four current partners seem like good bets to remain.
The South Bend Cubs are owned by Andrew Berlin, who also maintains a minority stake in the big club, and there’s been heavy investment in the low-A team’s infrastructure in conjunction with the partnership. Myrtle Beach has likewise done a great job of aligning with the broader organization to embrace its ties to the Cubs. The Tennessee Smokies are not on the cut list and don’t figure to be, same for the Iowa Cubs, who’ve been part of the organization longer than their affiliate brethren.
Cooper reports that almost everyone involved believes MLB will be calling more of the shots under the new arrangement, whatever that ends up being. It’s possible that will come as the result of increased ownership in affiliates by parent clubs, something that could primarily be a means by which to avoid contraction. With fair market values mucked up by the current economic situations and most MiLB teams struggling to generate revenue, the best way to remain afloat might be to part with equity for pennies on the dollar in exchange for safety.
I know it may come as a shock to you that MLB and its owners would be seeking to further control labor costs and increase profit margins, but it sure looks like that’s what’s going on here. The abbreviated draft this year is expected to save around $140 million in signing bonuses, then you’ve got the potential for 40 fewer teams and several hundred fewer players, with owners very possibly having a bigger stake in revenues generated by their affiliate partners.
All of this is going on in back channels for the time being, but it’ll come to light soon enough as MLB looks to solidify its position and move forward with the season. Whatever happens, it’s a near certainty that the minors are going to look completely different by next year.
