Dave Nichols: MLB proposal restructuring minor leagues could have drastic impact on future of professional baseball in Spokane

According to reports in the New York Times and Baseball America on Friday, Major League Baseball has provided a proposal to Minor League Baseball to drastically restructure the organization and maintenance of minor league teams, leagues, player contracts and the entry draft.

The Professional Baseball Agreement (PBA) between MLB and MiLB expires at the end of the 2020 season. According to the reports, MLB’s proposal – described as a “preliminary offering” – would reduce the number of affiliated minor league teams from the current 160 to 120 starting in 2021 – putting thousands of minor league players out of work.

The proposal would completely eliminate the four short-season and rookie-level classifications from the minor leagues.

According to Baseball America’s report, the Northwest League – of which the Spokane Indians have been a long-standing member – would move to full-season baseball, presumably at a different classification level and with additions and subtractions to the current lineup of eight teams.

How they come to that, and resolve the complex money issues at the national level, is still to be sorted out and sure to be contentious.

But one thing is certain before play starts for the 2021 season: vast change to a system that has remained largely unchanged for decades, with the billionaire owners of MLB clubs benefiting the most while smaller communities could lose their ties to major league baseball entirely.

When asked for comment, Indians executive vice president Otto Klein took the long view.

“We have no additional information to share (other) than what is already public,” he said. “This will be a long negotiation and process. It’s still very early.”

Klein’s statement echoed that of MLB and MiLB executives in the Baseball America story.

The proposal would also completely reorganize the full-season minor leagues to make them move “geographically compact.” Some established leagues would shrink, some would expand and current teams would be asked to shift classifications to bring affiliated teams closer to their MLB parent clubs.

That concept would dramatically impact the valuation of some MiLB franchises, which is guaranteed to be a contentious point in the negotiations. Currently, the value of an MiLB franchise is based upon open market value, while the proposal would value teams on a set scale based strictly on classification – dictated by MLB.

MLB deputy commissioner Dan Halem explained the rationale of the proposal to Baseball America.

“From the perspective of MLB clubs, our principal goals are upgrading the minor league facilities that we believe have inadequate standards for potential MLB players, improving the working conditions for MiLB players, including their compensation, improving transportation and hotel accommodations, providing better geographic affiliations between major league clubs and their affiliates, as well as better geographic lineups of leagues to reduce player travel.”

But it goes much deeper than that.

MLB wants to rework the Player Development Contracts (PDC) with its affiliates to have more control over movement at the affiliate level. The PDCs expire every two years, leading to a lot of shifting between minor league affiliates and the parents, creating availability and travel concerns.

The proposal suggests longer-lasting agreements so that there is less movement between affiliates, providing MLB more certainty and control over the process.

It’s also a cost-cutting measure.

MLB teams pay the salaries and benefits of all affiliated teams’ players and coaches. The affiliate is responsible for staff, travel, food and other expenses. For most short-season and rookie-level teams, salaries and insurance comprises a significant share of MLB expenses associated with the affiliate.

For many years, MLB and MiLB have tried to figure out a way to pay minor league players better than the stipend-level contracts that many work under. Few drafted players receive a huge signing bonus which ensures financial freedom for themselves and their families.

There’s no union for minor league players. The standard minor league contract provides a fixed salary starting at $1,100 per month – and that’s in-season only and before additional taxes and clubhouse fees are taken out.

The issue of minor league pay was the subject of a lawsuit against MLB filed in 2014 in U.S. District Court in San Francisco, trying to force MLB to pay minor league players as hourly workers – including all hours of play, practice and travel. Minor league players aren’t paid for their time in spring training or extended spring training.

One way of making the raises pay for themselves is to eliminate nearly 25% of the work force.

Another major part of the proposal is to reduce the entry draft from 40 rounds to 20-25 rounds.

Undrafted players – many of whom have historically stocked the 42 short-season and rookie-level teams that are proposed to be eliminated – would be placed into what the proposal calls “Dream Leagues” – essentially tryout camps for players on per diem instead of full-time minor league baseball players.

As the reports suggest, this is just an opening proposal by MLB to address many of the issues and concerns regarding the structure and operational procedures of minor league baseball.

Players need to be paid more. Working conditions need to improve in a lot of places. MLB teams want more certainty with – and control over – their affiliates.

It’s just a shame that will come at the expense of the lowest levels of organized baseball, where the dream to play professional baseball for so many might no longer exist.