'We're In Dire Straits:' MiLB President Paints Bleak Picture Of League's Future
On Tuesday, after Minor League Baseball announced its season was officially canceled, MiLB president Pat O’Conner painted a dark but frank picture of the future.
Already, the league was threatened by Major League Baseball’s plan to contract roughly 40 MiLB teams in an effort to realign the minors. The economic stranglehold placed on teams by the coronavirus pandemic has only made things worse and could result in teams that aren’t on the chopping block being forced to fold their operations.
"It’s north of half (of MiLB teams) who could either have to sell (or go insolvent without government or other help),” O’Conner said. “This is the perfect storm. There are many teams that are not liquid, not solvent."
To help keep things afloat, MiLB has put bills in front of Congress that would provide some sort of lifeline to keep teams in the most dire straits from having to close their doors forever.
“H.R. Bill 7023 is a lifeline loan program through the federal reserve. There will be a companion bill in the Senate shortly,” O’Conner said, “that is really very necessary to get us through. Many of our clubs qualified for (payroll protection plan) money that the Congress issued through one of the first stimulus packages.
“That was a Band-Aid on a hemorrhaging industry. So we’re just treading water, trying to see our way through this. We’re looking at, in some cases, 17 months with no revenue to speak of. It’s really been a challenge.”
O’Conner noted that some clubs have gone through as many as three rounds of furloughs and the league office has gone through one round of pay cuts and furloughs and was preparing for a second group of furloughs in the coming days.
“It’s extremely difficult for us to project, because there is no end in sight in the immediate future,” O’Conner said. “Our clubs are committed. They are capitalized as best can be expected. We are in dire straits, and I still have grave concerns. What happens every day doesn’t alleviate any of my concerns.
“What does buoy me is the fact that Congress has been very supportive, very active in trying to find a way to provide us these lifeline loans. It’s not a bailout. It’s not a grant. We just need a lifeline to get to the other side of what is a national crisis.”
This is not the first time in recent history that Minor League Baseball has appealed to Congress for help. In 2018, the league successfully lobbied for the passage of the Save America’s Pastime Act, which exempted minor leaguers from the Fair Labor Standards Act (FLSA), which guarantees hourly-wage and overtime protections to most workers across the country.
There were discussions initially about possibly playing the second half of the 2020 season in July, August and deep into September, but the rise in cases around the country put that idea to rest.
Minor League Baseball is not like Major League Baseball. It cannot survive without fans in the stands, so various states’ restrictions on how many people (if any) can gather in public areas like stadiums seriously cut into any chance of getting the 2020 season off the ground.
"It became clear we could not overcome the justified governmental protocols let alone the protocols to get players into and out of stadiums, onto buses," O'Conner said.
Ultimately, the decision to shut down was a long time coming, but wasn’t finalized until fairly recently.
"It wasn’t an acrimonious decision (between MLB and MiLB). I appreciate everyone feeling bad about today,” O’Conner said. “This has been months in the coming. It was the right thing to do. From a practical sense it was the only thing to do."
While most of O’Conner’s session was understandably focused on the problems that lie ahead for the league, he did make sure to point out all the good that MiLB clubs have done and continue to do for their communities during the pandemic.
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"One of the things I’m extremely proud of is the amount of charity work, the amount of good work going on in the communities,” he said. “We fed over a half million meals as a result of efforts of our ball clubs."
Now, the league turns its eye toward the future. The Professional Baseball Agreement between the parties expires on Sept. 30, and negotiations have been nearly nonexistent for the last six weeks or so while MLB and the MLBPA hammered out the details for the restart to the big league season.
Once the dust settles on that arena, the two sides are likely to meet again to discuss the particulars of what the minor leagues will look like in 2021. As part of MLB’s plan, each of the 30 big league clubs would have four full-season minor league teams and at least one more at its home complex in either Florida or Arizona.
That alone presented a sizable threat to the future of the league. The coronavirus has raised the stakes considerably.
“This threat from the coronavirus, it transcends any list that anybody wants to make with respect to the possibility of teams not being around in the future,” O’Conner said. “Deep into the 120, what are traditionally very strong clubs are in dire straits.”
That’s not only true for 2020 and 2021, but for even deeper into the future. O’Conner repeatedly referred to the financial situation MiLB faced in 2008 and 2009, when economic recession put financial pressure on many teams.
"I could see this (economic impact) lingering into 2022, 2023 easily,” O’Conner said. “In some cases, possibly a little longer."