The End of Indy Ball?

The “Save America’s Pastime Act” had no cosponsors and was never heard or voted on; however, it is now law.

Thanks to the Federal Spending Bill being passed, minor league baseball (especially independent baseball) may be completely changed.

The provision in the bill states that:

[A]ny employee employed to play baseball who is compensated pursuant to a contract that provides for a weekly salary for services performed during the league’s championship season (but not on spring training or the off season) at a rate that is not less than a weekly salary equal to the minimum wage under section 6(a) for a workweek of 40 hours, irrespective of the number of hours the employee devotes to baseball related activities.

This is a win for Major League baseball since they will not have to pay overtime to any of their players, including minor league players on their affiliated teams. It essentially kills the lawsuit that some former minor league players filed claiming that they should be paid overtime under minimum wage laws.

This law will only require a slight raise (with no overtime) to the lowest affiliated levels and will not affect the majority of teams or players.

But… this isn’t the case for independent baseball. These leagues are ran without financial help from a major league organization. They are small businesses ran on small salaries aided by the hopes and dreams of baseball players who just want a chance to keep playing and be seen by a “higher” level.

For most players, the money really doesn’t matter. It’s that chance to chase their dreams, and they are okay with the small pay they receive. It’s not always right and conditions are often rough, but it’s what they willingly choose to do.

People will look at some of the lower levels of professional baseball (including the Pecos and Empire leagues) and see their demise as a good thing, but it will still have a huge impact on so many people.

Every summer, these players join leagues that play in small towns all across America where families can enjoy a night at the ballpark without breaking the bank or traveling all the way to a major league park. Seasonal workers get a little extra money during those summer months, and college kids can get valuable experience through internships.

Sadly, those nights in most towns may be about to end.

If teams have to pay all players 40 hours a week at minimum wage, there may be BIG problems in independent baseball. Federal minimum wage at 40 hours would result in players being paid at least $290 a week or $1,160 a month.

Last season, the longest running independent league, the Frontier League, paid players a minimum of $600 a month (and a maximum of $1,600) with a total team salary for the season set at $75,000.

The higher leagues: the Can-Am, the American Association, and the Atlantic League, all have yearly salaries of $102,000, $115,000 and $225,000-$275,000 (based on the team) respectively.

This won’t really affect the Atlantic League, but will cause an impact on the American Association and the Can-Am.

And as it currently stands, it could cripple the Frontier League and all lower indy leagues: the Pacific Association, United Shore League, Pecos League, and the Empire League.

If teams are forced to pay all players a weekly salary of at least $1,160 a month, the whole landscape of indy ball will be disrupted.

Mike Shapiro, the president of the San Rafael Pacifics in the Pacific Association, was quoted as saying: “If that is the case, it puts us out of business. It would be the ruination of at least lower level independent leagues like ours. We’re struggling enough with worker’s comp . . . It’s the end of independent ball, certainly at the lower levels.”

He definitely isn’t the only one worried about the upcoming season. Many managers and owners that I talked to off the record are also concerned.

This could very well be the end of independent baseball as we know it.

“I tell you who gets hurt the worst, it’s not only the players, where we are the last stop,” Shapiro said. “They lose out because they don’t have the opportunity. The other who loses out is these communities with 1,000 seat ballparks. It’s a cheap night out for local families.”

There is hope that indy ball can continue operating as a seasonal business with the players being seasonal employees and exempt from all minimum wage laws, hopefully including this new one.

Only time will tell if indy stadiums are going to be forced to go dark.

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10 thoughts on “The End of Indy Ball?”

  1. As much as I like indy ball and want it to thrive, it is nonetheless a risky business model and always has been. If it is to survive, it will need to be creative or frugal. If it can’t do that, then it’s not only a risky business model but a failed one. I don’t know that the process needs to be modified to support a business model that didn’t ask for one when it decided to challenge the system in the first place. I equate this to asking the government to control flooding at your house after you built it next to a river that sometimes floods.

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  2. Geez, maybe it’s me, but I read the linked articles (and others in a search) and it appears that there will be no effect on Indy leagues who pay $600/month or less to the players.

    Specifically, it is this passage (in the “no cosponsors” link) where I deduce that there is nothing new or changed:

    “No one is forcing anyone to become a minor league baseball player, nor to sign a $3,000 contract for five months of work. Each player chooses to work for those terms, and most are doing so in hopes of reaching the major leagues and getting a much larger paycheck in the future. There are many circumstances in which people might choose to defer compensation in the present for the promise of greater opportunity.”

    So again, I read the act/law to be a victory for MLB and MiLB in that their players (and Indy players) are employees of an “amusement or recreational establishment” and therefore aren’t required to be paid minimum wages.

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  3. Fangraphs (Nathaniel Grow) had a very good article today stating that this shouldn’t effect Indy Leagues because of other laws that more or less exclude Indy Leagues from minimum wage requirements because of certain factors (operating 7 months or less out of the year, being an amusement or recreational business).

    I believe there’s still hope!

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  4. Kayla, Good article here. The bigger question which no one is asking is if there are alternative methods to generate revenues at the team level in order to offset the increase in hard costs. While everyone is looking at ways to circumvent the rules in the lower independent leagues, the independent team owners & GM’s need to revisit their “independence”. Several of the lower-level teams have stadiums and operations within the radius of a major league team. By this I mean St. Paul is running within a close distance of the Twins, San Rafael (from a straight line perspective, not in driving reality!) is 20 miles to San Francisco, Florence Kentucky is within 15 miles of Cincinnati, etc. If these teams shut down operations then each stadium would be open to the MLB team placing an affiliate nearby depending on obvious factors.

    In order to counter this, the teams currently are sitting on “untapped oil reserve” (or “gold mine”) from their own web properties. Each team’s website is super-authoritative in the search engines for the POTENTIAL to outrank Yelp, Yellowpages, HomeAdvisor.com, Houzz.com, and other national directory websites for LOCAL phrases. For example, Florence’s website (http://www.florencefreedom.com/) has a huge amount of authority given to it by Google, Yahoo, Bing, etc. The team can add a 500-1000 niche local business directory and, if optimized properly, can have a page on its website ranking in the top Google spots for phrases like “dentist Florence KY” and “divorce attorneys Florence Kentucky”.

    Once the team were to have such a ranking, it would become a valuable asset to lease out to local business — just like each team does with its outfield wall signs. The lease fee could be anywhere from $100 to $1000/month, YEAR-ROUND (not just during the season), because local businesses which advertise crave one thing above all else — new customers/clients calling & generating new business.

    This changes the entire dynamic of a “seasonal ENTERTAINMENT business” (the way most leagues & owners view their operations) into somewhat of a “year-round MARKETING” business, helping local businesses get more exposure to people in the local markets. If done right, at just $100/month per page leased ($1200/year) the team which leases out 50 pages just brought in $60,000 — enough to offset the whole issue with the minimum wage to begin with. Obviously leasing out more pages and/or at more than $100/month generates even more revenues to give the teams more cushion.

    YES, this already is being done with teams in Texas and can prove it for those interested. If you are in touch with Frontier League GM’s then PM me if they are interested in saving their operations.

    Hope this helps keep the Frontier League as-is or, ideally, even make the teams so much more profitable that it can expand quickly in coming years instead of considering contraction. The same applies to the other leagues as well. I am already in touch with Pecos about this, and they are implementing architecture to get started.

    Thanks and great job again on this article!
    Matt

    P.S. None of this would involve the players, although if an enterprising player who can speak well actually could benefit with this process if all parties work together instead of the typical “disconnect” between players and the front office. Again, “independent” baseball needs to think “independently” of its MiLB counterparts in order to run circles around them from a business perspective. Each Frontier League, Pacific Association, Pecos, AA, and Can-Am team is sitting on this potential as you are reading this. Hopefully they have enough humility to discover the hidden assets they already posses and learn how to exploit them, much like one would exploit one’s own land if he/she discovered oil on it.

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  5. Glad to see you wrote about this sad situation. I wrote about it here too and would appreciate it if you’d check out my take. I saw that someone from the MLB offices read my post. I bet they didn’t like me pointing out that they spent 1.3 million the past two years lobbying congress to pass this bill that could well kill indy ball.

    http://thezom.com/will-independent-baseball-leagues-fold-year/

    This is disgusting act by our government and probably 80% of the politicians who voted to kill independent baseball didn’t even read the bill they voted on since it was about 2000 pages long and they had 72 hours or less to read it.

    I like the outside the box thinking about the websites above except for the fact that I googled “divorce attorneys Florence KY” and what
    appears are 3-4 ads and a google map with attorneys listed. Google has actually done away with the need for any directories or website in some instances. I had a website with the largest pizza directory in the world and it was rendered useless by Google and the way they now display maps (their maps) with businesses related to google searches.

    I hope something can be done i.e. a U.S. Representative can author a bill in congress and get co-sponsors from reps of every area with independent baseball to actually “save America’s pastime” instead of kill the dreams of so many players.

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