Transfer Fee Hurting American Association Brand, Play
American Association Daily provides insights, features, and recaps of the action from around the American Association of Professional Baseball League, as well as player and coaching profiles and transactions. In today’s edition, Robert Pannier looks at how the increase in the transfer fee the American Association is charging Major League Baseball teams is actually hurting the league’s success and reputation.
A Full Disclaimer Before We Begin
Before making my point, it is important to stress that I love American Association baseball. It is far more enjoyable to me than either Major League Baseball or the minors, and I have built my summers around this league every year since 2014. Many of the ownership groups have been great to me, the players have been very receptive to talking with me, many of the managers and broadcasters have become close friends, and I believe that Commissioner Josh Schaub and Deputy Commissioner Josh Buchholz have done a spectacular job with this league.
This combination has helped to make this the best independent baseball league (partner league if you so desire) in baseball. The action is exciting and fun, the players really get into games, and the managers are in it to win. This is baseball at its best.
I have spent the last nine years writing about this league virtually every day. I not only enjoyed covering the league, but helping to promote it as well. My goal is to give others the same passion for American Association baseball as I have.
With that being said, I also feel that it is my responsibility to call out the league when they are making a drastic mistake, and one is being made right now that is hurting the success and reputation of the American Association.
The Covid Hangover
In 2021, the American Association saw an unprecedented event that was far beyond anyone’s imagination. Due to minor league baseball being shut down in 2020 and the contraction of minor league teams down to 120, there was a dramatic need for MLB teams to find talent to fill their minor league rosters. This led to nearly 80 American Association players having their contracts transferred to a Major League affiliate.
It was remarkable, not only because of the sheer number of players the transferred, but also because it meant that the story surrounding these transfers were just as intriguing. For example, Fargo-Moorhead RedHawks left-hander Kevin McGovern finally reached his dream of being signed to an affiliate contract at the age of 32. It was an exciting story to say the least, as a guy who had proven for years that he deserved a chance with a Major League affiliate had finally achieved it.
This was one of the many great stories that the league could boast. Honestly, it did hurt the play on the field, as pitching was pilfered at a level never seen before, and that led to skyrocketing offensive numbers. However, it also led to a boost in the American Association reputation as a league that had between 5-20 quality players on every roster.
No doubt the Commissioner’s Office and owners were proud of the success the league was having in transferring so many players back to MLB. Unfortunately, this led to a decision to try to capitalize on the success. Owners opted to increase the transfer fee from $5,000 to $10,000, and then finally settling in on $15,000.
It was understandable. There was a lot of money to be made by players contracts being transferred. The math supports this. If 80 players had their contracts transferred at $5000, that was $400,000 for the league and the teams. If you increase that number to $15,000, that would have been $1.2 million. Looking at those numbers, the decision to increase to transfer fee seemed obvious.
This also seemed like a great way to recoup some of the money that was lost by clubs during the pandemic. Six teams did not play in 2020, and the six who did lost a considerable amount of money by having small crowds for most of the summer. It only made sense to find other areas where owners could mitigate some of those losses.
If You Charge It, They Won’t Buy
While it may seem like sound mathematics, this decision has had a detrimental impact on the league as a whole. While this may seem illogical considering that MLB is earning billions of dollars a year in television revenue, ticket sales, and merchandise, many teams are unwilling to pay this increased cost.
This is not a secret either. Both players and managers recognize that contracts are not being transferred because Major League affiliates are unwilling to pay the money. A reputation is starting to build and players looking for a league to play in are opting to go to the Atlantic League or the Frontier League instead.
These leagues were in the exact same situation at the start of the season. They recognized the large number of transfers they had last year and opted to increase their transfer fees as well. However, the Atlantic League later recognized that this was becoming a hindrance to players being signed and decreased the amount back to $5000. That is now becoming the destination league for players looking to get a chance with an MLB club. [Update to this statement. I have been informed that the Atlantic League did not lower their fee. There were reports that they had done so from a few different sources, but those reports appear to have been mistaken. My apologies for posting information that was not correct. I have left the statement up so that those who may have heard about this statement and came to the article would be able to see the statement and read the correction.]
The American Association owners and Commissioner discussed this issue at the All-Star break, considering the idea of returning the transfer fee to a lower amount. However, that decision was tabled until after the season. That was a mistake.
The MLB draft was last week, which means that there are going to be a large number of releases across the minors over the next few weeks as high school and college players are signed. Those players are going to be looking for a league to play to continue their careers, but many are going to opt to choose to play in another independent league because agents are going to steer them away from the American Association. That is simply not good news, and it is not good for the quality of play on the field or for the reputation of the league.
This is a league that has prided itself on helping players get opportunities to continue to pursue their dream of playing Major League Baseball one day. Unfortunately, dollar signs are standing in the way of that right now. It’s time to bite the bullet, and get back to doing the things that made this the premier independent league in the sport.
By Robert Pannier