Inside Indiana Business
SOUTH BEND – The Minor League Baseball parks in Indianapolis, Fort Wayne and South Bend sat empty this past weekend. Father’s Day is typically a big draw in attendance. But the pandemic has kept the gates closed to fans.
“We had a home game on Father’s Day each of the last six years, said John Nolan, media relations manager for the Fort Wayne TinCaps. “It’s never been on the scale of the Fourth of July, but, yes, certainly is one we think families circle on the calendar.”
More than three months into the season, and the outlook for minor league baseball is growing dimmer each day.
“When you can’t bring people into the stadium, you’re going to be incurring costs. And revenues will be awfully close to zero,” said Richard Sheehan, a professor of finance at the Mendoza College of Business at the University of Notre Dame, who has written multiple academic papers on the economics of sports.
As Major League Baseball continues to negotiate with the player’s union on a severely-shortened season, the closures in minor league parks now have less to do with the healthcare crisis and more to do about MLB, which dictates how Minor League Baseball operates.
“We are at the mercy of Major League Baseball since we are an affiliate of the San Diego Padres,” said Nolan. “I’m not aware of a cutoff date to determine the Minor League Baseball season, but we’re being transparent that we’re not optimistic.”
Sheehan said single-A clubs, like the Fort Wayne TinCaps and South Bend Cubs rely heavily on ticket purchases to cover operating costs.
Unlike MLB, few MiLB teams earn revenue from media rights.
“While that can be viable for them (MLB teams) with their TV contracts, it’s not viable for MiLB to have games with no fans,” said Nolan.
Another question is the safety of fans. Are social distancing, face masks and hand sanitizer enough to get fans back through the gates. And does a limited number of ticket sales make fiscal sense?
“If you have a stadium with 5,000 people, and you’re allowed to have 1,000 in and spread them out, that’s a possibility (to hold a game),” said Sheehan. “But will 1,000 people or a much smaller fraction in the stands give you enough revenue to make it worthwhile to put on a show?”
The farm clubs often depend on financial support from the parent organizations of the major league teams.
“If majors are not going to help out minor league players, they would hope to be major leaguers at some point, to think they’re going to facilitate the minor league franchises, I think any minor franchise counting on that money is being wildly, grossly optimistic.”
These leagues typically play a full 140-game schedule, which runs from the first week of April through the first week of September. Now at the half-way point, Sheehan says don’t expect to catch a game at a minor league park this summer.
“I’m not the least bit optimistic.”
SOURCE: Inside Indiana Business