Even with pandemic pressures and ongoing labor negotiations between the minor leagues and Major League Baseball, sports business experts share a consensus that Double A teams like the Tennessee Smokies are on firm financial footing.
Smokies owner Randy Boyd is banking on that analysis, unveiling this week in an exclusive interview with Knox News a proposed $142 million mixed-use baseball stadium complex in Knoxville’s Old City.
Boyd is hoping local elected officials will see it the same way as he seeks taxpayer help to pay between $52 million and $65 million for a new baseball stadium.
Major heartburn for minor leagues
Even before the pandemic, Minor League Baseball teams were becoming potential casualties of Major League Baseball’s contract negotiations. The contract — the Professional Baseball Agreement — expires in September.
Major League Baseball has proposed cutting teams from roughly 160 to 120 in order to increase pay and improve working conditions, especially travel, for players.
The money lost to the pandemic-cancelled minor league season has threatened the viability of some clubs.
In November, the New York Times released a list of 42 teams that could be on the chopping block, including four Double A teams on the same level as the Smokies. Those teams included the Binghamton Rumble Ponies, Chattanooga Lookouts, Erie Seawolves and Jackson (Tenn.) Generals. No Triple A teams were on the list.
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Kevin Reichard, editor and publisher of Ballpark Digest, an industry leader in Minor League Baseball reporting, said the list published by the New York Times is outdated and negotiations have moved on. Any talk of future cuts will likely come once the contract expires, he said.
Regardless, Reichard said, the Smokies are in good shape and will continue to be because they are in the lucrative and sizable Knoxville market.
“In terms of a business model, there’s not been any talk about Knoxville losing a team. The team’s future is secure,” he said. “The team’s finances won’t change materially with a new deal between Major League Baseball and Minor League Baseball.”
Florida State University professor and baseball industry expert Mike Brady agrees. Brady, who played parts of five years in the minor leagues, said the Smokies are insulated from cuts.
“The most important level in the minor leagues is Double A … it’s where the most talent exists. It’s where the players play who the franchises are most excited about,” he said.
When Knox News asked Boyd about the uncertainty of the industry, he smiled. He wouldn’t propose a $142 million project if he thought there was reason for concern, Boyd said.
Unlike the Smokies, the Chattanooga Lookouts — the closest Double A team to the Smokies and a fellow-Southern League affiliate — are not sitting so securely. Both teams opened new parks in 2000.
Lookouts co-owner Jason Freier told Knox News recent conversations lead him to think the Lookouts will not be one of the teams cut and that it will remain affiliated with the Cincinnati Reds.
Landing on the list of clubs that could be cut, he said, is more a product of modern facilities and not a lack of fan support (the Smokies and Lookouts finished fourth and fifth, respectively, in Southern League attendance last year). Freier said AT&T Field, where the Lookouts play, could use “some meaningful improvement.”
This tracks with what Baseball America reported last fall when it said MLB Deputy Commissioner Dan Halem told them that upgrading facilities for minor league teams was a “principal goal” in contract negotiations.
“What we’d eventually hope to do in Chattanooga is not just say, ‘Hey, Major League Baseball is telling us they’d like a new ballpark,’” Freier said. “It’d be, ‘Hey, that’s certainly one consideration (and would) preserve baseball for the long term in Chattanooga, but we believe at the right time and in the right circumstances you can do this in a way that would be beneficial for everybody involved …
“I know that that’s the angle Randy and his folks have been coming at it in Knoxville and it looks like they have a very interesting project.”
‘Less is more’?
The New York Times list also included eliminating the entire Appalachian League. The 10-team league includes three teams Boyd owns: Greeneville, Johnson City and Elizabethton in Tennessee.
“We never got into the baseball for the money,” Boyd told Knox News. “It was always because of the love of the game and those investments and those teams were for the love of the game and the love of the community. And to see those communities lose those teams is pretty heartbreaking.”
Still, Boyd said, owning one of only 120 teams in a contracted minor league landscape could make the Smokies more valuable.
Mike Brady, the Florida State professor, agrees. “The cities in and around where Minor League Baseball happens are pretty saturated right now, so I think, if anything, it might stoke some demand for Minor League Baseball I’d like to believe.
“Because a lot of those teams don’t get a whole lot of attendance, but if you cut them back a little bit and spread them out strategically it might be a good thing for attendance.”
Boyd’s plans for a stadium rely on him receiving up to $65 million in public financing to build the stadium. The rest of the proposal — a 630,000-square-foot restaurant, retail and residential complex costing $142 million — would rely on private dollars.
Boyd would include in any deal the seven acres he bought in the Old City for $6 million in 2016.
As Boyd has it drawn up, the park could host concerts and accommodate a soccer field in the outfield. It would include spaces for conferences and a public plaza for markets and watch parties.
This follows what Knoxville city officials — like Chief Operating Officer David Brace — have previously said about a a stadium that could host 200 to 300 events a year.
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