Why they had to find investors

[old nurse]

https://registrationz.mlbpa.org/pdf/MLB Basic Agreement 2022-26.pdf

 

Way down in amendment 22, somewhere around page 250 there are the rules for clubs being in debt.  MLB doesn’t like teams carrying too much debt. 

[TNtwins85]

1 hour ago, old nurse said:

https://registrationz.mlbpa.org/pdf/MLB Basic Agreement 2022-26.pdf

 

Way down in amendment 22, somewhere around page 250 there are the rules for clubs being in debt.  MLB doesn’t like teams carrying too much debt. 

It would seem that it’s not just the Twins or Pohlads who facilitated all this and it was in turn handled with tight conjunction with MLB. I just skimmed this section but I love you went to the actual CBA agreement as I like to routinely reference to the actual agreement rather than read an article on someone else’s interpretation of it. It’s interesting when you really dig into that thing!

[Richie the Rally Goat]

That’s only part of the why. Payroll is 90% of the operating costs. The entire front office costs a relief pitcher. Field operations are probably the largest non-player expense and almost all of the game day staff are volunteers, the big chunk of that is water and electricity.

The debt $300m-$500m is 2-3 years of operating costs? How does this team accumulate that much debt in 5 years?

[old nurse]

44 minutes ago, Richie the Rally Goat said:

That’s only part of the why. Payroll is 90% of the operating costs. The entire front office costs a relief pitcher. Field operations are probably the largest non-player expense and almost all of the game day staff are volunteers, the big chunk of that is water and electricity.

The debt $300m-$500m is 2-3 years of operating costs? How does this team accumulate that much debt in 5 years?

https://www.mlb.com/twins/team/front-office

Between the listed Executive Board, Baseball Operations and Administration I could see a cost that is easily half the player payroll numbers.  Then there are the other 200 people 

[old nurse]

1 hour ago, TNtwins85 said:

It would seem that it’s not just the Twins or Pohlads who facilitated all this and it was in turn handled with tight conjunction with MLB. I just skimmed this section but I love you went to the actual CBA agreement as I like to routinely reference to the actual agreement rather than read an article on someone else’s interpretation of it. It’s interesting when you really dig into that thing!

Understanding what is in there shows why the Twins had to get investors.  As San Diego tried to borrow their way to contention, the bill came due. They have had to retrench. 

[Major League Ready]

1 hour ago, Richie the Rally Goat said:

That’s only part of the why. Payroll is 90% of the operating costs. The entire front office costs a relief pitcher. Field operations are probably the largest non-player expense and almost all of the game day staff are volunteers, the big chunk of that is water and electricity.

The debt $300m-$500m is 2-3 years of operating costs? How does this team accumulate that much debt in 5 years?

Where are you coming up with the 90% number?  That would be a total of roughly 33M for all other costs. If this were true, the team would be making $150M/year.  Actually, every team would be making over $150M. 

The Twins have 942 employees according to this site.  IDK if this is accurate.  We can find the number of FO people but I would assume their are a lot more non-front office employes.   We also don't know their average salary especially given this includes a handful of very high salaries but let's use a very conservative estimate of $60K given we don't have good data, that's $56M or 17% of revenue.  Just health care costs would be $25M or 7.5% of revenue.  Their draft and international bonuses are around $20M.   That's 6%.  So, that's a total of $30.5% before considering any cost for equipment, office space, computers, travel, advertising, etc.  

 

[Richie the Rally Goat]

52 minutes ago, old nurse said:

https://www.mlb.com/twins/team/front-office

Between the listed Executive Board, Baseball Operations and Administration I could see a cost that is easily half the player payroll numbers.  Then there are the other 200 people 

the half dozen at the top might be well paid, Falvey is in the millions, the rest of the C-Suite is in the hundreds of thousands. Board positions aren’t always paid, being the number of Pohlads on the board, I’d guess they aren’t, but I don’t know.

what I do know, is 90% of the jobs I’ve seen are hourly. I have an acquaintance who is the owner of his own sports medicine practice and for a while he was a trainer with the Twins, he was paid 40k and couldn’t afford to take time away from his practice any more to continue to do it.

200 people at 40k is 6.6m, plus 6-10 executives each making 500k plus the c suite making $1m each is 16m total. That’s just Buxton
 

AAA ball players make 100k, the lower levels are in the 60k range

https://recruitingbypaycor.com/career/JobIntroduction.action?clientId=8a7883d08b729b3e018b72dc67f6007f&id=8a78859f9b13764b019b3310028b2d36&source=&lang=en

[bean5302]

13 minutes ago, old nurse said:

Understanding what is in there shows why the Twins had to get investors.  As San Diego tried to borrow their way to contention, the bill came due. They have had to retrench. 

Mets too. MLB leadership essentially forced Wilpon to sell the Mets due to financial issues.

The Pohlads borrowed money to use for other business ventures and used the Minnesota Twins business as collateral which is where most of the debt comes from. I don't think the Pohlads were in dire straights and needed to find new investors so much as it was obvious they wouldn't be able to sell the team for enough "net" money to fund their additional business portfolio plans into the future so they decided to strengthen their financial position through minority ownership of the Twins rather than getting new investors into the Pohlad Companies who would dilute the Pohlad family control over their other businesses.

[Richie the Rally Goat]

4 minutes ago, Major League Ready said:

Where are you coming up with the 90% number?  That would be a total of roughly 33M for all other costs. If this were true, the team would be making $150M/year.  Actually, every team would be making over $150M. 

The Twins have 942 employees according to this site.  IDK if this is accurate.  We can find the number of FO people but I would assume their are a lot more non-front office employes.   We also don't know their average salary especially given this includes a handful of very high salaries but let's use a conservative estimate of $60K, that's $56M or 17% of revenue.  Just health care costs would be $25M or 7.5% of revenue.  Their draft and international bonuses are around $20M.   That's 6%.  So, that's a total of $30.5% before considering any cost for equipment, office space, computers, travel, advertising, etc.  

 

Fair enough, player salaries are 70%. Still, how can a team rack up 1.5 to 2 years of operating costs in debt in 5 years? HOW? How can the Pohlad family justify not clean house on the entirety of the franchise operations and board if they racked up that much debt that fast?

[bean5302]

6 minutes ago, Richie the Rally Goat said:

Fair enough, player salaries are 70%. Still, how can a team rack up 1.5 to 2 years of operating costs in debt in 5 years? HOW? How can the Pohlad family justify not clean house on the entirety of the franchise operations and board if they racked up that much debt that fast?

It has nothing to do with the Minnesota Twins business operations from my understanding. The Pohlad family borrowed money for other business ventures and put the Twins up as collateral for securing those loans. Probably because the Twins would have been considered a very secure asset so it's easy to borrow against the the Minnesota Twins as a business.

I suppose it's also possible the assets acquired with loans could have been listed under the Minnesota Twins' balance sheet. If those investments failed, depreciated or were sold for a loss, the "Twins" would be forced to write the assets off, but keep the loan so it would show as a huge jump in "debt" as there would no longer be an asset to offset the loan.

[ashbury]

3 hours ago, old nurse said:

 MLB doesn’t like teams carrying too much debt. 

I didn't spot a comment that spells it out a little further, but when you say "MLB", you mean both ownership and the players union.  It's the collective bargaining agreement.  Probably the players hate debt so much that they insisted this be in the CBA.  No way in the world do they want a team with long term player contracts to say one bright day, "oops, the money is gone and we can't raise more."

I think it's fair to say that the players in effect forced the Twins to take on additional investors.

[Parfigliano]

3 hours ago, old nurse said:

https://registrationz.mlbpa.org/pdf/MLB Basic Agreement 2022-26.pdf

 

Way down in amendment 22, somewhere around page 250 there are the rules for clubs being in debt.  MLB doesn’t like teams carrying too much debt. 

MLB probably really hates owners dumping/tying debt from their other businesses onto their MLB franchise.

[Major League Ready]

1 hour ago, bean5302 said:

It has nothing to do with the Minnesota Twins business operations from my understanding. The Pohlad family borrowed money for other business ventures and put the Twins up as collateral for securing those loans. Probably because the Twins would have been considered a very secure asset so it's easy to borrow against the the Minnesota Twins as a business.

I suppose it's also possible the assets acquired with loans could have been listed under the Minnesota Twins' balance sheet. If those investments failed, depreciated or were sold for a loss, the "Twins" would be forced to write the assets off, but keep the loan so it would show as a huge jump in "debt" as there would no longer be an asset to offset the loan.

The IRS does not allow a business to borrow money for one operation and put it on the books of another organization.  Whatever they acquired would be an asset of that organization and the deft a liability.  The equity in the Twins might be collateral but that debt belongs to the organization where the acquired assets reside.  They could have done something sneaky like have the Twins purchase assets of one of their other companies for $500M but you can't borrow money for one company and put it on another companies balance sheet.

[The Great Hambino]

1 hour ago, Major League Ready said:

The IRS does not allow a business to borrow money for one operation and put it on the books of another organization.  Whatever they acquired would be an asset of that organization and the deft a liability.  The equity in the Twins might be collateral but that debt belongs to the organization where the acquired assets reside.  They could have done something sneaky like have the Twins purchase assets of one of their other companies for $500M but you can't borrow money for one company and put it on another companies balance sheet.

Oh yeah?  According to what code section or treasury reg?

There is nothing preventing a business from taking out a loan/drawing on a line of credit/etc, making a distribution of cash to owners, and then contributing that cash to another entity.  Any basis rules would not apply since there's no way the Pohlads are close to being out of basis in the Twins.  Hell, if the two businesses were both wholly-owned subsidiaries of the Pohlad Companies, the IRS wouldn't even consider the two businesses to be separate.

I'm sure there's MLB rules preventing using the club as collateral for outside interests, and at some point doing too much of this might violate some debt covenants with your bank, but the idea that there's no way to get loan proceeds into a different company's hands is just not true

My current organization just did this exact thing.  Had the bank's blessing and everything

[Major League Ready]

1 hour ago, The Great Hambino said:

Oh yeah?  According to what code section or treasury reg?

There is nothing preventing a business from taking out a loan/drawing on a line of credit/etc, making a distribution of cash to owners, and then contributing that cash to another entity.  Any basis rules would not apply since there's no way the Pohlads are close to being out of basis in the Twins.  Hell, if the two businesses were both wholly-owned subsidiaries of the Pohlad Companies, the IRS wouldn't even consider the two businesses to be separate.

I'm sure there's MLB rules preventing using the club as collateral for outside interests, and at some point doing too much of this might violate some debt covenants with your bank, but the idea that there's no way to get loan proceeds into a different company's hands is just not true

My current organization just did this exact thing.  Had the bank's blessing and everything

There are ways it could be done but there is a whole lot of speculation here with no actual knowledge of the situation.  In other words, there is a lot of guessing going on which is fine but none of us have the requisite information to do anything but speculate.   

[Linus]

Without access to audited financial statements and related subsidiaries none of know anything about the Twins finances. The most credible information in this sphere is that Forbes reported the Twins had a $19 million profit for 2023.

[old nurse]

6 hours ago, Parfigliano said:

MLB probably really hates owners dumping/tying debt from their other businesses onto their MLB franchise.

 

6 hours ago, bean5302 said:

It has nothing to do with the Minnesota Twins business operations from my understanding. The Pohlad family borrowed money for other business ventures and put the Twins up as collateral for securing those loans. Probably because the Twins would have been considered a very secure asset so it's easy to borrow against the the Minnesota Twins as a business.

I suppose it's also possible the assets acquired with loans could have been listed under the Minnesota Twins' balance sheet. If those investments failed, depreciated or were sold for a loss, the "Twins" would be forced to write the assets off, but keep the loan so it would show as a huge jump in "debt" as there would no longer be an asset to offset the loan.

Thanks to the train wreck that was the McCourts, in 2012 MLB banned borrowing against the team I do believe it was the LA Times back then.  LA Times has been behind a paywall the last few years, so I did not go drag them up. I was working nights then, and sometimes there wasn’t a whole lot to do at 3 AM 

[old nurse]

1 hour ago, Major League Ready said:

There are ways it could be done but there is a whole lot of speculation here with no actual knowledge of the situation.  In other words, there is a lot of guessing going on which is fine but none of us have the requisite information to do anything but speculate.   

No information nor understanding the complexities of the situation stopped some people from posting

[Dave Borton]

8 hours ago, Linus said:

Without access to audited financial statements ...

Hell will freeze over before any of us see MLB books.

[old nurse]

12 hours ago, Linus said:

Without access to audited financial statements and related subsidiaries none of know anything about the Twins finances. The most credible information in this sphere is that Forbes reported the Twins had a $19 million profit for 2023.

Forbes can figure out what they take in by sales tax data., television contract. They know what they spend on players. They can only guess at expenditures and corporate sponsorship income. 

[Major League Ready]

13 hours ago, Linus said:

Without access to audited financial statements and related subsidiaries none of know anything about the Twins finances. The most credible information in this sphere is that Forbes reported the Twins had a $19 million profit for 2023.

What do they know and not know.  Let’s start with revenue.  Television revenue is widely reported.  That’s the biggest share of revenue.  As @old nursepoints out, most of the remaining revenue is subject to sales tax and therefore can be verified.  Sponsorship revenue is not subject to sales tax but the sponsors are publicly traded entities so that information can be found in their financials.  Basically, the revenue side can be measured with a high degree of accuracy.

How about expenses.  We know exactly what they spend on payroll, regular draft bonuses, and their international bonus pool.  Player benefits can’t be audited but they can be estimated with a high degree of accuracy so total player related expense is roughly two-thirds of operating costs.  Other personnel and us with operating costs can’t be audited.  However, they can be identified with a high degree of accuracy and things like facilities, travel l, and personnel can be estimated with a high degree of accuracy.  To sum it up, we know almost exactly how much revenue they have and we have exact numbers on two-thirds of expenses and we can estimate the other one-third of expenses with a high degree of accuracy.

So, while it’s true we don’t have audited financial statements, the relative profitability of major league teams is not nearly the mystery that many make it out to be.  Why jump to the assumption something can’t be done if you don’t understand the process required to do it?
 

[Linus]

3 hours ago, Major League Ready said:

What do they know and not know.  Let’s start with revenue.  Television revenue is widely reported.  That’s the biggest share of revenue.  As @old nursepoints out, most of the remaining revenue is subject to sales tax and therefore can be verified.  Sponsorship revenue is not subject to sales tax but the sponsors are publicly traded entities so that information can be found in their financials.  Basically, the revenue side can be measured with a high degree of accuracy.

How about expenses.  We know exactly what they spend on payroll, regular draft bonuses, and their international bonus pool.  Player benefits can’t be audited but they can be estimated with a high degree of accuracy so total player related expense is roughly two-thirds of operating costs.  Other personnel and us with operating costs can’t be audited.  However, they can be identified with a high degree of accuracy and things like facilities, travel l, and personnel can be estimated with a high degree of accuracy.  To sum it up, we know almost exactly how much revenue they have and we have exact numbers on two-thirds of expenses and we can estimate the other one-third of expenses with a high degree of accuracy.

So, while it’s true we don’t have audited financial statements, the relative profitability of major league teams is not nearly the mystery that many make it out to be.  Why jump to the assumption something can’t be done if you don’t understand the process required to do it?
 

I’m not jumping to any assumptions. That’s precisely my point. 

[old nurse]

4 hours ago, Major League Ready said:

What do they know and not know.  Let’s start with revenue.  Television revenue is widely reported.  That’s the biggest share of revenue.  As @old nursepoints out, most of the remaining revenue is subject to sales tax and therefore can be verified.  Sponsorship revenue is not subject to sales tax but the sponsors are publicly traded entities so that information can be found in their financials.  Basically, the revenue side can be measured with a high degree of accuracy.

How about expenses.  We know exactly what they spend on payroll, regular draft bonuses, and their international bonus pool.  Player benefits can’t be audited but they can be estimated with a high degree of accuracy so total player related expense is roughly two-thirds of operating costs.  Other personnel and us with operating costs can’t be audited.  However, they can be identified with a high degree of accuracy and things like facilities, travel l, and personnel can be estimated with a high degree of accuracy.  To sum it up, we know almost exactly how much revenue they have and we have exact numbers on two-thirds of expenses and we can estimate the other one-third of expenses with a high degree of accuracy.

So, while it’s true we don’t have audited financial statements, the relative profitability of major league teams is not nearly the mystery that many make it out to be.  Why jump to the assumption something can’t be done if you don’t understand the process required to do it?
 

You jump to assumptions in determining relative profitability  CBT at the end of the year.   Gives what was spent on players, not including what they have to give all of the different government agencies.  Someone might come close to guessing travel costs. From there it is a pure guess 

[Richie the Rally Goat]

On 12/20/2025 at 11:51 AM, Major League Ready said:

Where are you coming up with the 90% number?  That would be a total of roughly 33M for all other costs. If this were true, the team would be making $150M/year.  Actually, every team would be making over $150M. 

The Twins have 942 employees according to this site.  IDK if this is accurate.  We can find the number of FO people but I would assume their are a lot more non-front office employes.   We also don't know their average salary especially given this includes a handful of very high salaries but let's use a very conservative estimate of $60K given we don't have good data, that's $56M or 17% of revenue.  Just health care costs would be $25M or 7.5% of revenue.  Their draft and international bonuses are around $20M.   That's 6%.  So, that's a total of $30.5% before considering any cost for equipment, office space, computers, travel, advertising, etc.  

 

942 employees could very well be accurate, but my guess is 400 of them are probably game day ushers and such that work 20, 5 hour shifts per season and cost 3k per year. Those part timers would not get healthcare or office space and have to buy their Twins polo shirt.

[Parfigliano]

50 minutes ago, Richie the Rally Goat said:

942 employees could very well be accurate, but my guess is 400 of them are probably game day ushers and such that work 20, 5 hour shifts per season and cost 3k per year. Those part timers would not get healthcare or office space and have to buy their Twins polo shirt.

I thought the game day ushers were an unpaid volunteer type deal

[old nurse]

1 hour ago, Richie the Rally Goat said:

942 employees could very well be accurate, but my guess is 400 of them are probably game day ushers and such that work 20, 5 hour shifts per season and cost 3k per year. Those part timers would not get healthcare or office space and have to buy their Twins polo shirt.

297 people listed by mlb.com front office page

79 people listed as minor league staff elsewhere on that site

12 coaches and manager for the major league team

26 mlb players

28 each for AA, AAA teams

30 A+

35 A

however many they want for rookie league  say 35

that. Would be about 500 people. The average team has 175 scouts 

 

you are off by at least 100

😂

[Major League Ready]

2 hours ago, Richie the Rally Goat said:

942 employees could very well be accurate, but my guess is 400 of them are probably game day ushers and such that work 20, 5 hour shifts per season and cost 3k per year. Those part timers would not get healthcare or office space and have to buy their Twins polo shirt.

Good point!  I thought about that but was too lazy to address it.

[Richie the Rally Goat]

2 hours ago, Parfigliano said:

I thought the game day ushers were an unpaid volunteer type deal

I have volunteered in a concession stand at TF, and am fairly certain almost all of those jobs are volunteer. One of my old coworkers is an usher, he sounded like he was paid hourly, but I’m not certain.

[ashbury]

1 hour ago, Richie the Rally Goat said:

I have volunteered in a concession stand at TF, and am fairly certain almost all of those jobs are volunteer. One of my old coworkers is an usher, he sounded like he was paid hourly, but I’m not certain.

I find this information so amazing and disturbing at the same time.  How does the team "sell" this to the volunteers?  This isn't some PTA running a bake sale.

[Richie the Rally Goat]

8 hours ago, ashbury said:

I find this information so amazing and disturbing at the same time.  How does the team "sell" this to the volunteers?  This isn't some PTA running a bake sale.

I believe the group i volunteered with received remuneration of some kind, 5-10% of the profit, something like that.