Neal: Minority investors are nice, but it won’t solve the Twins’ problem

When the Twins announced last October that they were exploring a sale of the team, the future looked clearer than it does today.

That October day suggested that the winds of change were going to sweep through the organization. A new vision would be realized. And there would be an arrival of a new owner who would be willing to invest in a winner despite baseball’s current unbalanced economic system.

Yes, Twins officials stated at the time that they could decide to keep the team. But a chunk of the fan base was ready to move on.

On Wednesday, the Pohlad family said it was remaining involved in baseball, adding a couple of limited partners. Their investment will help pay down the $400 million in debt the Twins reportedly have accumulated.

There are a bunch of unanswered questions this development creates. The first question is for the Pohlad family.

Are you people nuts?

I write that with absolute respect. I watched Joe Pohlad work various jobs within the organization before becoming executive chair. Getting an audience with Jim, his uncle, wasn‘t that difficult when he was in charge. And I still remember interviewing Carl Pohlad in his Marquette Bank office in 2002 as he needled me for not financing my new home through his bank.

That contract certainly won’t be awarded by the Twins.

According to Spotrac, the Twins currently have a $125.7 million payroll, 20th in baseball out of 30 teams.

Payroll isn’t the end-all.

The Brewers payroll is less than the Twins but they have the best record in baseball. But it sure can help add talent to a roster. The Dodgers, Mets, Yankees, Phillies and Blue Jays are spending at least twice as much as the Twins on players; and the Dodgers are spending nearly five times as much as the Marlins.

If the Twins can’t fund a winner, this is a good time to sell.

Per the Collective Bargaining Agreement in MLB, teams share 48% of their local revenues, which includes local television deals, into a revenue-sharing pool. That total is then divided up among the 30 teams.

There has been talk of raising that percentage. I suggest raising it to 100%.

But the big market teams, the ones getting nine-figure local TV deals to help fund their payrolls, don’t like the idea. Time will tell if the “we’re all in this together” argument will eventually resonate with them.

We know from court documents submitted during the Diamond Sports Network’s bankruptcy hearings that the Twins received $54 million in local TV revenue in 2023.

Major League Baseball has taken over the production and distribution of the Twins’ local games for the 2025 season. Expectations are that revenue has been much lower in each of the two seasons since 2023.

So about $100 million of that $400 million in debt probably comes from two years of decreased TV revenue and Correa’s contract.

A solution to television revenue won’t come before 2028. That’s the year Major League Baseball Commissioner Rob Manfred hopes to be able to take over control of teams’ local television rights, bundle them and sell them to different platforms. Many teams’ deals expire after 2027, making that bundling possible. The NBA, for example, is showing games on ESPN, ABC, NBC and Amazon this upcoming season — for $77 billion over 11 years.

MLB is currently completing due diligence on background checks and finances of the two limited partners. Approval will come sometime following the end of the season, with the Twins hoping it is completed before the end of 2025.

Then the Pohlad family has heavy lifting to do here.

Communicate what the 2026 payroll will be. How about signing Joe Ryan to a long-term deal? A splashy move will reveal how serious they are about making things right.