What Does Purchased Contract Mean?

[Le Grande Orange]

Originally Posted by Assos

Also, you have to remember that some minor league ball clubs are not owned by their big league teams...

Actually, most minor league clubs are not owned by their major league parent.

Originally Posted by RchW

The Tides had nothing to do with the Mets going to Vegas. Buffalo refused to re-sign with the Mets and the Jays had a better deal for Buffalo. The Mets had few options other than Las Vegas. Same thing happened some years ago when Syracuse tossed the Jays.

That's right. It's a consequence of the agreement between MLB and the NAPBL which requires major league clubs to support 160 minor league affiliates (excluding those in the AZL, GCL, DSL, and VSL). So whichever minor league and major league club is left after the new affiliation swap dance is over are forced together.

[Déjà Bru]

Originally Posted by Biggio509

A historical footnote to LGO's explanation. All of these terms come from prior to when the minor league clubs were owned by major league teams. Prior to the 1930's minor league clubs were independent for the most part. The transactions were more like European football. Even in the 1930's when clubs were buying farm teams, the major league club did not own the contracts. The two clubs were owned by the same people though so owners could move players between clubs at will. The formal buying and selling of contracts still had to happen because they were in essence two different teams and two different businesses. Today the minor league system is consolidated. The MLB club owns players contracts and in essences loans players to an affiliate who maintains the stadium and gets any profit from ticket and merchandise sales.

Today, the terms still exist from when the minor league league club owned the contract. That is why when a player is moved to the majors his contract is purchased. Prior to the modern system they actually bought the contract from a minor league team. Today it is just a term because the major league team owns the contracts and provides players to its affiliate club who maintains the stadium and gets ticket and marketing revenue. So it is an antiquated term that really does not accurately describe what happens today.

Options back before the modern system were sale/buy back contracts. So if a major league club wanted a promising young player who wasn't read they would give him a contract. They would then sell them to a minor league club with the "option" to buy them back at any time. Again this doesn't fit what happens today but the old term exists. In the early 1900's rules for these option contracts were created and the term was never changed. The term option has survived even if there is no such thing as a team selling a player to a minor club with the option to repurchase the contract.

The terms make a lot of sense in the historical context when independent minor league teams owned the contracts but not really in today's setting where the MLB club owns the contracts and allows an affiliate the rights to use a player. Still these terms have been in the rules for over a century without anyone changing them. It is kind of like states never pulling laws for how many horses can be tied to a public post from the books. The rest of the terms are modern and have been in use only since the MLB clubs have owned all minor league player contracts.

I just added portions of this to the note file that I mentioned before.