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Minor-league baseball teams serve as farm systems designed to train and groom players for eventual promotion to one of the 30 major-league franchises. There are multiple levels within minor-league baseball, with the best players playing at AAA teams. Despite the fact that these ballplayers are one step away from the bright lights of Major League Baseball, salaries for minor-league AAA players are far lower than for their major league counterparts.
Major League Baseball teams have roster limits that change throughout the season. Before Sept. 1, teams hold 40 players on their major-league rosters, but may have only 25 players active at any point. From Sept.1 until the beginning of the playoffs, teams may carry 40 active players. Once the playoffs begin, teams are again restricted to 25 players.
Because major-league rosters are constantly in flux, AAA affiliates serve as both a training ground and holding pen for players on the fringes of big-league talent. This creates an unusual dynamic where the AAA rosters can be a mix of high-salary, older veterans and low-salary young players.
A U.S. citizen ballplayer in his first contract season of minor-league baseball (at all levels) can be signed for a maximum amount of $1,100 per month. After the first year, salaries are open to negotiation.
Citizens of foreign countries have different rates because of immigration policies.
All players receive $25 per day for meals while on the road.
Players who are selected in the annual Major League Baseball draft receive signing bonuses in addition to their minor-league salaries. These signing bonuses are allocated based on a slotting formula and range from more than $5 million for a first-round pick to less than $10,000 for a last-round pick.
Signing bonuses for draft picks have no impact on the first-year salary for a minor-league player, but may influence salary negotiations in future years.
A player's AAA salary is also affected by his placement on a major-league team's 40-man roster. As soon as a player is placed on the 40-man roster, he is guaranteed the major-league salary minimum -- which was $400,000 a year in 2010 -- even if he remains at the AAA affiliate.
The salary schedule for a player in AAA who isn't a U.S. citizen is determined largely by immigration requirements. As of 2010, noncitizens must receive $2,150 per month for the first contract year and no less than $2,150 per month in each subsequent year while playing for a AAA team.
Based in Boston, Nolan Kido has been writing professionally since 2006. He holds a master's degree in accounting and worked in the real estate and banking industries prior to his current career. Kido has contributed to three personal finance books and specializes in writing about taxes and investments.