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I don't know why, but when you create an expansion team you need to populate the minor league team yourself if you want the expansion farm system to begin production in the first season.
Select the minor league your farm team is in (e.g. PCL, IL, TEX, etc). Go back to the same league dropdown and select league settings. Toward the bottom of that page, there's an button to fill all rosters. I think it's second from the bottom. I had to do that for each of my minor league teams to get my expansion farm teams playing in the first season. Kind of important when you've gotta develop your own guys! As an added bonus, I got a couple decent players out of the bargain too.
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