There's many factors to the decline of high school baseball JV teams and it's not just baseball. I think many sports are struggling to field JV/ freshman teams. Since this is the baseball thread, I'll attack this one.
"Local" or "House" teams are the backbone of your high school baseball programs. You have to get a group of kids at 8,9,10,11,12 years old and keep those kids together as long as you possibly can. Yes, you're going to lose a few as time goes on, but it's critical that you move the kids around at younger ages, get them experience in multiple positions so they can compete at the high school level.
One thing that happens in small communities it one or two of the "stars" of the age group leave the community and play exclusively for a travel or elite team. It's not necessarily wrong, but generally that kid's dad is probably "the guy" in the community that takes the time to put the teams together and work with the kids. So at age 10, this kid leaves, his Dad isn't going to coach kids who are not his and travel ball takes alot of time. So you have that separation right there. Those kids -- at age 10 -- if they walk away from baseball, you'll never get them back.
I would propose this for Ohio high school - or midwest states. Do not start the season until April 15th or later. At smaller schools especially, you are asking the same kids to play football from August -- December, right into basketball for 4 months, then go outside and play baseball in 35 degree weather in late March. Also, you have to extend the baseball season into June. It's insane to have a 3 month football season (4 for playoff teams), a 4 month basketball season then cram spring sports into 6 weeks. Unless a kid is dedicated baseball or track athlete, they are going to opt out of the spring sport.