The front office of the New York Yankees decided to lower the overall payroll in recent years with the thought process that a competitive team can be built without expensive players at every position.
During an interview with Bill Baer of NBC Sports, New York Yankees general manager Brian Cashman alluded to his concern of not wanting “to line the pockets of opponents to use that against us.” True to his word, the Yankees have seen a decrease in the amount of luxury tax payments they have owed in recent years. For example, the organization paid $27.4 million in 2016, $15.7 million in 2017, and $0.00 in 2018.
The organization was able to achieve its goal of staying below the luxury tax threshold ahead of the current off-season, but it may have played a role in the current stretch of nine straight regular seasons without a World Series appearance. Even though making it to the Fall Classic is not an easy task, ever since the organizations first trip to the World Series in 1921, there have only been two other World Series droughts (1965-75, 1982-94) longer than the current drought.
The last time the Yankees spent a significant amount of money in one off-season came during the 2013-14 off-season when they dished out a massive $503.00 million in overall salary. As the 2014 season marked the final season for long-time captain Derek Jeter, the Yankees attempted to put together a competitive team through free agency to attempt one last postseason run in the Jeter era.
Although they allowed Robinson Cano to sign with the Seattle Mariners, the organization was able to bring in Masahiro Tanaka, Jacoby Ellsbury, Brian McCann, Carlos Beltran, and Hiroki Kuroda alongside Jeter and others with the $503.00 of salary spent. Unfortunately for the Yankees, they were unable to reach the postseason for the second straight season, which likely caused the organization to go in a different direction.
This different direction involved making moves to keep the team under the luxury tax threshold ahead of the 2019 season. Due to this, in the ensuing off-season, the Yankees passed on free agents such as Max Scherzer, Jon Lester, James Shields, Hanley Ramirez, and David Robertson. Instead, they chose to re-sign Chase Headley (four-years, $52.00 million) and sign Andrew Miller (four-years, $36.00 million), Stephen Drew (one-year, $5.00 million), Chris Capuano (one-year, $5.00 million), and Chris Young (one-year, $2.50 million).
Ahead of the 2016 season, the Yankees passed on free agents such as Zack Greinke, David Price, Justin Upton, Ben Zobrist, and J.A. Happ. Instead, they made zero free agent signings. Ahead of the 2017 season, the Yankees passed on free agents such as Edwin Encarnacion, Justin Turner, Kenley Jansen, Dexter Fowler, and Josh Reddick.
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Nonetheless, the organization made two solid additions during the 2016-17 off-season by signing Aroldis Chapman (five-years, $86.00 million) and Matt Holliday (one-year, $13.00 million). They also signed Chris Carter (one-year $3.50 million) to fill in for an injured Greg Bird at first base. However, during the 2017 regular season, the team continued to make financially conscious decisions by choosing to pass on placing a waiver claim on Joey Votto, Giancarlo Stanton, and Justin Verlander.
Ahead of the 2018 season, the Yankees passed on free agents such as J.D. Martinez, Yu Darvish, Eric Hosmer, Jake Arrieta, and Carlos Santana in order to ensure their luxury tax goal was fulfilled. Although they were able to acquire the reigning NL MVP in Stanton, the payroll still decreased after they shipped out Starlin Castro and Headley in separate trades in order to clear payroll space for Stanton. The only MLB signings they made in the 2017-18 off-season were C.C. Sabathia (one-year $10.00 million) and Neil Walker (one-year, $4.00 million).
Although the aforementioned moves allowed the organization to succeed in reaching their goal of dipping below the luxury tax threshold for the first time in 15 years, the team was unable to capture an AL East division title for the sixth straight season, despite winning 100 games in 2018.
The luxury tax threshold will be $206.00 million for next season, followed by $208.00 million in 2020 and $210.00 million in 2021. Even after the recent free agent signings of Sabathia (one-year, $8.00 million) and Brett Gardner (one-year, $7.5 million), the Yankees currently only have $103.80 million committed for next season. Following their expected arbitration costs, as estimated by MLB Trade Rumors, the Yankees should have roughly $158.00 million committed for next season.
Even after factoring in player benefits and minor league salaries, the Yankees may be able to add multiple free agent pieces between now and the beginning of the season. As the luxury tax thresholds will likely keep marginally increasing even after a new collective bargaining agreement is put into place, the organization likely has plenty of room to work with in order to improve the roster and give the team its best chance at returning to the World Series in 2019.