Phillies: Dollars and sense before spring training
While Phillies stupid money would satisfy their loudest critics, it doesn’t mean unlimited financial spending by general manager Matt Klentak and the decision-makers above him on the totem pole.
Negotiating required:
Positive vibes are contagious among the Philadelphia Phillies faithful because previous doubts and rumors are falling by the wayside. But last offseason, the market changed, and players are discovering it wasn’t an oddity: Many clubs aren’t agreeing to longer and more expensive contracts for top-tier free agents.
IN OTHER WORDS: “A million dollars isn’t what it used to be.” – Howard Hughes
Regarding offers, organizations don’t want to lock in a roster slot for 10 campaigns or more and commit $325 million plus. And they also aren’t for shorter-term pacts with high AAVs (average annual value): $35-40 million per 162. A new normal?
Luxury Tax penalties for first overage:
- 20 percent for every dollar over $206 million.
- 32.5 percent for every dollar over threshold if over $226 million.
- 42.5 percent for every dollar over threshold if over $246 million and a ten-space drop in the MLB Draft for their first selection after the sixth overall.pick.
One reason is surpassing 2019’s competitive-balance threshold of $206 million. Yes, many deep-pocketed franchises favored to sign the top free agents would easily exceed the tax-rate line with a $20 million AAV acquisition. And those increased penalties have discouraged teams from unlimited spending.
Of course, the market is also sluggish due to agents like Scott Boras and stars expecting big paydays. However, those days might be ending due to Klentak’s current lack of competition.
As for the Phillies, their philosophy is to exceed the competitive-balance threshold if the player will give them an excellent shot to win the National League Championship. But everything has been short of that for years, and ’19 is no different due to the rotation’s shortcomings.
Why are some fans questioning the Phils lack of stupid-money lavishness? Because their reasoning is incomplete due to the absence of obstacles: competition, rules, financial information, and a limited time frame to name four.
Top-shelf acquisitions:
For first-time free agents in 2020 and 2021, their agents are now making them aware of the changes they will be facing during the next two winters. In other words, the sky is no longer the limit.
All of you 1-3 yr players out there better be paying attention to what’s going on in our game. You’re next. @MLB
— Jake Arrieta (@JArrieta34) January 12, 2019
As Jake Arrieta realized last March, his asking price of $210 million for seven seasons was too costly for even deep-pocked organizations. And he received $25 million annually for three summers instead of $30 million each for seven. So, he’s informing Aaron Nola, Rhys Hoskins and others of the new normal.
Concerning the market, Dallas Keuchel probably won’t be receiving a proposal near $100 million for five campaigns. Moreover, the Phillies may offer $60 million for four years, but that depends on the AAV for Bryce Harper or Manny Machado. Another March deal?
Expecting a minimum of $325 million for 10 seasons, Machado only has two or three suitors: the red pinstripes, the Chicago White Sox and –maybe– a mystery team. Reportedly, Chicago’s proposal was a recently questioned $25 million for seven summers or $175 million.
Harper’s offer from the Washington Nationals was $300 million for 10 campaigns. But after Washington’s offseason spending is that still on the table? Basically, the Nats have $4.4 million before they cross the Luxury Tax line, and $30 million AAV would even exceed the additional $20 million mark.
Organizational methodology:
Even if $30 million AAV is sufficient for Harper or Machado, the $206 million competitive-balance threshold means a franchise must be at $176 million max. So, the Phillies, White Sox and St. Louis Cardinals are in the mix without triggering a penalty.
Estimated AAVs per Roster Resource:
- Competitive-balance threshold: $206 million.
- Phillies: $156.4 million.
- Yankees: $224.2 million (updated Jan. 18).
- Dodgers: $190.3 million.
- Cubs: $225.1 million.
- Nationals: $201.6 million.
- Cardinals: $166.7 million.
- White Sox: $109.5 million.
In Chicago, the Cubs are already $19.1 million over. On the other hand, the rebuilding Chisox are only willing to offer a so-called $175 million for seven years, and they are waiting to ink Machado if the Phils sign Harper. Yes, other GMs study each other’s financials and tendencies.
As for St. Louis, they are giving Paul Goldschmidt the “baseball heaven” treatment because their likely plan is to re-sign him. Ergo, he is their Harper or Machado. And they are probably hoping for a hometown discount to boot.
Regarding the New York Yankees, they need a left-handed threat like Harper, but they have Aaron Judge and Giancarlo Stanton as corner outfielders. Therefore, moving Stanton could make positional and financial room for Harper (see updated amount above).
The Los Angeles Dodgers need a right-handed bat like Stanton due to a left-heavy lineup. But keep in mind, their front office is the former management of the Tampa Bay Rays, and they can only exceed the Luxury Tax line by $15 million to avoid the competitive-balance penalty.
Concerning the Nationals re-upping Harper, their season-ending proposal of $300 million for 10 summers is probably no longer valid because they would surpass the second Luxury Tax line of $226 million. Ergo, Washington would be at $231.6 million if they re-sign Harper for $30 million AAV.
Crossing the finish line:
While many fans imagine a dream team assembled during the offseason, Harper, Keuchel and Craig Kimbrel won’t be on the active 25. Harper probably will be, Keuchel might be, but all three won’t be.
The #Phillies, according to team executives, have visions of signing Harper,
— Bob Nightengale (@BNightengale) January 15, 2019
Keuchel and Kimbrel.
At $156.4 million, the Phils have $49.6 million, and $206 million is an amount they won’t exceed without a solid shot at the NL pennant. In other words, Harper at $30-35 million and Keuchel at $15-20 million are a doable $45-55 million. And remember, Klentak already has David Robertson under contract.
As for Nola, his arbitration figure was $6.75 million, the Phils’ offer was $4.5 million, and Roster Resource estimated $6.6 million in their $156.4 million tally. Basically, this is a negotiation in progress, and the red pinstripes will probably agree to $5.75 million.
Many locals don’t realize an additional $1 million gives management more room to sign Harper and Keuchel. Usually, negotiations have higher asks by players and lower proposals by clubs. And keep in mind, if Klentak can add Keuchel, it will be due to keeping payroll down with Harper as well.
While some national publications expect Harper to be a February or March signing, Boras knows the Phillies offer will be more lucrative than the White Sox’s. And because the Phils have leverage as a result, what could the super agent decide to do instead of delaying the inevitable? Strike first!
Next. Phillies: Trading veteran bullpen loose ends. dark
If you have any questions or opinions regarding Philadelphia Phillies players, please open the comments section.