Last week I wrote a speculative piece on how a potential 26th roster spot would affect the Blue Jays going forward. It was supposed to be the only lock in the new collective bargaining agreement. Well, the union and MLB finally agreed on the framework for a new CBA…and roster sizes are staying exactly the same. That being said, There are many other changes and it would be good to see just how much those will adjust how the Jays do business.
Luxury Tax/Revenue Sharing
While many expected the luxury tax threshold to rise to $210-215M to represent the growth of the game since the last agreement, the MLBPA was actually only able to gain an increase from $189M to $195M for the coming season. That number will rise to $197M in 2018, $206M in 2019, $209M in 2020 and $210M in 2021.
There are also stiffer penalties for teams that exceed the tax, with higher tax rates for both new and repeat offenders, and even the potential of draft pick changes if a team is too far above the stated level.
While this change has no direct effect on the Blue Jays (they won’t come close to $195M), it will certainly change how their division rivals do business. Both the Yankees and Red Sox are already up against the tax number, and in Boston’s case specifically it will reportedly stop them from going after top level FAs like Edwin Encarnacion.
On the flip side, the revenue-sharing system seems to help the richest clubs , as there is no longer a multiplier for the top earners (meaning they consistently pay more). This helps New York (who also receives a reduction for paying for their new park), LA and Boston, but not enough to offset the damages of luxury tax penalties.
Result: Positive for Toronto
International Free Agency
MLB entered these negotiations pushing for a draft, and while they didn’t get it, they got what they wanted anyway: Extreme cost certainty. While in the past CBA teams had bonus pools which they could exceed if they were willing to pay penalties as well as slots they could trade to other teams (the Jays used this to get Vlad Guerrero Jr), the new system has put in place a hard cap that ranges from $4.75M to $5.75M per team based on market size.
These changes are shocking, as the MLBPA seemed to be actually putting up a fight for amateur rights. So much for that.
For reference as to how much this hurts, eight players have agreed to IFA bonuses for $4M or more on their own, including Yoan Moncada who was given a whopping $31.5M by the Red Sox, with a 100% penalty on the overage (bringing the deal closer to a $60M cost for Boston).
Guaranteed costs are beneficial to all clubs as it relates to spending, but it should have an additional side benefit to the Blue Jays. Neither Alex Anthopoulos nor Mark Shapiro (when in Cleveland) were known for throwing big amateur money around, and the Jays’ budget was typically in the $3-4M range before getting into penalties (they actually went over slightly to sign Guerrero).
With the new rules, rich clubs like Boston, New York, Chicago, and Los Angeles can no longer just blow by their bonus caps and pay overage penalties, which means the Jays can now compete for all the top amateurs. This is also true of all other clubs, but the smaller market teams usually had a lot more to work with than Toronto. It remains to be seen whether the Jays are considered a “big club” or “medium club,” but the dollars are still so close that they should be able to be competitive for any player they wish to pursue.
There is an interesting potential loophole to the bonus limits, however, and we will have to wait for the final language to see if the CBA closes it:
Loophole to watch for in new CBA. Teams signing int'l players then trading them to teams who have hit hard cap limit.
— JJ Cooper (@jjcoop36) December 1, 2016
Teams love exploiting those sorts of holes, so that will be one to watch for.
In addition to the bonus limits, Cuban free agents now must be 25 years old to be exempt from bonus pools, up from the previous cut off of 23. This means that the pool of Cuban players will be slightly smaller, and that teams can no longer get them while they’re still “prospects” like Lourdes Gurriel, but that will only affect one or two players a year.
That said, this new change could have a HUGE impact in Japan if the new rules apply to them as well.
This means Otani stays in Japan for 3 more years. https://t.co/BbyPPWepo3
— JJ Cooper (@jjcoop36) December 1, 2016
If Shohei Otani is not allowed to come over for another three years (without being subject to bonus limits), this is a huge benefit to the Blue Jays. He projects as a true ace, and it’s very unlikely the Jays would ever pay the money required to sign him. If nobody else has him, that’s even better (though bad for baseball). This one is still up in the air though, and we’re going to have to wait for full language to see if it applies.
Result: Positive for Toronto
Qualifying Offer System
While the actual qualifying offer is unchanged (a one year deal at the average of the top 125 salaries), the effect of signing/losing a qualified free agent has undergone a massive overhaul.
Rather than attempt to breakdown the extremely convoluted rules, I am just going to include a screengrab from the AP story linked at the top of this piece.
There are actually some slight disagreements on what kind of draft compensation is awarded to the team that loses the player, as Jayson Stark is reporting that there is an extra tier beyond “luxury tax paying’ and not, and that the $50M contract only affects teams in the smallest markets.
This rule doesn’t apply until next offseason, so Edwin Encarnacion, Jose Bautista, and potential signings like Dexter Fowler are unaffected.
Looking to the future, the Blue Jays have two players who could have been considered for 2017 qualifying offers: Francisco Liriano and Marco Estrada.
With the new rule that players can only be given an offer once, Estrada is off the table. Liriano, however, is definitely affected. Even if he has a good year, there are slim odds of him getting a deal worth more than $50M (and in fact, this CBA encourages the smaller deal). This means the penalty for signing him will be limited.
However, that means the return to the Blue Jays would also be limited to a pick after the second round. That isn’t enough of a reward to risk a non-star player accepting an offer of approximately $18M. So this likely means no QO for Liriano.
This same calculus will have to go into play in trade discussions for rumoured targets like Jay Bruce, Curtis Granderson, and Carlos Gonzalez. Each of those players is a pending free agent. With the promise of a first round pick at the end no longer part of the deal, the trade packages will undoubtedly change somewhat.
When it comes to signing qualified players next offseason (and beyond), the Jays are in a bit of a tough spot. While they now won’t have to give up a first round pick, the $500K international bonus pool loss combined with the second pick is significant. This likely means the Jays will only pursue top free agents who receive qualifying offers.
Result: Slightly Negative for the Blue Jays
Expanded Regular Season and Shortened Disabled List Time
While not exactly the sexiest parts of the new CBA, the lengthened regular season (187 days up from 183 starting in 2018) and the shortening of DL stints (from 15 days to 10) will likely have the most visible impact on the Blue Jays.
It’s no secret that the Jays have a few players who are a little bit prone to getting banged up. Troy Tulowitzki, Josh Donaldson, Devon Travis, and Russell Martin all suffer their share of bumps and bruises, and that’s before getting into whoever they pick up as the offseason continues.
With the ability to return a player from the DL within 10 days, teams will no longer have to guess on those 5-6 day injuries that could turn into more (I’m looking at you, Travis). Now they can put them on the DL right away and summon a replacement without having to worry that they’ll be without a healthy regular for 8-10 days. This could mean no more two man benches where one is Josh Thole. That’s nothing but good news.
This becomes even more valuable once the new schedule kicks in for 2018. Not only will extra days off mean fewer DL days are actually game days, but the four extra days will provide the rest that some of the Jays’ aging veterans so often require.
Note: There are many who believe the 10 day DL will mean fifth starters get skipped by being sent to the DL, allowing the team to call up a replacement bench/bullpen option. While this type of gaming of the system is certainly plausible, the MLB would likely push to alter the rule if it is wholly abused.
Result: Hugely Positive for the Blue Jays.
Draft Bonus Pools Increasing
With the new agreement, the drop off in slot values from the top picks to later picks in the first round will no longer be as steep (meaning higher values at the back).
With the 24th pick, the Blue Jays stand to benefit from this change, and even more so if it extends to the supplemental picks that the Jays will receive for Encarnacion and Bautista.
While this does mean the Jays lose a bit more if they sign a qualified free agent like Fowler, it likely isn’t enough to really dissuade the front office.
Result: Slightly positive for the Blue Jays
There are a bunch of other little details in the CBA, like the All-Star game no longer deciding World Series home field (it’s about time), a slight increase in minimum salaries (meh), the grandfathered elimination of tobacco products, and many other little minutiae that will filter out over the next few days and weeks, but they don’t/won’t have the same direct impact on individual clubs.
Most importantly, baseball once again has labour peace for another five years. The Winter Meetings will start on time, and the sport we all love will continue to operate and grow.
Lead Photo: Dan Hamilton-USA TODAY Sports
Doesn’t Otani already have four years of professional experience? Wouldn’t that mean just two more years in Japan, even if the Cuban rule affects all international players?
Nope, because he’s only 22 (with a July birthday). He’d need to be 25 in order to be able to come over and be exempt from the bonus pool limits.
I still don’t understand why the MLBPA didn’t seem to have any real interest in raising salaries more for pre-arb players. For example, maybe some kind of scheme where the minimum salary increases if a player has reached one and then two years of service time. Seems like that would benefit more members than changing the QO system, which will benefit far fewer. Not that it was either/or.
I imagine that’s something for which the owners would have demanded a major concession elsewhere.
That’s quite possible, but what I don’t get is why fixing the QO system, which only affected 10-15 players a year, so they can make even more millions than they would make under the old system, is a bigger priority than a change that would benefit a far larger number of the PA’s members. It’s also arguable that an additional say $100k would be quite meaningful for many of those players whereas a few $M more across a multi-year deal carries little if any incremental value for players who are being offered $17M for one season.
So, for me at least, it seems like the PA prioritized the interests of a few about to be or already very rich members over those of a much larger portion of its rank and file membership, which seems upside-down.
Well, they did get a small increase (about $35K and going up slightly in the following years). But I think the union really is about the top end money going up, because that drives up all salaries beneath it.
Though I do agree that the base salaries affect way more players.
Increasing the minimum for pre-arbs by say $100k would cost relative peanuts while benefiting many more players. If, for example, after factoring in injury replacements et al over the course of the season, teams would average the equivalent of 10 full-season pre-arbs, that’s $1M more per team.
So, I don’t agree that MLB would have asked for much in return. Indeed, I’d guess that with only a bit more effort, the PA could have gotten it without giving up anything.
“This likely means the Jays will only pursue top free agents who receive qualifying offers.”
Is this a typo that should read … “who don’t receive QOs” …? or am I not understanding this argument/analysis?