If Alex Rodriguez is suspended for all of 2014, his $31 million salary won't count toward the Yankees' payroll.
The New York Yankees made the first big-name, big-money free-agent signing of this offseason by signing catcher Brian McCann last week, but when and what their next moves might be depends at least in part on you-know-who.
Even though his appeal hearing, steeped in over-the-top antics, is finally over, Alex Rodriguez's status remains the great unknown that has impacted the start of this year's free agency—for the New York Yankees as well as the other 29 teams.
It could stay that way until January, too, since that's when arbitrator Fredric Horowitz is expected to hand down his final decision on the matter of Rodriguez's 211-game suspension for his alleged involvement in the Biogenesis scandal.
At this stage, with both Rodriguez's camp and Major League Baseball having presented their cases, the fate of the Yankees third baseman is in Horowitz's hands. That fate will be one of the following:
- The 211-game suspension will be upheld in its entirety
- The suspension will be decreased to any number Horowitz deems appropriate
- The suspension will be eliminated altogether
The reason Rodriguez's appeal has been such a story—aside from all the juicy details and drama along the way so far, that is—is because the Yankees have continued to indicate their plans to get their 2014 payroll under $189 million in order to avoid and reset the luxury-tax penalty. Or so say the Steinbrenner family and general manager Brian Cashman.
It long ago became obvious that Rodriguez's contract—all $86 million, minimum, that's potentially left of it through 2017—had turned into an albatross, even for baseball's most financially powerful franchise. But now? Well, Rodriguez's salary in particular for 2014, which is at least $25 million but could jump to $31 million if he hits merely six more home runs, has gone from an albatross to an ACME anvil that's weighing down the Yankees' options on the open market.
That's because Rodriguez's pay next year may or may not be on the books, depending on Horowitz's decision. If Rodriguez is suspended for being linked to performance-enhancing drugs, he doesn't get paid while banned. If not, though, the club will have to account for that extra $31 million on its ledger, or at least whatever prorated portion of it that applies if the suspension is reduced to, say, 50 or 100 games.
The Yankees' 2014 offseason plans might as well be on the disabled list with a hamstring problem.
Then again, the club did just ink McCann to a five-year, $85 million deal—that adds about $17 million to next year's payroll—so it's not as if there's nothing that can be done. There is some "wiggle room," perhaps enough to allow for, oh, a $300 million spending spree, as was reported in October.
The Yankees' choices, though, are likely to be determined by timing as much as anything else. Because the team is, in some ways, at the mercy of Horowitz's decision, it may be forced to wait until the new year to make any more major signings and moves. Since it's impossible to know which way things will turn out, let's explore all three, shall we?
The Yankees' 2014 Payroll
First, though, let's start with the basics. After re-upping with captain Derek Jeter for $12 million and backing him up with Brendan Ryan for another $2 million, the Yankees were in line for about $115-120 million in payroll commitments for 2014, counting their arbitration-eligible players.
With McCann's $17 million average annual salary (assuming it's spread out evenly through five years) added to the mix, that brings the figure somewhere in the range of $130-$135 million, give or take.
To stay under $189 million, then, the Yankees have no more than roughly $50-$60 million left to spend*, it seems. And that's without Rodriguez's salary, which would cut that amount in half, factored in.
See how this could get tricky for Cashman and Co.?
*Please realize that even amid all of the controversy surrounding Rodriguez and turnover to the Yankees roster, the team still has enough mess-around money to more or less cover the Tampa Bay Rays or Oakland Athletics rosters. So keep some perspective.
If Rodriguez Is Suspended for 211 Games (All of the 2014 Season and Then Some)
This would mean the Yankees wouldn't have to pay any of Rodriguez's salary, so they'd have that $31 million off their books, ready to be used how they see fit.
That would be the ideal scenario for the team, which still has plenty of holes even after landing McCann, namely in the rotation, infield and bullpen.
Cashman's top priority in this case, one imagines, would be to re-sign Robinson Cano, the team's longtime star second baseman who is the biggest name on market this year. Of course, if the Yankees don't get word of Horowitz's decision before Cano can find another suitor or two who is ready to pay him what he wants or close to it, that could make things much more problematic for the Yankees.
If that all does work out, though, and Cano returns to New York for, say, $25 million per, there would still be about $25 million more to spend on a starter or two, some bullpen help and possibly another utility/backup infielder.
The Yanks might not be able to get in on the likes of Ervin Santana, Ubaldo Jimenez or Matt Garza for their rotation, but there are other, cheaper options that fit the innings-eating mold, like a Scott Feldman, Bronson Arroyo or Paul Maholm—assuming, of course, that one or two of them are still unsigned into late December or January.
In other words, if Rodriguez is suspended for all of next year, the biggest issue the Yankees will have is that the timing of that decision will automatically pare down their choices.
If Rodriguez Is Suspended for 100 Games (Equivalent to a Second Offense)
This would mean the Yankees would have to pay a prorated portion of Rodriguez's salary—about one-third—which would come out to about $10 million or so, if we're going by $31 million.
That's a lot less to have to worry about, for sure, and Cano could still fit into the picture, but it's still enough to eat into the likely amount it would cost to sign one of those three lower-tier arms mentioned above or, say, infielders Omar Infante or Juan Uribe.
In other words, even if Rodriguez is suspended for two-thirds of next year, the Yankees will have the timing handicap as well as a financial one.
If Rodriguez Is Suspended for 50 Games (Equivalent to a First Offense)
Again, this would mean the Yankees would have to pay a prorated amount of Rodriguez's 2014 salary—about two-thirds—which works out to roughly $20 million.
This scenario certainly would limit the team's options, as the money due Rodriguez would eat up almost half of what remains in order to stay under $189 million next year.
Cashman would have to be much more discerning in targeting which of the still-available players he needs most to address the roster problems. More than likely, in this case, the Yankees would be limited to bringing in only one more high-priced free agent.
In fact, if the club winds up owing Rodriguez $20 million, it might be a stretch to retain Cano at an additional $25 million per and still field a competitive team, particularly on the pitching front.
The other option in this case? Turn to the trade market to find cheaper players in an attempt to fix any remaining holes.
If Rodriguez Is Not Suspended at All
Frankly, considering how tight things become if Rodriguez is suspended only 50 games, it's hard to see how the Yankees could even consider bringing back Cano and still manage any other maneuvering.
If all of Rodriguez's $31 million is counting toward the 2014 payroll, simply re-signing Cano for something close to $25 million would more or less put the Yankees on the precipice of once again surpassing the luxury tax and paying another hefty penalty.
If this one plays out, Cashman might have to say so long to Cano and look to ink, say, Infante to play second then make due by picking from the bargain bin when it comes to starters.
Even trading would be tricky here, as the Yankees would have to swap out salary in any deal, making such a transaction all the more unlikely.
Forget the idea of adding a starting pitcher or another infielder. Or...forget the idea of staying under $189 million altogether.
The Bottom Line
While the numbers and figures aren't set in stone just yet, it appears that the biggest hit to the Yankees' plans this offseason would come if Rodriguez is suspended for 50 games or fewer.
That's more or less the tipping point where Cashman would have to determine whether Cano is worth it, or if it would be better to shop on the cheap and get two or three useful players to complement the aging, injury-prone roster that's already in place.
Of course, as much as the money is an obstacle in all of this, timing is just as key. Because even if the best-case scenario plays out for the Yankees—Rodriguez's suspension is upheld and his $31 million goes away—and they wind up not being beggars (relatively speaking, of course), they still won't have as many choices either.