Mid-Market MLB Method: Lock Up Now or Wait Until After Arbitration Years
When the Tampa Bay Rays opened the 2008 major league season, third baseman Evan Longoria was playing for the Durham Bulls in the Triple A International League.
It was the minor leagues for the Rays first choice in the 2006 draft, and was the third overall pick. Many people, including myself, suggested the Rays were trying to save themselves some money by delaying Longoria's "arbitration clock" by sending him to the minors.
Isn't the idea to try and win games? Longoria was the Rays best opportunity at third base to help them win, but was mired in Triple A for financial reasons.
But being mired lasted all of seven games and 25 at bats, before Longoria was promoted to the majors. The Rays were going to let the clock start early on their prize after all.
But even the Rays startled everyone by signing Longoria the next day to a six year, $17.5 million contract through 2013 including three club options for 2014-2016. The Rays bought out all of Longoria's arbitration years and his first three free agent years with club options.
Based upon Longoria's performance, the team has made out very well. Even though they gambled on an unproven young talent and are going to save a bunch of money over the long haul.
This buying out of a players early "control" years is a growing trend which began in the early-to-mid 1990's by General Manager John Hart when he was with the Cleveland Indians. He signed up youngsters Kenny Lofton, Sandy Alomar, Jr., Carlos Baerga, plus Joey and Albert Belle to multi-year deals WHILE they were really good...and really young.
For example, Lofton has a 7.7 WAR* in 1994 (shortened season due to strike), the highest in baseball that season and his WAR was 7.3 in 1993. He made only $925K that year and $1.925 million in 1995. His salary would have been much higher had Lofton actually gone to arbitration in 1995.
*That is the first time I used the WAR stat in any article ever. While I am not needing to be rushed to the hospital, I am still in shock. It was needed for reference on how good Lofton was those seasons. Don't expect it all the time.
Hart needed to do this to keep together what he projected his core would be for many years at reasonable prices than what these players would receive through arbitration and early free agency. As a smaller market team, Hart reasoned the Indians had a smaller window to win.
Signing up young players is a great tactic for these small market** teams to use.
**I love the term small-market. With all these billionaire owners, they can afford to spend their OWN PERSONAL money on players. I don't mean to spend frivolously big on free agents like you are Omar Minaya, but to spend to keep the players your organization develops.
Why then are there small markets when these guys have their own money they can spend. Before he died, Carl Pohlad of the Minnesota Twins was the richest owner in baseball but did not spend money. Lucky the Twins re-signed Kirby Puckett when Carl was alive, but I am not so sure he would have signed Joe Mauer to that contract last off season.
Should other small-market teams use the same ideas?
Of course, they should. They have to in order to compete with the so-called big boys of Boston, New York, Los Angeles, and Philadelphia.
But these big teams do the same thing.
The Red Sox signed Jon Lester, Dustin Pedroia, and Kevin Youkilis to long term deals before even going to arbitration on Lester and Pedroia and after the first arbitration year for Youkilis. I fully expect them to extend Clay Buchholz after the 2011 season.
They want to see players perform for two or three seasons before they sign players longer term. This allows for any adjustment periods the league makes to the players after their rookie and sophomore seasons.
The Yankees also did that with Robinson Cano two seasons ago and even Derek Jeter, who was signed to a ten-year deal after his second arbitration year. Yankees would probably sign Phil Hughes to a multi-year deal, too, after 2011, buying out several arbitration years and maybe a free agent year or two.
Even the Philadelphia Phillies tied up their young guys Jimmy Rollins, Chase Utley, and Ryan Howard, who were tied up after their first arbitration years.
There is quite a bit of talk now about the MLB financial statements for several teams being made public. These statements put teams like Pittsburgh and Florida into bad light, and for once it was not about their on field records. They show that the teams have made tens of millions of dollars but have not put that much of that money into player salaries.
These teams need to start signing their young stars when they believe their young players are going to be well-above average for the long haul. This is tricky because if you jump too soon on a player, you could be left holding the bag at big dollars for very little in the way of results.
Similar to what Scott Kazmir and Nate McLouth have become.
But certain smaller-market teams have reaped the benefits of signing young talent early, like Milwaukee with Ryan Braun, Yovani Gallardo and Corey Hart, the Marlins with Hanley Ramirez and Josh Johnson; and the Mariners with Franklin Gutierrez and Felix Hernandez.
Other teams like the Braves with Brian McCann (and likely Jason Heyward soon), have done this.
The Pirates have a couple good, young talented ballplayers in Pedro Alvarez and Andrew McCutchen. Alvarez is signed through 2014 (including club options), but it would be good to spend some of that profit and also sign McCutchen after his first full season to a long-term commitment, saving long-term money.
The smaller-market teams need to decide who the players they want to keep. Not just "team" players who can be replaced cheaper through from their farm system, but players who already have been All-Stars.
And who they feel will continue to be All-Stars and league leaders, not league average.
McCutchen appears to be that type of player a team can take that risk.
Many other teams have major decisions to make.
Players like Wandy Rodriguez of the Astros, Dallas Braden and Trevor Cahill of the A's, and Jair Jurrjens of the Braves need to be looked at longer term at below future-market rates.
But the biggest task might fall to the Cincinnati Reds have to decide if Joey Votto (yes, of course!), Edinson Volquez and Johnny Cueto need to be locked up soon. They all are coming up on their arbitration years.
This would be a great move for the first-place Reds to sign all three, who have plenty of young players in the fold who could keep the Reds at the top of the NL Central standing for many years to come. Similar to what their in-state brethren, the Cleveland Indians, did almost 20 years ago.
Most of the big market teams seem to like to get their players just before or a year after their first year of arbitration.
I feel it might be better for the smaller-market teams to take a bigger risk by signing top guys earlier, like Longoria in Tampa and Troy Tulowitzki (his college teammate) in Colorado. The Rockies would be wise to lock up Carlos Gonzalez to a "Longoria type" deal this off season and keep the young slugger locked up in Colorado through age 30.
It sure worked for the Rays.
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