Breaking down the payroll, part threeBy
It’s been less than a month since we last checked on in the Yankees’ projected 2012 payroll, but a lot has changed. Just about all of it in the last week or two as well. The Michael Pineda/Jesus Montero trade didn’t change anything financially (at least not significantly) since they’re both in their pre-arbitration years, but the Hiroki Kuroda signing and arbitration settlements sure did. Andruw Jones agreed to come back, Cory Wade inked a new deal … and that’s pretty much it. Here are the gory details…
- Guaranteed Contracts (16 players, $183.125M): Alex Rodriguez ($27.5M), Mark Teixeira ($22.5M), CC Sabathia ($24.4M), Derek Jeter ($17M), A.J. Burnett ($16.5M), Mariano Rivera ($15M), Robinson Cano ($14M), Rafael Soriano ($11M), Nick Swisher ($10.25M), Curtis Granderson ($10M), Pedro Feliciano ($4M), Freddy Garcia ($4M), Phil Hughes ($3.2M), Joba Chamberlain ($1.675M), David Robertson ($1.6M), Wade ($500k)
- Contracts Pending Physicals (two players, $12M): Kuroda ($10M), Jones ($2M)
- Unsigned Arbitration-Eligibles (three players, $13.5M max/$11.1M min): Russell Martin (filed for $8.2M, Yanks for $7M), Brett Gardner ($3.2M/$2.4M), Boone Logan ($2.1M/$1.7M)
- Option Buy-Outs (one player, $0.250M): Damaso Marte ($0.250M)
The money listed is in terms of average annual value, which is what the luxury tax is based on. The players’ actual salaries are slightly different in some cased, but nothing crazy.
So that’s all of it, 22 players owed a maximum of $208.875M and a minimum of $206.475M. One of those 22 is not on the team anymore, and for simplicity’s sake, let’s assume Martin, Gardner, and Logan each win their arbitration cases. That gives us 21 active players and a $208.875M payroll, though Feliciano is only active in the sense that he’s taking a spot on the 40-man roster. It’s really 20 active players for that price.
The Yankees have been talking about spending just $2M or so on a DH, but I think that’s their way of trying to drive Johnny Damon‘s down more than anything. I expect them to end up spending about $4-5M on the DH, but anything more would surprise me. If they sign a DH for $5M and fill the remaining four roster spots with guys making the league minimum, the 25-man payroll would be approximately $215.875M, up a couple million up from the $212.7M that was luxury taxed in 2011. We haven’t even included the rest of the 40-man roster or stuff like player benefits (which gets taxed as well) yet either.
The other 15 players on the 40-man roster will make the league minimum, though let’s call it 16 players since Feliciano will be stashed on the 60-day DL so another player can be added at some point. Calling it $8M for those players is conservative ($500k each), since they’ll make a substantially smaller salary while in the minors. The $8M is probably closer to $3M in reality, if that. Player benefits are taxed and typically estimated at $10M, which brings us to $233.875M, conservatively. Just imagine if they add a player or two at the trade deadline.
None of us are privy to the Yankees’ financial info, but chances are they can support a payroll much higher than the $200M or so they’ve been spending in recent years. We can’t say that for sure, but it’s a reasonable assumption. I do however think the commissioner’s office and players union have discouraging them from raising payroll any further, just like they’ve encouraged small market teams (the Marlins and Athletics, specifically) to spend more in recent years. Raising the payscale for many second and third tier players over a handful of superstars is probably a net win for the union.
Anyway, that’s my one-paragraph semi-conspiracy payroll theory. As Stephen will explain later today, the club is going to have to make several tough decisions if they’re serious about getting under the $189M luxury tax threshold two years from now, but for now we don’t have to worry about that. The Yankees will again spend an absurd amount of money of their 40-man roster in 2012, far more than any other team.