Feb
20

The Yankees’ 2012 Draft Pool: $4,192,200

By

Via Jim Callis, the Yankees will have just $4,192,200 to spend on the first ten rounds of the draft (eleven picks) this year thanks to the new Collective Bargaining Agreement. That number will go down ever so slightly if Derrek Lee manages to sign a big league contract. The Twins lead the way with a $12,368,200 draft pool while the Angels only have $1,645,700. Ouch.

Teams that exceed their draft pool by no more than 5% are taxed at 75%, and after the 5% they start forfeiting future picks in addition to the tax. Picks from the 11th-40th rounds each have a $100k soft cap, and any money exceeding $100k for those late picks counts against the draft pool. If a team fails to sign a player in the first ten rounds, they lose that spot’s pool money. They don’t get to reallocate it elsewhere. The Yankees have spent between $6.1M and $8.0M on the draft in each of the last five years, and last year they spent $4,202,500 on the first ten rounds (ten picks).

Categories : Asides, Draft
  • Paul VuvuZuvella

    I vote for Capitalism and the Free Market system. This blows.

    • LaserVortex

      It doesn’t not blow if that’s what you mean.

      • Paul VuvuZuvella

        I don’t believe you are wrong.

    • chris ginn

      if a team runs out of funds to sign a player but the drafted player wants to turn pro, would the player be allowed to opt to be a FA? and then be allowed to sign with any team for any amount?

      • joe

        This was my question, seems like it could be an issue dowj the line

    • Plank

      So you want to get rid of the draft, too?

  • pat

    Seems like they’ve been preparing for this for the past two years. Also, where do these numbers come from?

    • pat

      Ah, never mind. Callis explains. Missed the link the first time though.

  • Johnny O

    Wow, i guess i didn’t pay enough attention to the new CBA. This is INSANE. Baseball is basically ruining its own talent pool. The mid-round multi-sport athletes will all forgo signing for only $100k.

    I have no idea why this new system makes sense. The draft spending was by no means a major issues for anyone, and is a very small fraction of the overall costs of MLB teams. Lots of times the small/mid-market teams outspend the Yanks and the like. And the difference between spending $5M and $7M on the draft is much less than the difference between the Yanks $200m payroll and the Rays $40M payroll.

    • Jimmy McNulty

      Basically. I hate this, I hope they fix it before the new CBA expires…this is awful.

  • This Year

    Sign Soler before all this happens. If they do not, they are stupid, having passed on others. As someone else said, treat Soler like a good bottle of scotch on the eve of Prohibition.

    • Chip

      Soler would come out of a different stack of money though right? I believe this is just for the Rule IV draft whereas international signees have a different limit

      Still, it really does suck

  • STONE COLD Austin Romine

    Good one.

    But to be honest I’m more bothered by the IFA spending limits than I am by the draft rules.

    • Mike Myers

      Im not.

      This hard slot system makes it as equal as possible for teams drafting.

      The IFA makes it more equal, however a team with deep scouting like the yankees can start signing an abundance of players at a younger age instead of going for the big ticket items.

      At the end of the day, drafting is an educated crap shoot. spending less on drafts give the yanks more money to spend on FA. They still have the advantage….I think.

      • Tom

        The IFA market is driven by infrastructure, and the Yankees have this. Yes there are big money guys who get 1+mil (Chapman, Igleseias, Montero), but the vast majority of guys are five or six figure deals and usually come about through connections, academies, and good scouting. Banuelos/Aceves/2 others came over from the Mexican league for what? I think it was a 450K package deal.

        If teams are fighting each other on 100K deals, the team and brand come into play and I think that is to the Yankees advantage.

        The other thing is there really is no IFA cap. If the Yankees see a unique player they can blow away the “cap” and pay the 1:1 tax on it. At that point the only impact the following year is the max they can offer to any one player, not the amount they can spend…. so you could also see a binge/purge strategy (sign big name player, next year sign <250K players, sign big name player….)

  • CJ

    I don’t understand this. Why are the Angels so low? Does this give Minnesota enough of a competitive incentive to actually spend the $12.3 m? The range is too great to make sense

    • pat

      Angels lost their first two picks for signing Wilson and Pujols. They lose the money allotted for those two picks as well.

  • Jerkface

    They’ve reduced the draft spending by 20% if no teams go over the limit. Really dumb. Let the kids get paid what they are worth.

    • Chris

      Like Andrew Brackman. Dude couldn’t throw the ball in the ocean. If they want to get paid, let’s see results in the minors and in MLB. I kind of like it, but at the same time, players are more likely to go/stay in college.

      • Spiff

        And/or play other sports. In the long term, this could hurt baseball’s talent pool.

      • Jimmy McNulty

        Yes that last part is what kills you. Imagine if Matt Moore went to college? The Rays don’t get him, and whoever drafts him pays a hefty price. You have to take risks in the draft in order to get good players, it’s the way the game works. Every team can afford 10M on the draft, and that gives you a perfectly robust draft. I’d say most teams out of the top 20 probably can’t justify 10M on the players that they draft, but still…every team in the majors can afford to spend big on the draft. But, because the White Sox, Mets, and As don’t want to spend money the good ones can’t.

        Signability guys go both ways, some boom, but most bust…teams know this going into the deal.

        • CP

          The bigger issue is not a guy like Matt Moore boosting his stock, but someone that decides to go to college to play football or basketball instead of baseball. Would Austin Jackson be in the majors today if these rules existed a few years ago?

          • Jimmy McNulty

            Probably not, probably wouldn’t even be in baseball. He was a basketball/baseball recruit, IIRC. Joe Mauer was a recruit to play QB at FSU, and there’s another FSU recruit that’s supposed to play QB but might get drafted early this year…forget his name. He may decide that if he can’t get a huge bonus he’ll like like a king at FSU playing QB. Life as a minor leaguer sucks, and if a kid legitimately thinks he can make the NFL it may be more advisable to tell him to go to school than to play baseball now.

  • STONE COLD Austin Romine

    Cubs royals yankees reds and blue jays all spent over 2 million after the first 10 rounds last year with the Cubs spending the most after round 10 (5 million plus)

  • Rookie

    It’s a way to block the back door and lock the windows.

    Given the 50% luxury tax and other financial incentives to keep the payrolls down, it would be logical for them to pay whatever it takes in the draft and on IFA. This is a way to block that option and ensure that they get the competitiveness and mediocrity of teams that we all love so much in the NFL.

    Like Karl Marx said, and like our President and his party seem to agree, “From each according to his abilities, to each according to his needs.”

    What will they do next? Have the worst teams pick a player from the roster of the best team each year? Oh, wait. I guess that’s the Rule 5 draft.

    Don’t worry, though. It’s going to get better. Our children are being taught that there are no winners and losers. So when they’re running the show, maybe pro teams won’t keep score — and we’ll give every team a championship trophy at the end of the year and every player an MVP, Silver Slugger, Cy Young or other award (for their self esteem and the self esteem of their fans, you know).

    And since they’re not being allowed to play dodge ball in school since it’s too dangerous, maybe they’ll have gotten rid of the hard leather-covered baseball and be using a nerf ball.

    • Jimmy McNulty

      Well after seeing such a stupid critique of the new CBA I’m pretty sure I’m in favor of it.

    • Genghis

      This is an anti-Boras move. If an agent tries to hold up a team for a big-time prospect, any contract excesses are going to come out of what other prospects can get. It’s no longer agent vs. team, it’s agent vs. agent and prospect vs. prospect.

      That’s why they did it.

      • Jimmy McNulty

        Great! They’ve changed the way adversarial negotiations work in sports.

        • Genghis

          True. But if you think about it the way I just suggested, it’s kind of clever. Luckily for MLB, the Player’s Union doesn’t care much about amateur free agents; otherwise, MLB wouldn’t have been able to get away with this. It is possible to invent a similar scheme for pro free agents, but the Union wouldn’t stand for such a thing.

          • Rookie

            You nailed it, Genghis. They’re throwing the amateurs under the bus.

            But once they figure out how much it’s biting them down the road, I suspect it gets changed to be less harsh (at least on payrolls) in a future deal.

            • Genghis

              Maybe. I don’t see this as such a major hit to baseball talent overall in the long run. They may lose a small number of dual-sport players every year. Quite a few others will go to college rather than signing out of high school, but the good ones will end up in the draft again eventually.

              • Havok9120

                “Eventually” hurts the talent pool too. The quicker these guys, especially pitchers, get to professional-caliber coaching, the better. The longer these guys stay dual-specialized, using metal bats, and generally mucking around the harder it is to turn them into viable major leaguers. Not to mention that you have 2 or 4 fewer years to do it in.

                I actually do think that this will hurt the talent pool a bit more than you, but I’m just as concerned about those guys that will go to college and need to unlearn 4 years of amateur-ish coaching.

    • JohnnyC

      Fun Fact: Bud Selig went to school with Saul Linsky.

      • Rookie

        That would certainly explain a lot.

        I think much of the rest of Selig’s behavior is explained by the fact that the Yankees kicked sand in his face when his family owned the Milwaukee Brewers.

      • TomG

        Best post of 2012.

    • Voice of Reason

      If not satire, that post was nonsense.

      And also, these changes to the draft and eventually IFA are decidedly to the disadvantage of small market teams. The return on investment is far better with draft picks and IFAs than it with with MLB free agents, and now it’s harder for small market teams to take advantage of that inefficiency.

      • Rookie

        I couldn’t disagree more.

      • http://yankeeanalysts.com Matt Imbrogno

        The changes are to the detriment of every team, big or small spending.

  • dennis

    I think when this was first announced we found a loophole in the IFA where u can overspend one year and then cant spend anything the next year. So if the Yanks REALLY like a player they can go over budget

  • Ed

    There’s no spending limit after the 10th round, right? Will we see Boras clients and two sport players refuse to negotiate unless they’re picked in the 11th round?

    • pat

      Money over 100k per pick after 10 goes against the cap.

      • Ed

        Thanks, I hadn’t heard of that rule before.

  • Jimmy McNulty

    Well this kills my interest in the draft and IFA signing period. Definitely cost BA a subscriber.

    • Rookie

      Like I said…

      On the other hand, the NFL has enjoyed tremendous success. So maybe it’ll work just fine.

      But again, I don’t like it either. It seems to be a formula for mediocrity for all.

      • Delaware – Ralph

        Except that the NFL didn’t have a system like this where you could lose a draft pick or be taxed if you signed your draft picks for too much money. It just worked against you with you cap. (ie Andrew Luck lost about 15-20 million by going back to school last year thanks to the new CBA)

        • Rookie

          Thanks, Delaware – Ralph,

          I don’t follow the NFL closely. I just hate a hard cap or anything that has a similar effect.

          But now that I know that apparently Chairman Bud has taken it even further along the road to mediocrity, I like the CBA even less.

          We’ll see how the small market teams like it when the big, bad teams aren’t doing well and their big market fans have tuned out and the ratings and TV revenues reflect that.

      • Bryan

        Cannot compare the NFL and MLB. The standard of NCAA football is higher than baseball, such that its gap with the NFL is less than NCAA baseball is with the MLB. That’s why we have the minor leagues in the first place, to fill the developmental gap that the NCAA cannot. The standard of play won’t suffer because talented amateur baseball players will still choose to play baseball. And the two-way players will ultimately choose the sport they’re mostlikely to succeed in. The bonuses will be smaller, but players will rather take small odds of making the Show, than zero odds of playing in the NFL or NBA.

        It won’t be a formula for mediocrity. It’ll just make success in the MLB more cyclical, where efficiently run teams will be rewarded. Even big market teams willing to continuously spend in free agency won’t be able to completely fight off the down cycle. Look at the Patriots, Ravens, Steelers. They’ve been competitive for a decade or so. But once their key players retire, they’ll get back into the cycle, and be rewarded if they scout, draft and develop efficiently.

  • Cy Pineda

    Callis: (from 11/29/11)
    •The most significant new detail: If a team fails to sign a player in the first 10 rounds, its draft cap is reduced by the assigned value of his pick. It can’t reallocate that value to sign other players. However, it can reallocate the difference between a player’s bonus and the value of his choice.

    Would it benefit the Yankees to sign a couple of college scrubs in rounds 4 & 5 ??? offer tiny bonuses, then take that difference in value to offer a prime player more money?

    • 28 this year

      But isn’t the tax not just based on the overall pool money but the specific pick’s pool money. LIke a first round pick might have a pool of 1 million you can’t exceed. So like you can’t spend 4 million on one pick adn go cheap the other nine. Each pick is taxed I think

      • Needed Pitching

        no, its based on the total pool
        the Yankees could spend 4M on one player and not be taxed if they could somehow get their other ten picks to sign for a combined 192,200

        • I am not the droids you’re looking for…

          Lulz. I’m sure they could find 10 guys (like any ten of us for example) who’d sign for $19k each for the 15 seconds of fame and a day in spring training :)

    • Genghis

      Only if they can foresee the future. The new system is going to encourage players in rounds 1 to 3 to take the very high “standard” bonuses. The value of having “excess” money per your scheme would be to sign a later round guy who would otherwise have gone to college– a typical Yankees move. However, this doesn’t work unless you know you are going to draft such a player in the later rounds.

    • Tom

      I was thinking this as well…

      The problem is I imagine the slot money tapers off so quickly that bargain basement shopping in rounds 5-10 may not generate that much extra money to go “overslot” on a round 1-3 type pick.

      When you look at the rather massive deltas between teams you can also see how large a slope even just the first round slots have.

      The other problem is this sort of strategy would need to be “leaked” out in advance, such that a draftee can say to teams with an earlier pick that he has a high bonus demand so don’t bother signing him (so they can fall to the Yankees or whatever teams employs this type of strategy)

  • pollo

    This draft cap is fucking idiotic. why the hell would the yankees ever accept this bullshit.

    • Rookie

      The Yankees don’t make the rules. There are more teams that want to control the Yankees and other big market teams that spend or hope to spend anywhere near the luxury tax threshold than teams with relatively limited budgets who don’t expect to ever go near it.

      It’s why our Founding Fathers wanted a republic and not a democracy — because they knew that, sooner or later, all democracies fail when their citizens realize they can vote to confiscate the resources of others.

      And the fact that Selig with his small-market background is steering the ship.

      Like I’ve said, I think it’s a formula for mediocrity. But I gather that something akin to it (in principle, at least) is working just fine in the NFL. So maybe it’s a great idea. What do I know?

      • Bo Knows

        Small market teams (there fans at least) hate it too because it makes them less likely to be able to spend on high quality talent as well. Basically this CBA screws everyone hard

  • JobaWockeeZ

    These rules ares horrendous. But then again looking at our drafts I can care less.

  • Mike HC

    Sounds like a lot of lawyers are going to be making a lot of money trying to figure out the ins and outs of all this new collective bargaining stuff. I imagine there are more loopholes than we can imagine at this point if you look hard enough.

    All these new rules seem worse than the previous cockamamie rules MLB had. The idea of “less is more” really has escaped baseball.

  • RetroRob

    Why do the Yankees have $4 million and the Angels only have 1.6 million?? I’m guessing it’s because Pujols and Wilson are A’s.

  • Preston

    This new CBA will have huge unintended consequences. Elite high school talent will play other sports. More high school players will play college baseball which will take a lot of the player development out of the hands of MLB teams. Not to mention teams will utilize differnt strategies to circumvent the rules. I think a lot of teams will draft players with no intention of signing them to save the money. College seniors will not get any kind of bonus. They have no leverage. Why would you pay a guy more than 100k, is he really going to turn it down to go play in an independent league for a year and go back into the draft, doubtful. I’m sure there will be 100 other things that happen that nobody now can think of.

    • I am not the droids you’re looking for…

      I’ve been thinking about these unintended consequences quite a bit. Just to play devil’s advocate for one of the ones you list…might not some athletes forego college instead, figuring that unless they shoot waaaaaay to the top of the draft, they’re not likely to get (much) more money than if they enter as HS grads?

  • RetroRob

    So the Yankees have the same amount of money to spend this year as last year? One thing that seems clear is the Yankees were operating with a pretty set draft budget, so perhaps they’ve been preparing for this.

    Sounds okay on paper, although their two most recent draft strategies seemed to have been based on the idea that higher end talent will drift lower based on signability/committment issues. So they went with high upside, but easier signs like Bichette, pushing more of their budget to the future rounds. With the new rules, those players with signability issues simply won’t be drafted, or if they were playing a game knowing they could get more money, they will now instead be drafted and signed earlier by teams who have more money to spend. That means the Yankees won’t find these players lower in the draft.

    I still insist this upcoming June draft promises to deliver a lot of surprises as both teams and agents try to figure out a new dance.

  • http://fendersonandhampton.com Cuso

    Nobody has asked this and I guess I am missing the significance.

    What the heck does Derrek Lee have to do with anything?

    • http://www.riveraveblues.com Mike Axisa

      The Pirates get a pick comp pick if he signs a MLB deal somewhere, and that will push every Yankees pick after the first round back one spot, which will drop their pool number a bit. The lower the pick, the lower the money associated with it.

      • http://fendersonandhampton.com Cuso

        10-4.

        Thanks.

  • Krull

    What’s the advantage of this system over MLB just specifying an exact salary/bonus that can be given for each pick? Why make it so much more complicated for so little financial maneuvering room?

  • Plank

    The Yankees can spend 5% more than their number without losing picks, just getting taxed. So the number they are really working with is 4192200 plus 5%.

    That extra $200 is gonna be the difference between success and failure for years to come.