Apr
28

Passan: Yankees appear unlikely to follow through on 2014 payroll plan

By

Via Jeff Passan: The Yankees appear increasingly unlikely to follow through on their plan to get under the $189M luxury tax limit by 2014 and beyond. They’ve been telling other executives and agents the plan is “unlikely and impractical,” with one team official saying it “was a good idea to try, but deep down, we all pretty much knew it wasn’t going to happen.”

First things first, Passan’s article appears to be speculation and he said, she said based more than anything. Wally Matthews had a similar report back in February, so this isn’t the first time we’ve heard the 2014 payroll plan may be going by the wayside. That said, where there’s smoke there’s fire. Passan explains the expected savings are not as great as anticipated and that’s as good a reason to scrap the plan as any. I want to see how the team approaches next offseason before I fully believe these reports, however.

Categories : Asides

38 Comments»

  1. RobA says:

    Tbats all good and fine but free agency is more or less dead now. Not too many impact guys on the market this coming offseason. It will still be good for supporting players, but were not going to see too many Sabathias or Texieras in FA anymore.

    • lightSABR says:

      Though we will be seeing a Cano and a Granderson quite soon…

    • Doc says:

      Doc says to Randy Levine: “This is it! This is the answer. It says here that a bolt of lightning is going to strike the clock tower at precisely 10:04 p.m. next Saturday night! If… If we could somehow harness this lightning… channel it into the flux capacitor… it just might work. Next Saturday night, we’re sending you back to the future! NOW LETS SIGN JUSTIN UPTON YOU MORON!”

  2. jjyank says:

    Yeah, this has already been discussed a bit in a few previous comment sections. Seems like a few vague sources that may not even mean anything with Passan’s owns speculations in between. I’ll believe it when I see it.

    That said, I hope it’s true. I never trashed the team for trying to get under budget because I understood the logic, but that doesn’t mean I wanted them to spend less money. Of course not. I don’t want them to go spend like drunken sailers if they scrap the plan either, but it would be nice if they didn’t have such a finite amount of wiggle room.

    • hogsmog says:

      The thing I heard which really pushed me into the decidedly anti-189 plan was something like ‘For a team with over a billion dollars in net worth, saving a few tens of million is nothing but a show’.

    • lightSABR says:

      I think the reason to take it seriously is that if it’s not true, there’s absolutely no strategic reason for the front office to spread the rumor. The team is better off in negotiations if people think it’s trying to get under $189m–actually trying to get under $189m when no one believes you’re trying to do so is pretty much the worst possible bargaining position.

      That said, it’s always possible that these are leaks the front office didn’t approve of and can’t control, in which case maybe what we’re seeing is employees trying to force Hal’s hand by putting him in a position where the team’s PR and negotiating position make it increasingly costly to stick to the plan. Will it work? Who knows. Hal’s the type that should be running a private equity fund, not a baseball team. But if people are trying to force his hand, I sure hope it will work, because it hurts the team otherwise.

      • Havok9120 says:

        There’s yet to be any serious indication that “the front office” is spreading the rumor. The only two report we’ve heard about this have been from notoriously inaccurate reporters quoting very, very vague sources.

  3. Chuck M says:

    I think that rob is right – the biggest issue with the fan base and the top level management (Levine) is that free agency is different now than when George was running things. I mean, really – what were the Yanks going to do (besides the Fransisco and Ichiro things going so, so wrong on them) to significantly improve this team this year? The top level free agents were signed to awful contracts – I mean, did you really want Hamilton for that long? It’s going to be tricky enough managing the sharp declines of Teix, A-Rod, and Jeter, and it’ll be interesting to see what happens with Cano – no need for another A-Rod contract, please.

    • Tyler says:

      Right. I think people tend to overlook the fact that just because the Yankees have money does not mean they should spend it. Like you said, what big-money FA from last offseason was really worth all the money? And look at this upcoming class, which is pretty barren of impact talent. SHould the Yankees just go out and buy both Ellsbury and Choo and whoever else because the payroll can maybe be $230 million next year?

      • I'm not the droids you're looking for... says:

        Swisher will likely prove more or less worth the money when all is said and done. But I get your point.

      • Havok9120 says:

        Swish would have been worth it without the 189 plan in place. With it there, he didn’t fit the budget.

        Other that that, there was no one else really calling out to me. I would have signed Martin, but that’s it.

  4. CountryClub says:

    Hal has publicly stated that this is his goal…and not just because of the reported benefits. He was just on with Francessa a few weeks ago and reiterated that 189 is his desire.

    So we’ll see how this plays out. I was never up in arms about it to begin with, but if they want to scrap the plan it’s fine by me.

    • Robinson Tilapia says:

      That can mean a lot of different things, though. It may mean that, while its his desire to add a bit of financial prudence to things, it may be better for it to be a work in progress rather than a quick removal of the Band-Aid because of the multiple long-term deals on the books, especially Alex’s. If the savings aren’t what they thought they would be, I see how it could lead to a change in thinking.

      This is all tea leaf reading, of course, including whatever speculation Passab and Matthews want to pass off as their own analysis.

      • CountryClub says:

        Yeah he repeated the company line that 189 is the goal but only if the team is still champ level.

        But he said that he doesn’t believe you have to spend 200+ to win the WS.

        Obviously he’s right about that. But I agree with you that hopefully they’ll use a long term vision in getting to whatever number he finds acceptable.

  5. Andy says:

    I think the 189 should be a 5 year goal. To keep the team competitive over the next few year, it’s a unrealistic target given the contracts to arod tex cc etc. The days of the Yankees and Red Sox controlling the free agent market are over, because of the revenue sharing and tv deals. The other teams have had the top draft picks for years ( eg Rays and Nationals) and we are now seeing the results of that. Free agency now can only be used to supplement a team around a core of young drafted players. Far too expensive to build a whole team with free agents! The Yankees have been over paying for players for years to stay at the top, with very few stars coming through the farm system since the core 4. I think the Yankees will have to re sign Curtis as the alternatives are a big step down. And if Andy and Hiroki don’t return that leaves a big hole in the pitching staff to fill out, not to mention a certain closer retiring! That’s gonna cost a lot of $.

    Hopefully these players we keep getting off the scrap heap added to main guys can keep getting it done till the farm system produces the next batch of stars.

    • mitch says:

      “I think the 189 should be a 5 year goal.”

      That’s what i’ve been saying for a while. Crow-barring the payroll under 189 in one off season is an accounting trick. They should just focus on smarter spending and let the payroll come down naturally. That would seem to be a much more maintainable strategy to save money long term without hurting the product in the short term.

    • MannyGeee says:

      “I think the 189 should be a 5 year goal…”

      Truer words never spoken. There is A very slim chance that this team the way they’re constructed today would get to 189, let alone doing it and staying at a championship caliber… So knowing this, you work towards the things you can control (walking away from a Josh Hamilton type signing) while dealing with the issues that already exist (the man they call A Rod). In the mean time you make tough decisions (letting Granderson walk?) while being responsible with other obvious needs (not giving Cano keys to the castle, but don’t do something that will make him walk away…)

      I would say making $189-ish by 2016-7 is much more realistic.

  6. Greg says:

    one of the reasons for this new spin is attendance. Need to keep putting people in the seats to watch this uninteresting, non-star team. Don’t want people to think this is what it’s going to look like long term.

    • Robinson Tilapia says:

      Have you actually looked at figures yet, or are you just looking at the TV going “look! Empty seat!” There’s a difference.

      • JonS says:

        They have averaged 75% capacity with around 37,000 seats sold. From watching on TV, I’d bet a lot of those seats that are unsold are the higher margin ones as well.

        Link for stats.

        http://espn.go.com/mlb/attendance

      • Sandlot Beans says:

        I bet you still think the Red Sox sellout streak just ended to. Reported numbers are always higher than real numbers. If you think only what tickets sell matter, then ask Legends Hospitality about that. I’m sure Hal cares about that since he owns that too.

        • Havok9120 says:

          Guess what. The number of tickets that sell outside team control IS all that matters. Whether the seat is filled during the game only matters to the YES producer that doesn’t want the stadium to look empty. The money is made either way.

    • Get Phelps Up says:

      Based on attendance figures, more folks are watching the “uninteresting, non-star Yankees” than the Tigers, Reds, Braves, or Nationals.

  7. BoKnows says:

    Axisa… another “blogger’s” unsourced twitter account does not count as a source. Obviously I did not say “journalist’s” becuase… duh.

  8. Need Pitching & Hitting (but mostly hitting) says:

    I don’t think they’ll ultimately end up sticking to $189M for 2014, but I’m not convinced they have made that final decision yet. The structure of the Wells trade was a pretty strong indication they were still strongly considering sticking to the plan as recently as late spring training. I’m not sure what would have changed in the meantime to cause them to suddenly completely abandon the plan. I suppose Jeter’s setback and Nova’s continued struggles might make them more likely to see building a credible, championship caliber team for $189M next year as a pipe dream, but I doubt they’d come to long term conclusions on either player this early in the season.
    Or I suppose the lackluster attendance and fan backlash may have made them rethink the wisdom of the current path.

  9. qwerty says:

    You cannot field a competitive baseball team for less than 230 million (current payroll), it’s impossible!!!!! :)

  10. mustang says:

    Big fucking surprise.

    “You can’t run a $3 billion team with the intentions of saving a few million dollars.”

    Just change the word “team” to business.

    EVERYTHING runs of the success or effort to succeed of the Yankees team on the field. When they shortchange that it’s only becomes a matter of time before the entire business suffers. I think Hal is smart enough to understand this and know his father did.

  11. Improbable Island's Dirty Midget Whores (formerly RRR) says:

    I don’t buy it until I hear Hal say it.

    • Havok9120 says:

      Then you’ll never buy it. Even if the entire thing has been a ruse from the start there’s nothing to gain by Hal admitting it.

  12. RetroRob says:

    I think he will turn out to be correct, and I was originally one of the people who believed the Yankees were going to attempt to get under 189 simply because Hal claims to be a financial geek. It’s for that reason that I think they will now ditch it. There are two sides to finance: cost and revenue. The cost savings aren’t what was originally promised, and revenue will go down because the product is less exciting. That means a change of direction. If it only took them one season to figure that out, all well and fine.

  13. FEED.ME.MORE! says:

    I think the plan is admirable, and is something to defintely shoot for. But if the cost savings isn’t really worth it, then scrapping the plan isn’t the worst thing.

    Maybe they should cut the cost of some tickets and parking, to at least get more people in the park. I mean, they are a winning team. So the lowered attendance seems to be the product of two causes:

    1) Ticket prices
    2) Spoiled fandom. The “Shiny new toy” syndrome has taken over the fanbase.

  14. Jonathan says:

    https://www.youtube.com/watch?v=yMQhXc1dHIQ

    Probably would have helped to keep Swisher over Ichiro and be able to take on money in a trade last offseason…Maybe have a MLB catcher too and a bench.

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