Late addition: After talking about this with a few people, thinking about it some more, and reading the comments, it strikes me that perhaps Rosenthal misheard or misinterpreted the information. Even using the high-end signing figures the Yanks are just barely over that 5 percent threshold. Given the significant penalty for going even that fraction over, I find it hard to believe that they made such an error. Mistakes are made, of course, and it’s possible, but at this point I’m more apt to believe that they are still within the zero to 5 tier, and thus accrue only a tax on the overage rather than a restriction on players they can sign in the upcoming international signing period.
Furthermore, Rosenthal states that the “Cubs and Rangers went over the limit in 2012-13,” when in fact the Cubs and the Rangers are both over their limit in the current signing period, which is 2013-2014 (seeing as it started July 2, 2013 and extends into 2014). From what I’ve read, the Rays were the only team to exceed their international pool allotment in 2012-2013.
It would appear, then, that the Yankees’ plans to spend big in the international market concern this coming year’s class, which will open for business on July 2, 2014. The Yankees will have a larger pool of money this year, since they finished lower, but that won’t change the equation too much; last year, as the No. 28 team, they got less than $200K less than the No. 18 team. But the new period does give them a fresh crop of talent, and if they don’t care about the penalties they can spend as much as they’d like. Given the facts and the implications, this seems far, far more likely than them spending further money during the current period.
Original. One signature element of the current CBA is the restriction placed on almost all forms of amateur player acquisition. In both the Rule 4 draft and the international signing period, teams have limited pools of money at their disposals. Exceeding those limits incurs penalties that affect teams the following year, thereby discouraging lavish spending in any single draft or signing period. There’s even talk of an international draft, which would further limit teams in acquiring talent.*
*Really, it’s just one more way MLB strives for boring parity, rewarding bad teams with enormous talent opportunities, both in available dollars and preferred selection. But I digress.
Teams can create advantages for themselves, given the right circumstances and conditions. For example, if a team feels the current international class is strong and the next is weak, it can splurge before facing the heavy restrictions the following signing period. It appears the Yankees will take that path this year. They’ve already exceeded their $1.8 million international cap, signing CF Leonardo Molina for $1.4 million and SS Yonarius Rodriguez for $575,000. According to a recent bit by Ken Rosenthal, they’re not quite done yet.
According to Rosenthal, the Yankees are just 3.8 percent over their capped limit, but he also has the Rodriguez signing at $550,000. MLB Trade Rumors, which has the Rodriguez bonus at $575,000, notes that figure puts the Yankees more than 5 percent over the cap, therefore already inducing penalties. In that case they won’t be able to sign any player for more than $500,000 during the next signing period, which, given the two bonuses given to their signings this year, is a major impediment. The same penalty, with a greater tax on overages, is in place for the 10 to 15 percent bracket. That essentially means that as long as they can stomach the 100 percent tax on overages, there is no reason to sit at 5.1 percent over the cap. You might as well go all the way to 14.9 percent. Spending that exceeds 15 percent over pool dollars limits a team to $250,000 on a single player during the next signing period.
The question is of how the Yankees are going to spend this money. All of Baseball America’s Top 30 international prospects have signed. There could be a number of players with whom they have experience and who might have flown under BA’s radar. Even in that case, the Yankees don’t have a whole lot of bonus money within that 15 percent threshold; just under $200,000, to be exact. So in order to make an impact, they might have to go over 15 percent and further limit themselves for the upcoming signing period.
Or it could all be hooey. Rosenthal cites “rival international scouts,” and rival scouts have agendas. At the same time, if the Yankees are in fact over the 5 percent penalty, they might as well go hog wild. The rules make very little distinction between a 5.1 percent and a 14.9 percent overage.