Getting under the luxury tax threshold in 2017 is possible, but very unlikely for the Yankees

(Jim McIsaac/Getty)
(Jim McIsaac/Getty)

At some point soon very soon the Yankees will get under the luxury tax threshold. That’s the plan. The new Collective Bargaining Agreement raised the threshold a bit, which gives the team more breathing room. Getting under the threshold resets New York’s tax rate, and depending on the terms of the new CBA, it could entitle them to some revenue sharing rebates too. Those were included in the last CBA.

The Yankees shed some notable contracts following 2016, most notably Mark Teixeira‘s. Carlos Beltran‘s contract disappeared at the trade deadline, as did Andrew Miller‘s. Miller is signed for another two years. Beltran was an impending free agent who would have come off the books anyway. The recent Brian McCann trade freed up some cash too, and next year CC Sabathia and Alex Rodriguez will be gone as well.

Because the luxury tax threshold is such an important number now, let’s look over the Yankees’ current payroll situation to see exactly how far away they are from the $195M threshold in 2017. Is there a chance they could get under as soon as next season? Sure, it’s possible, I guess. The numbers suggest it’s very unlikely, however. Let’s break it all down.

Guaranteed Contracts

Keep in mind the luxury tax payroll and actual payroll are different things. The actual payroll is what the Yankees truly owes these guys. The luxury tax payroll is based on the average annual value of contracts, which can be different than the player’s actual salary in any given year. Teams can’t manipulate the luxury tax payroll by front or back-loading contracts. Here are the luxury tax “hits” the Yankees have the books at the moment.

That all works out to $139.57M against the luxury tax payroll for only nine players. Gardner and Headley have been mentioned in trade rumors this winter — interest in the two is said to be “relatively mild at the moment,” though something could always come together quick — and trading either guy would clear up some cash, even if the Yankees eat money to facilitate a trade, as they did with McCann and Beltran.

So anyway, since Gardner and Headley are still on the roster, we have to count them against next year’s projected payroll. We’re at $139.57M for nine players. There is still more than 75% of the 40-man roster left to be filled, and the Yankees are already less than $56M away from the $195M luxury tax threshold for 2017.

Arbitration Projections

Right now, the only salary figures we have for arbitration-eligible players are projections. Those guys usually don’t starting signing contracts until after the holidays. Matt Swartz at MLBTR has a really great projection model, but it’s not 100% accurate, so there is some wiggle room here. Here’s what Swartz’s model spit out for the seven arbitration-eligible Yankees.

I really do think Swartz’s model is selling Betances short. Saves pay through arbitration and he doesn’t have many of them, but he’s been so insanely good at everything else these last three years that I think he’ll get paid like a closer in arbitration. Perhaps something closer to $4M, which is what guys like Cody Allen and Jeurys Familia and Hector Rondon received in their first trip through arbitration last year, could be in the cards.

Let’s stick with Swartz’s projection for Betances though. The seven arbitration-eligible players come in at $22.1M, and since these are all one-year contracts, we don’t have to worry about any fancy average annual value math. Between guaranteed contracts and arbitration-eligible players, we’re at $161.67M for 16 roster spots. Roughly $33M away from the threshold with 24 40-man roster spots to go.

Miscellany

The guaranteed contracts and arbitration-eligible players are easy. Now we’re getting into all the other smaller expenses that count against the luxury tax payroll, which always seem to cost more than people may realize. Here are the team’s miscellaneous expenditures for next season:

  • Dead Money ($33M): Alex Rodriguez ($27.5M) and Brian McCann ($5.5M)
  • Remaining 25-Man Roster Spots ($4.815M): Nine at $535,000 league minimum.
  • Remaining 40-Man Roster Spots: Estimated at $2M total.
  • Benefits: Estimated at $12M.

A-Rod and McCann are gone but their impact on the luxury tax payroll is not. Rodriguez was released, and for payroll purposes, it’s like he’s still on the roster. The Yankees are still responsible for his $21M actual salary and $27.5M luxury tax hit in 2017. The team is also paying $5.5M of McCann’s $17M salary the next two years.

The guaranteed contracts and arbitration-eligible players account for 16 of the 25 active roster spots. Assuming the Yankees fill the other nine with kids making the league minimum, it works out to another $4.815M. Here’s the thing though: all those kids won’t make the league minimum. The guys who picked up service time this past season, like Gary Sanchez and Aaron Judge and Luis Severino, will make a little more. Most teams, including the Yankees, have a sliding pay scale based on service time.

(Betances actually refused to sign his 2016 contract because he felt he deserved more than the team’s sliding service time scale, so the Yankees renewed him at the league minimum. That rarely happens though, and if the Yankees renew all their players at the minimum to create more payroll flexibility, it would also create a lot of bad blood. The easiest way to turn players against you is by screwing with their salary.)

Anyway, we’re going to stick with that $4.815M figure for the other nine roster spots for the time being. The other 15 40-man roster spots, the guys who are in the minors, also count against the payroll. They all have split contracts though — one salary in the big leagues, another in the minors. I’ve seen those other 15 spots estimated at anywhere from $2M to $5M over the years. I’ll go with $2M for the time.

Okay, so after all of that, our hypothetical 40-man roster is full and accounted for. Add it all together and the Yankees are at $202.2M. Argh! Over the threshold! But wait! It gets worse. Each team’s contribution to player benefits counts against the luxury payroll. Womp womp. That figure was $12M two years ago. I have no idea what it is now, but chances are it’s gone up at least somewhat.

Even if the benefits package is still valued at $12M, the Yankees are over the luxury tax threshold at $214.2M. And that’s assuming a) nine dudes on the 25-man roster are making exactly the league minimum, b) the other 15 guys on the 40-man are making only $2M total, and c) the Yankees make no in-season moves. Every call-up from Triple-A adds to the luxury tax payroll. In reality, the team’s payroll for luxury tax purposes is higher than that $214.2M number.

* * *

Based on everything that’s been reported this offseason, the Yankees are trying to unload Gardner and Headley in trades, which would free up cash. Dumping both would clear $24.72M in luxury tax hits, which gets them under the threshold with very little breathing room. Not enough to account for the fact players will be called up during the season and most of those nine league minimum guys will actually make something slightly more than the league minimum.

The chances of the Yankees getting under the luxury tax threshold next season were very small as it was. The Chapman deal effective ends any chance of it happening. Barring a Gardner trade, the Yankees are likely to open the 2017 season with a payroll in the $220M range, which is right where they’ve been the last two years. Next season, when Sabathia and A-Rod and Holliday and Clippard are gone, the Yankees should finally be able to get under the threshold, reset their tax rate, and create the payroll flexibility ownership so clearly desires.

Mailbag: Choo, Duffy, Ventura, Solarte, Espinosa, Betances

Only eleven questions in the mailbag this week. I had a few lined up that were rendered moot by the Aroldis Chapman signing. What about getting this guy instead of Chapman? That sort of thing. So blame the Yankees and Chapman for the relatively short mailbag. Anyway, RABmailbag (at) gmail (dot) com is the place to send your questions throughout the week.

Choo. (Elsa/Getty)
Choo. (Elsa/Getty)

Jim asks: Ellsbury for Shin-soo Choo?

You know, I don’t think this is completely impossible. Jacoby Ellsbury (four years, $89.6M) and Shin-Soo Choo (four years, $82M) have basically the same about of years and dollars left on their contracts, so it would be a wash financially. (Or at least the money is close enough that working it out shouldn’t be difficult.) The teams would be swapping players who provide different things and fill different needs. An actual baseball trade. How about that?

The Rangers were said to be looking for both a left fielder and center fielder this offseason, and re-signing Carlos Gomez addresses one of those spots. Gomez played left field in deference to Ian Desmond late last season (which was completely backwards, but I digress), after being released by the Astros and signing with Texas. The Rangers could play Gomez in left, Ellsbury in center, and rookie Nomar Mazara in right. See? Perfect.

The Yankees, on the other hand, would be replacing one of their low power lefty hitting leadoff types with a better offensive player. Choo battled injuries all season and still managed a .242/.357/.399 (105 wRC+) batting line. Ellsbury hasn’t had an OBP that good since 2011 or a wRC+ that good since 2014. Choo is a year removed from hitting .276/.375/.463 (129 wRC+) with 22 homers, remember.

It boils down to preference. Would the Yankees rather have the small bat/big glove player, or the big bat/small glove player? Choo is going to be a full-time DH before long and the Yankees do have an opening there going forward. No-trade clauses and things like that will complicate this, but if the Rangers are game, I think this would be worthwhile for the Yankees. They have center field alternatives and need the lefty offensive might.

Matt asks: You’ve recently said that you’d like to see Monument Park more prominently displayed at The Stadium and I 1000% agree. It should be the crown jewel of the ballpark. If they put you in charge of the project, how would you show off Monument Park?

I don’t see a great solution given the ballpark. I think the best possible solution would be creating a double decker bullpen — Citizens Bank Park, Progressive Field, and Camden Yards all have them — on one side of the restaurant in center field, with Monument Park in the other side where the other bullpen currently sits. The Yankees would have to rip out seats to make that happen, but they’re ripping out 2,000 seats this offseason anyway, so it doesn’t seem like that would be a deal-breaker. They’d be left with Monument Park on the left field side of the restaurant, a la the old Stadium, and the double decker bullpen on the right field side. (Road team gets the top bullpen so fans can heckle them, of course.) If anyone has a better solution, I’m all ears.

Ricky asks: I’ve read repeatedly that the Yankees need to sign a veteran catcher to mentor Gary Sanchez. They already have Joe Girardi, who, with Joe Torre mentored Jorge Posada, and Tony Pena, one of the top defensive catchers of his time, sitting on the bench. What am I missing? Aren’t these two more than capable of mentoring a young catcher?

Sure. I don’t think a veteran backup is necessary and I’m pretty sure I’ve never written that on RAB. I know I’ve said the Yankees might look into one, but it’s not necessary. Girardi and especially Pena do a ton of work with the catchers — Pena is always on the field with them before the game doing drills (blocking balls in the dirt, etc.) — and I’m not sure you could ask for a better catching coach tandem. Adding a veteran backstop would be about a) upgrading over Austin Romine, and b) having someone you’re comfortable running out there three or four days in a row should Sanchez need a little break at some point.

Duffman. (Ed Zurga/Getty)
Duffman. (Ed Zurga/Getty)

Ben asks: With the Royals looking to slash payroll, how about trading for Danny Duffy or Yordano Ventura?

Hard pass on Ventura. For starters, he isn’t all that good and he’s actually getting worse. He’s gradually gone from a 3.20 ERA (3.60 FIP) in 2014 to a 4.45 ERA (4.59 FIP) in 2016. Also, Ventura is kinda crazy. He’s incited several benches clearing brawls over the years because he gets angry when things don’t go his way, so he starts throwing at people. If you pitch inside and accidentally hit dudes, fine. It happens. When you can’t handle failure and start taking it out on the other team, that’s bad. No thanks.

As for Duffy, he’s really good and the only issue is that he’ll be a free agent next offseason. He’s not the young arm with long-term control he Yankees are a) seeking, and b) need. Duffy started this past season in the bullpen before moving to the rotation, where he had a 3.56 ERA (3.99 FIP) with a 25.4% strikeout rate in 161.2 innings. His injury history is pretty scary, but generally speaking, I think that’s the real Duffy. A mid-3.00s ERA guy with a ton of strikeouts. I’m not quite sure what it’ll cost to acquire Duffy, though I’m sure it’ll be a lot. Holding off and signing him as a free agent next offseason is probably the smarter move right now.

John asks: Any interest in Scott Feldman as maybe a poor mans Rich Hill? Threw 180 pretty good innings in both 2013-2014. Has maybe fourth starter potential, innings eater, swing man if at the right price.?

I dunno, 2013-14 was a very long time ago. This past season Feldman had a 3.97 ERA (4.24 FIP) in 77 innings with the Astros and Blue Jays, almost all in relief, and I’m sure he’d perform worse as a full-time starter in Yankee Stadium. He might not be the worst free agent swingman option in the world, someone who could be your long man and also provide some spot starts whenever the kids get overwhelmed. Would he take, say, one year and $2M? The Yankees would have a hard time justifying spending more on such a player.

Michael asks (short version): To what extent does the Yankees FO prioritize a player’s marketability in their decision-making process? Chris Sale and Jose Quintana may deliver essentially similar value on the field, but Sale is one of the most exciting players in the game today, a legitimate superstar, whereas Quintana is merely quietly, reliably efficient (a perception not helped by pitching in Sale’s shadow).

This is impossible to answer but I have zero doubt the Yankees — and every other team in the league, for that matter — consider a player’s marketability and marquee value when acquiring him. That’s one of the reasons the Yankees gave Ichiro Suzuki two years back in the day. (Two years!) They were able to market the hell out of him. I saw as many ICHIRO 31 shirts around the ballpark from 2013-14 as I did JETER 2 and RODRIGUEZ 13. As good as Quintana is, he’s kinda boring. Sale is more recognizable and more of a star. He’ll put more butts in the seats, and that’s something teams consider. How much? It’s impossible to know exactly, but it is undoubtedly a consideration.

Dan asks: Based on everything I’ve read about the team’s leadership core, Gardner seems to be the only position player left (you alluded to this on 11/18 in a post). Should that be a reason against trading him? How important are veteran mentors and good veteran clubhouse presences for young teams? Would it be stupid to not have any veterans known to be good mentors/leaders?

Based on everything we’ve heard the last few years, CC Sabathia and Brett Gardner are the remaining members of the team’s recent leadership core. Others like Mark Teixeira, Alex Rodriguez, Brian McCann, and Carlos Beltran are all done. Matt Holliday has long had a reputation for being a great clubhouse guy and I’m sure he’ll help fill some of the void. The Yankees are going to be a young team going forward, and they’ll need at least a few veterans to help show those kids the way.

That said, I don’t think leadership is something that stops a team from making moves. The Yankees have traded away McCann and Beltran (and Andrew Miller) and released A-Rod, so it’s obviously not a big concern. The Dodgers traded away A.J. Ellis, Clayton Kershaw’s good friend and personal catcher, in August. Leadership seems like one of those things teams want and need to have to some degree, but won’t go out of their way to acquire it in most cases. Talent comes first, or in the case of Gardner, shedding salary and clearing space for a younger player takes precedence over any clubhouse skills.

(Kent Horner/Getty)
(Kent Horner/Getty)

Joey asks: Any chance of the Solarte party returning to the Bronx?

The Padres have reportedly put Yangervis Solarte (and the rest of their roster) on the trade block, and a few teams have checked in. The Dodgers and Angels, most notably. The Yankees don’t have an obvious opening for him at this point. They’d have to trade Chase Headley — or Starlin Castro, I suppose, but that won’t happen — because trading for Solarte to be a bench player is pointless. You’re going to pay starting player prices for a bench guy. Nope.

The Yankees don’t have a long-term third baseman at the moment and Solarte would, if nothing else, buy them some more time to find one since he’s under control one more year than Headley. Salary dumping Headley in favor of Solarte would also save cash, which is a big deal given the luxury tax situation. So, to answer the question, is there any chance of a reunion? I’ll say yes, but it’s unlikely. Other clubs out there have a greater need for a second or third baseman, and will probably be more desperate. Solarte doesn’t change the Yankees’ long-term outlook much, if at all.

Adam asks: Is it worth pursuing Danny Espinosa of the Nationals to improve upon Torreyes and provide insurance for Didi and Castro?  If so, What might it take to get a deal done? 

Nah. He’s projected to make $5.3M through arbitration next year and that’s way, way too much for a utility infielder, especially since Espinosa was one of the worst hitting regulars in baseball in 2016. A few years ago I was on board with Espinosa, when he seemed to fall out of favor with the Nationals and the Yankees had no obvious long-term replacement for Robinson Cano or Derek Jeter, but those days are long gone. Ronald Torreyes is a perfectly fine utility infielder who costs nothing. Finding an upgrade there is very low on the offseason priority list.

Mark asks: Just a hypothetical, Reds select Torrens in Rule 5. Trade him to Padres. If he doesn’t stick, does he get offered back to the Reds or Yankees? Answer is probably obvious, but I’m curious. Y’all are AWESOME!

The Yankees. They’re still his original team. The Rule 5 Draft rules stick to Luis Torrens no matter how many times he’s traded or claimed on waivers next season.

I’m pretty confident Torrens will be offered back in Spring Training. Making the jump from Low-A to MLB as a 20-year-old catcher is basically impossible. The only real ramification for the Yankees is now they absolutely have to add Torrens to the 40-man roster next offseason. He’ll be Rule 5 Draft eligible again, and if someone takes him, he can elect free agency rather than return to the Yankees. Can’t allow that to happen. The Yankees might have been able to get away with leaving him protected another year had he not been selected this year, but no luck.

Gene asks: What kind of return could Betances bring from the Dodgers ?

I don’t think the Dodgers want to spend big on a closer at all. They seem to be making just enough of an effort to retain Kenley Jansen so they can say “we tried” when he signs elsewhere. I imagine Andrew Friedman doesn’t want to trade a boatload of prospects for a reliever either, but who knows. He’ll surprise me one of these days.

Dellin Betances‘ trade value is basically the same as Miller’s was this summer. It’s three years of Dellin vs. two and a half of Miller, but the bottom line is you’re getting each guy for three postseason runs. Both are excellent, and Betances won’t make as much as Miller either because he’s still in his team control years. The Miller trade is my template: two top prospects and two others. Whether the Dodgers are willing to pay that is another matter. They seem content to go with the Louis Colemans and Luis Avilans of the world.

Thursday Night Open Thread

The 2016 Winter Meetings are over. The Yankees got their closer and that’s pretty much it. From the sound of things, adding a starting pitcher is going to be pretty difficult. Free agency is a wasteland and pretty much nothing comes cheap on the trade market anymore. I seem to find myself saying “they gave up all that for him?” at every trade these days. At least the Yankees were on the good side of a few of those at the trade deadline.

Anyway, here is your open thread for the evening. The Raiders and Chiefs are the Thursday NFL game, plus all three local teams are playing. And there’s some college hoops on the docket too. Talk about those games, the week that was at the Winter Meetings, or anything else right here.

Commenting Guidelines Reminder

Just wanted to send out a reminder on our commenting policy.  No one wants to censor you, just be adults and kind to each other.

River Ave. Blues is the premier independent Yankee blog. With multiple posts and thousands of visitors a day, River Ave. Blues has developed into a community of knowledgeable and outspoken Yankee fans. As such, we have to lay out some commenting guidelines for those of who wish to contribute to the site.

First and foremost, we urge everyone who reads to comment. We know a lot of regular readers don’t like to comment, but feel free to stop by and say hi anytime. Now, on with the guidelines:

  1. River Ave. Blues now requires registration through Disqus for commenters. You need a valid email address to register. Neither RAB nor Disqus will share or redistribute your email address, and all email addresses are safe from the prying eyes of spammers.
  2. For the most part, everyone reading and commenting on RAB is a Yankee fan. Those who are not Yankee fans choose to enter the fray anyway. When arguing and opining about the Yankees, remember that we are all fans of the same team. To that end, personal attacks and insults will not be tolerated. Any comments that we deem libelous, defamatory, abusive, harassing or threatening will not be tolerated, and we may ban repeat offenders from contributing to the site. The same is true for fans of other teams who are here to insult Yankee fans. Constructive conversation, however, will not be stifled.
  3. Do not post links to or make mention of any unauthorized retransmissions of Major League Baseball game telecasts. These comments will be removed.
  4. While we try to limit profanity on site, we have not censored comments for profanity. We ask that you be judicious in your use of profanity and keep in mind that fans from all walks of life read and contribute to RAB.
  5. Keep comments on topic. Every day during the regular season, we will host a Game Thread. In that thread, feel free to discuss the Yanks, the news of the day, what’s happening in the game, etc. For the rest of the posts, do your best to keep comments related to the topic at hand.
  6. If your comment does not appear or you receive a message saying it is awaiting moderation, email us or simply wait. Those comments marked for moderation usually fail one of our spam tests, and we’ll approve them as soon as possible.
  7. Any comment written out in all capital letters will be deleted. That’s just unnecessary. Also, don’t tell us that you were “first” to post in a thread. We don’t care.
  8. Do not post the same comment in multiple threads. If you post something in one thread before another more appropriate post is published, feel free to repeat it, but do not abuse the privilege. Any repeat comments will be deleted, and if you continue to repost comments you’ll be banned.
  9. Do not post false breaking news. This is a zero tolerance item. You will be banned immediately if you are caught making up information.

We don’t delete comments very often, but we will when we have to. RAB has developed into a successful site because of our readers, and we want to encourage you to contribute. We also want to keep the conversations relevant and respectful. You may disagree with us but do so courteously, constructively and critically.

2016 Winter Meetings Open Thread: Thursday

(Jonathan Daniel/Getty)
(Jonathan Daniel/Getty)

The 2016 Winter Meetings wrap-up today from the Gaylord National Resort & Convention Center in National Harbor, Maryland. Late last night the Yankees swooped in and agreed to re-sign Aroldis Chapman to a five-year contract worth $86M, which is easily the largest reliever contract in history. Now the team can move on to other business, like adding rotation and middle relief help.

“I’ve got a lot of different things going on,” said Brian Cashman to Bryan Hoch. “Listen, they’ve got a time frame in free agency. They’re going through their process. In the meantime, I’m doing a whole bunch of other stuff at the same time. I’ve had several conversations with various agents today and a lot of club activity at the same time.”

On Wednesday we learned the Yankees have cast a wide net for bullpen help and have checked in on White Sox closer David Robertson and free agent Sergio Romo. Also, they want Ruben Tejada and Nick Rumbelow on minor league deals. We’ll once again keep track of the day’s Yankees-related rumors right here, so make sure you check back often. I can’t promise a ton of updates. The final day of the Winter Meetings is traditionally the slowest. All time stamps are Eastern Time.

  • 9:30am: When asked about recent rumors involving Brett Gardner and the Orioles, Cashman said he wouldn’t have a problem making a trade within the AL East. “If I can trade with the Red Sox and Mets, I can trade with the Orioles,” he said. Interestingly, Cashman said he tried to trade Ivan Nova to the O’s at the deadline. [Pete Caldera, Hoch]
  • 10:29am: Cashman doesn’t expect to pursue any more position players this offseason. The focus is pitching. “It’s unlikely for us to make any changes on the position player side unless we trade Gardy,” said the GM, who added he’s rejected offers for Chase Headley. [Caldera]
  • 11:23am: Not surprisingly, Cashman said the Yankees are basically out of spending money this offseason after signing Chapman. Good thing the free agent class stinks, huh? [Andrew Marchand]
  • 12:24pm: Once again, Cashman reiterated he’s not optimistic about improving the rotation this offseason. “I don’t anticipate adding any starting pitching. I’d love to if I could but I doubt it’s realistic,” said the GM. [Marchand, Erik Boland]

Reminder: Your trade proposal sucks.

Shohei Otani still expected to be posted next offseason, which is great news for the Yankees

(Atsushi Tomura/Getty)
Otani or Ohtani? Neither, actually. (Atsushi Tomura/Getty)

Earlier this week we learned Shohei Otani, the best pitcher (and hitter?) in the world not under contract with an MLB team, hopes to come over to MLB next offseason. The new Collective Bargaining Agreement means Otani will be subject to the international spending cap, severely limiting his earning potential. Hard to believe MLB and the MLBPA created a system that incentivizes a great player to stay away from the league, but here we are.

Anyway, according to Jim Allen, Otani’s manager with the Nippon Ham Fighters, Hideki Kuriyama, said he still expects Otani to come over next offseason despite the hard cap. He’s doing it for the challenge, not necessarily the money. “I think money is not a matter for Shohei. I think what he has in his mind is where and what kind of batters he wants to face,” said Kuriyama to Kyoto.

Needless to say, Otani coming over next season is good news for the Yankees. He’s a potential ace who will turn 23 in July, meaning he has so many prime years ahead of him. Otani would fit right in with New York’s youth movement. He’d be the centerpiece of the youth movement on the pitching side. Three other factors would make his decision to come over next offseason very good for the Yankees.

1. Several other big market teams will still be limited by the international spending penalties. The Yankees are currently riding out the second year of the penalties associated with their 2014-15 international spending spree. They were limited to $300,000 maximum bonuses during both the 2015-16 and 2016-17 signing periods. Come the 2017-18 signing period, the one Otani will count against next offseason, they’re free to spend again.

Other big market teams are not so lucky. The penalties do carry over to the next CBA — you didn’t think MLB would let those teams get away easy, did you? — which means the Athletics, Astros, Braves, Cardinals, Cubs, Dodgers, Giants, Nationals, Padres, Reds, and Royals will all still be dealing with the penalties from their recent international spending sprees. They can’t offer Otani more than $300,000. Right off the bat, potential suitors like the contending Astros, Cardinals, Cubs, Dodgers, Giants, and Nats are out of the race. The Yankees, Red Sox, Blue Jays, Tigers, Mariners, and Rangers will be the only traditional big market clubs not subject to the $300,000 limit.

2. The release fee still applies. There are two systems in play here. First, the posting agreement between MLB and NPB, which allows Otani to come over. And two, MLB’s international hard caps. Otani has to be posted, which means the (Ham) Fighters will presumably seek the maximum $20M release fee. Not every team can afford to pay that upfront. Well, they can, but some choose not to. The Yankees have no such problem. They’ll cut a $20M check no problem, like they did with Masahiro Tanaka and, ugh, Kei Igawa.

3. Otani will be insanely cheap. This is how it will work, as things stand. Otani gets posted and some team agrees to sign him for what I assume will be their entire international pool. That team pays the (Ham) Fighters the $20M release fee. Otani comes to Spring Training as a non-roster invitee (minor league contracts only for international players!), makes the team, and plays the 2018-20 seasons as a pre-arbitration eligible player making something close to the league minimum. An ace at that salary is basically the most valuable commodity in baseball.

Could a team promise to give Otani, say, an eight-year extension worth $180M at some point next year? Sure. But as Ben Badler notes, MLB would likely see such an arrangement as intentional circumvention of the hard cap and put an end to it. Otani, who made roughly $1.75M in 2016 and recently signed a $2.36M contract for 2017, won’t be able to truly cash in until his arbitration-eligible years. At that point I’m guessing MLB and especially the MLBPA would be okay with a big extension. If not, a grievance will surely follow.

* * *

The new CBA really screws over Otani, who is still making good money in Japan, but not nearly what he could be making over here. He’ll get a nice bonus when he signs next year, then have to settle for the big league minimum for a few years. It’s a fraction of what he’d get had he not been eligible for the spending cap because of his age. So much can go wrong from 2017-20, before the big extension, which really sucks. Otani has to assume a lot of risk.

Unless MLB makes Otani exempt from the hard cap — Ken Rosenthal has been told from MLB as well as teams there won’t be an exemption — in which case everything changes, the Yankees will be in great position to sign him next offseason. So may other big market clubs are dealing with the $300,000 limit, and many of clubs that aren’t can’t afford to fork over a $20M release fee. The Yankees also have the advantage of saying, “Hey, we’re in New York, so you’ll be able to make millions in endorsements for the time being.” (The downside: Every team can offer similar money.)

As it stands, the hard cap is incredibly unfair to Otani and a godsend for the Yankees. It makes the signing so incredibly low risk because all they’d have to pay is the release fee ($20M), his bonus ($4.75M), and three years at the minimum-ish salary ($2M, tops). That’s $26.75M total. How could they not go after him at that price given his upside? If Otani does intend to come over next season despite the hard cap, the Yankees couldn’t ask to be in a better situation. So much is working in their favor.