Short-term extensions for Pineda and Eovaldi make sense for Yankees

This coming Friday is a rather significant offseason date. It’s the deadline for teams and their arbitration-eligible players to exchange salary figures, which is something both sides try to avoid. Arbitration is an acrimonious process that could potentially damage relationships. It’s not fun sitting through an arbitration hearing while your team details your shortcomings and explains why you aren’t worth as much as you think. Exchanging salary figures is step one in that process.

The Yankees haven’t been to an arbitration hearing since beating Chien-Ming Wang in 2008 — he earned $4M instead of $4.6M in 2008, and while that doesn’t sound like much of a difference, the savings carry over into future years as well — and I can’t even remember the last time they got as far as exchanging salary figures with a player. They’ve signed all of their arbitration-eligible players before the deadline to submit salary figures the last several years and I have no reason to think this year will be any different.

The Yankees started the offseason with seven arbitration-eligible players and are now down to four after a series of trades and non-tenders and signings. They’ve already avoided arbitration with Esmil Rogers by giving him a one-year deal worth $1.48M — that represents the maximum allowable pay cut from his 2014 salary, so it seems the Yankees said take this or we’ll non-tender you — and the four unsigned arbitration-eligible players are setup man David Carpenter, the injured Ivan Nova, and two pitchers with a bit more than three years of service time in Nathan Eovaldi and Michael Pineda.

The three-year service time level is a weird place for starting pitchers. They’re hitting arbitration for the first time, which is right when you’d expect teams to lock up their top young arms with long-term extensions. But that hasn’t been the case recently. According to MLBTR’s Extension Tracker, Johnny Cueto is the only pitcher to sign long-term at that service time level since 2009. He received a four-year contract worth $27M with one option year.

Aside from Cueto, five other pitchers at the three-year service time level have signed multi-year extensions since 2009, and all five were two-year contracts with no options. All those deals did for the team was buy short-term cost certainty. The pitcher got a nice little payday while remaining arbitration-eligible one time after the two-year contract expired and still hitting free agency the year after that. It’s about short-term cost control, that’s it. It’s a bridge deal, so to speak.

With Eovaldi and Pineda arbitration-eligible for the first time this year, the Yankees could follow suit and sign one or both to short-term bridge deals now that the no extensions policy is no longer in place. A two-year deal makes a lot of sense for the team, I think. Both Eovaldi and Pineda carry enough questions — transition to the AL and injuries, respectively — that a long-term contract would be really risky, but they also have enough potential that they could take off in 2015 and cost a fortune through arbitration in 2016.

So, with that in mind, let’s quickly compare Eovaldi and Pineda to four of the five pitchers who signed two-year bridge contracts in recent seasons. The fifth pitcher, the one I’m excluding, is Clayton Kershaw, who isn’t comparable to anyone given his otherworldly performance. He was poised to smash arbitration salary records before signing his two-year deal.

Eovaldi and Pineda are projected to earn $3.1M and $2.1M through arbitration this coming season, respectively, according to MLBTR’s model. There is no perfect comparison here given their somewhat unusual career paths, particularly Pineda, but there are never perfect comparisons anyway. All the Mat Latos, Jhoulys Chacin, Kyle Kendrick, and Jason Hammel contracts do is give us a ballpark number.

Based on performance and projected salary, the Kendrick and Hammel contracts appear to work as comparables for Eovaldi, but there’s a big catch: both Kendrick and Hammel were Super Twos who signed their bridge deals in their second of four trips through arbitration. They earned $2.45M and $1.9M their first times through arbitration, respectively. That complicates things. Those two were starting from a much higher base salary.

Had he not spent most of the last three seasons injured, Pineda could have been in line for Latos money this offseason, if not more. Actually, if he had been healthy, he would have been arbitration-eligible for the first time last winter. The Yankees optioned him to Triple-A two years ago after he completed his rehab and he spent enough time in the minors to push his arbitration-eligibility (and free agency) back a year.

Since this is an apples to oranges comparison, let’s look at it another way. Based on his salary in the first year of his bridge deal, Latos received a 171% raise in year two. Chacin received a 294% raise, Kendrick a 150% raise, and Hammel a 158% raise. Chacin is a huge outlier for whatever reason. Ignoring him, the other three averaged a 160% raise from year one to year two of their bridge deals. (Kershaw received a 146% raise from year one to year two of his contract, so even he’s in the same ballpark.)

If we apply that 160% raise to Eovaldi’s and Pineda’s projected 2015 salary, we get two-year contracts worth approximately $8.1M and $5.5M, respectively. That’s $3.1M in year one and $5M in year two for Eovaldi, and $2.1M in year one and $3.4M in year two for Pineda. This isn’t the most precise salary forecast in the world but we’re only looking for a ballpark number for discussion purposes, not an exact projection for a detailed analysis.

I don’t know about you, but I’d give Pineda two years and $5.5M in a heartbeat. Yes, I know he’s risky as hell, but it’s super cheap and he flat out dominated when on the mound last season. If he stays healthy this coming year and continues pitching anywhere close to that level, he’ll get a massive raise come 2016. Pineda signed for a small bonus as an amateur back in the day ($35,000!) and he’s already had one major shoulder surgery. He might jump at the guaranteed millions. I know I would.

As for Eovaldi, two years and $8.1M is a drop in the bucket for New York, though I wish we could see him in action in the AL East and Yankee Stadium before committing. Even if he were to flop next season, I think he’d still have plenty of trade value next offseason even with a $5M salary already set in stone for 2016. He’s young and throws hard. Teams are always looking for someone like that. It’s easy to say sign him, but I would understand passing and going year-to-year as well.

The big long-term extensions are fun and usually lead to tremendous savings in the future, but starting pitchers have been treated differently in recent years. At least pitchers at Eovaldi’s and Pineda’s service time level. A two-year bridge deal doesn’t buy up any free agent years or anything like that, but it does limit risk and could help the Yankees save some money not only in 2016, but also in 2017 since the savings career over. (Arbitration uses the player’s salary in the previous year as a base.)

There has been no indication the Yankees are considering a multi-year extension for any player right now, even a short two-year deal for Eovaldi and Pineda. That doesn’t mean they haven’t at least kicked around the idea though. It’s understandable if they simply sign both guys to a one-year contract for 2015 since Eovaldi has yet to throw a pitch in pinstripes and Pineda has made only 13 starts in the last three years, but a two-year bridge contract for either pitcher has the potential to be very beneficial. For both sides, really.