Are the Yankees trying to cut spending?

From a more practical standpoint, the big question is whether the Yankees can meet these payroll targets. The Yankees already have a little over $80 million spent just on their commitments to A-Rod, C.C. Sabathia, Mark Teixeira, and Derek Jeter in 2014, the year they’re targeting for the spending reduction. If Robinson Cano and Curtis Granderson get new contracts before that season, the number will be closer to $120 million, leaving somewhere between $60-70 million to fill out the roster (and if the method of calculating payroll for luxury tax purposes hasn’t changed, it will be even less than that, since that number is based on a contract’s AAV, meaning the hit for Jeter and A-Rod will be larger). Brett Gardner and David Robertson will be in their final year of arbitration, while Ivan Nova will be in his first. That probably adds another $15 million or so (or more, depending on what the reliever market does between now and then), leaving us with about $50 million, give or take, for a starting right-fielder, catcher, and three starting pitchers.

So, actually, this is perfectly doable, especially if the farm system can crank out a couple of starting pitchers and a starting catcher between now and then. The real intrigue will come if a truly tantalizing free agent comes along that forces the Yankees to choose between fiscal discipline and acquiring a free agent they really like (Cole Hamels being the obvious possibility, if he hits the market). With so much money potentially riding on getting below the $189 million threshold, we may potentially see just how much more committed to dollars and sense the new ownership group is than Yankee fans have been accustomed to during the Steinbrenner ownership.

Finally, I’d be remiss if I didn’t point out yet again that the MLBPA did a bang up job helping the owners out in the last round of CBA negotiations. I mean, there’s no way this much financial incentive for big market teams to control their payroll will limit the salaries top free agents are paid and thus suppress the market for other players moving forward, right? Well at least there will be five or six more Super Twos every year. Heckuva job MLBPA.

10 thoughts on “Are the Yankees trying to cut spending?

  1. jay_robertson

    Was there any hint that this was coming; or – any chance that the implementation of the draconian, obviously Yankee-centric penalties could be delayed a year or two? I realize, its a couple years in the future, but from the numbers being bandied about this morning, if the Yankees are to be under budget by 2014, the entire lineup may well look as lopsided as our current pitching rotation.

    Instead of CC & the ? Marks, we'll have CC, A-Rod, Tex, Cano, and Grandy – and prly Jeter – with everyone else on roster making something a lot closer to league minimum. I guess that'll work – at least it will give some "competitive balance," since there's no way the team will make the playoffs with such a top-heavy lineup of AARP candidates backed up by AAA players.

    • BrienJackson

      Not this specifically, but I think most people expected Selig to push for something like this. And to be fair, it's a real stretch to call it draconian, as this is much more carrot than stick. Basically the Yankees are being enticed by the prospect of tens of millions of dollars in profits to get below the target for 2014, with no real penalty for going over it.

      • jay_robertson

        I'll admit to ignorance – "draconian" referred to the habitual violator clause – where the tax goes up to 50%. If that was already on the books, then for sure – its more carrot than stick, and I take it back. I just don't see a good way to get a balanced lineup by 2014, with all the hideous (or, just extravagant) contracts already on the books.

        Unless – maybe there's also a hidden clause allowing teams to renege on a budget-busting contract if cancelling said contract brings them below the Luxury Tax Limit? THAT would be great. :D

        • BrienJackson

          Well the lineup is pretty simple:

          1B Tex
          2B Cano
          SS Jeter
          3B A-Rod
          LF-Gardner
          CF-Granderson
          RF-???
          C- Romine
          DH- Montero

          That's the ideal scenario, and there's no particular reason they shouldn't be able to make that happen on a $189 million budget if Romine can be an everyday catcher by then. The sore thumb (no pun intended) is A-rod, obviously, but Hal and Hank made that bed themselves 4 years ago.

          • jay_robertson

            Ok – but this will pretty much preclude a big name free agent starter or two, won't it? Looking at that, I'd think that Cashman would be willing to bet a fair bit on Darvish – since the posting fee doesn't count against luxury tax, and I'd imagine the brothers could come up with some way to front-load the contract and make it look like he isn't getting much…

            Guess it can work, if we can get functional starters for under 10 mil apiece – better hope Hughes and the B's hold up (as well as Nova and Noessi.)

          • BrienJackson

            Hard to say, but the only pitcher that really fits that bill in the upcoming years is Hamels, and I can neither see him hitting the open market nor the Yankees passing on him if he does.

  2. sam

    repelling into the meetings is something the marlins GM should be doing, not the GM that passes on everyone for fiscal discipline.. time for a pitcher.

  3. Hank

    You left out some significant stuff:
    1) The bench is at least 2mil even with league minimum deals for 4 people. (more likely than not many of these are in the 1-2mil range each, maybe 1 or 2 people on the bench are promoted from wihtinan making league min)

    2) You completely ignore the pen – it looks like you have accounted for one reliever (Robertson) leaving 6 bullpen spots… again, if every one of these is league min that is 3 mil (and there's ZERO chance the Yankees use Robertson and 6 league min guys in the pen in 2014)

    So the pen and bench are another 5mil as an absolute bare minumum (10 spots after Robertson))… figure at least 10-15mil if they go the ultra cheap route (find a bunch or 1mil type bench players and relief arms)…. but it's more likely to be in the 20-25mil range…. and if the yankees add any type of setup/LOOGY of the day type arm….

    So instead of 50 mil for a RF, catcher (if not Romine?), and 3 starters you probably have closer to 25-30mil (maybe less) for those spots. That's "doable" but a real stretch as it means you probably need 2 quality starters from the minors (which allows a mid level type deal for 1 starter and a mid level RF and a relatively cheap catcher (or Romine?)

    I think the only way the Yankees could realistically do this is to hope for a real favorable deal with Granderson or let him walk (shift Gardner to CF and go for a cheaper option in LF to leave money for the open spots you talked about. and hit the jackpot with minor league pitching.( I'm assuming Cano get resigned in any scenario)

  4. Allen

    Could they sign Cepedes and Darvish to minor league deals with massive signing bonuses and fill two of those slots with potential high impact guys making the league minimum? Because that would be a great way to spend Yankee money and hit that magic number at the same time.

    Darvish might have to wait a year (divorce and all), but if they can pull that off for Cepedes I'd be thrilled. And then next year, they can dump some of that future savings into overpaying on the posting fee for Darvish just to be on the safe side.

    • BrienJackson

      I'm a little fuzzy on how signing Cuban players works, but with Japanese players the posting fee isn't counted against anything, and the contracts themselves tend to be relative bargains (exclusive rights will do that). Remember that, for as much of a financial boondoggle as he wound up being, the Red Sox only paid Daisuke a seven-figure AAV.

      My guess is that both Cespedes and Darvish would be signed for an AAV of less than $10 million.

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