Tigers have less than $ 2.1 million to spend on 2012 draft.
by Tigerdog1 on Feb 20, 2012 4:00 PM EST
in Detroit Tigers Analysis
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PrintThe new limitations on what clubs can spend in draft bonuses under the terms of the new collective bargaining agreement are becoming clearer. Baseball America has published the amounts of the "pools" that clubs will be able to spend on player bonuses without being penalized. The Tigers have the second lowest bonus pool, which adds up to $2,099,300 for the first ten rounds of the draft.
The amount that the Tigers can spend is significantly lower because they will surrender their first round pick to the Brewers for signing Prince Fielder. Not only do the Tigers lose the pick, but they also lose the "slot bonus" that is allocated with that pick. A significant percentage of signing bonuses is given to players drafted in the first round. Only the Angels, who will lose their first and second round picks for signing CJ Wilson and Albert Pujols, will have a smaller bonus pool than the Tigers this year.
The Tigers will be able to spend their roughly $2.1 million total on the nine players drafted from Rounds 2 through 10. Any player drafted after round 10 may only be paid a bonus of $ 100,000.00 or else their bonus will also be counted against the club’s total "pool" limit. The Tigers did not add any supplemental draft picks, and thus did not add to their "pool amount" because they did not offer arbitration to any departing free agents this winter.
By contrast, the Twins will have the largest pool, almost six times as much as the Tigers, at $12,368,200. The Twins lost Michael Cuddyer, Joe Nathan, and Jason Kubel this off season. Minnesota signed Josh Willingham to partially replace the production of Kubel and Cuddyer, and they will pick up a pair of first-round picks, along with the slot money to spend on them. Not a bad deal in terms of building for the future.
The penalties for clubs paying bonuses above their pool amount are severe. Any club that exceeds its bonus pool by up to 5 percent must pay a 75 percent tax on the overage. Any club that exceeds its bonus pool by 5 to 10 percent must pay a 75 percent tax, plus they lose a first round pick in the next draft. Going above that amount will cost a 100 percent tax and the loss of first- and second-rounders for a 10-15 percent overage; and a 100 percent tax and the loss of two first-rounders for an overage of 15 percent or more.
The new rules figure to dramatically change the way that the Tigers have draft in future years. Gone is the ability to offer a major league contract to a player in his first pro contract, as the Tigers did with Justin Verlander, Rick Porcello and Jacob Turner.. Gone is the ability to make up for not having a first round pick, by simply grabbing a player in the later rounds and paying him well over slot, as the Tigers did with Nick Castellanos, who received the highest non first round bonus at the time that he signed.
The bonus pool amount that the Tigers have to spend is actually slightly higher than what they spent in the 2011 draft, as the Tigers also did not have a first round pick because they signed Victor Martinez during the previous off season. Also limited will be the amount that clubs may dish out in bonuses to international free agents, but that is a separate amount.
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this.
so much.
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by DetroitTigersGeek on Feb 20, 2012 4:22 PM EST up reply actions
Is there any rule that stops a team
From using 98% of their money on one guy?
In other words, the Tigers see someone they like and draft him, paying him $1.9MM. Then, they draft other guys mostly through the other 9 rounds who either won’t demand a big payday or the Tigers just don’t sign.
If your parents didn't have any children, chances are you won't either
That's allowed
but players would be reluctant to sign for less than the slot amount. There is some speculation that a club like the Yankees might just blow off the limits and go for a huge signability pick in the first round, giving up their top two picks next year. That would only happen if a once in a lifetime high schooler falls to them.
The bonus for a supplemental first round pick was in the $ 1 million range, and going down from there as the draft progressed. Just about all the huge bonuses have gone to first round picks.
"King of Minutiae"
My understanding:
that strategy would end up costing teams dearly.
If you don’t sign a pick the signing bonus pool is reduced (can’t use it on a another player).
The “luxury tax” part of the system would burn teams.
If a team is 0-5% over pool (after subtracting out unsigned players) they pay a 75% tax on the overage.
5-10% cost team 75% plus loss of 1st round pick, 10-15% lose 1st and 2nd round picks, 15% 100% tax on overage and loss of 1st round pick in each of the next 2 drafts.
So, if the Tigers are allotted 1 million for first round and fail to sign that player their pool is reduced to 1,099, 300. If they sign a 2nd round pick to 2 mil bonus they will have to pay the 100% tax on overage and forfeit the next two draft picks.
I have not seen that twist before
From the report on MLB.com
e. Rule 4 Draft
1. The draft will continue to be conducted in June, but the signing deadline will be moved
to a date between July 12 and July 18 depending on the date of the All-Star Game.
2. Drafted players may only sign Minor League contracts.
3. Signing Bonus Pools
A. Each Club will be assigned an aggregate Signing Bonus Pool prior to each draft.
For the purpose of calculating the Signing Bonus Pools, each pick in the first 10
rounds of the draft has been assigned a value. (These values will grow each year
with the rate of growth of industry revenue.)
A Club’s Signing Bonus Pool equals the sum of the values of that Club’s selections in the first 10 rounds of the draft. Players selected after the 10th round do not count against a Club’s Signing Bonus Pool if they receive bonuses up to $100,000. Any amounts paid in excess of $100,000 will count against the Pool.
"King of Minutiae"
I have not read that not signing a player reduces the pool amount
If you have a link, I’d like to see it.
"King of Minutiae"
I'll see what I find
I used the heading “my understanding” to allude to my uncertainty.
Probably send a tweet to Badler or Callis and see what they have to say or keep an eye out for an interpretation.
Thanks for the post and info.
this is kind of the argument:
Notably, if you don’t sign one of your picks in the first 10 rounds, you can’t spend that money on other picks. You lose that allotment from your signing allowance. Also, any bonus for more than $100,000 for a pick after the 10th round also counts as part of a team’s signing allowance.
Overage
If you include the overage allowed, the Tigers have about another $100000 to spend before they lose a draft pick. Not much, but that could be a flier in the 9th or 10th round, like Kyle Ryan.
Also, it’s important to note, that all clubs are affected by this to some degree. It’s just a reallocation of funds from draft picks to major league players. Maybe that’s why Prince got such a huge deal – Ilitch knew he couldn’t spend it in the draft!
A rule
designed to punish teams for investing in future stars and reward teams who can afford to spend on current stars.
No sir, I don’t like it. I don’t like it one bit.
by Big Z in Orlando on Feb 20, 2012 5:06 PM EST reply actions
Seems to me
A very likely consequence of this is that high school stars seeking a big bonus could very well go undrafted if the teams with a large pool either opt for other players or simply don’t want to risk not signing a guy and still having the slot amount count against the pool. Yet another reason to hate this rule.
why yes, I'm slightly drunk at the moment
by Mark in Chicago on Feb 20, 2012 6:38 PM EST reply actions
I think college coaches are the only people that actually like this rule
Other than an increased number of guys who go to college because they don’t get a significant signing bonus, I don’t see anyone else that would actually like this rule.
It rewards those owners who didn't want to risk investing in the draft.
And don’t want to spend on free agents because some players are going to fall to them.
I've never understood this...
why is it that we have to give up a draft pick when we sign someone who is a free agent? I know the pick goes to the team that the player came from, but why do they get rewarded with another draft pick, when we signed a guy who doesn’t want to be there anymore? None of the other sports do this, do they?
It's going to be severely limited starting next year
Other sports have had draft pick compensation systems in the past, but they’ve mostly been replaced with other systems. The theory is to prevent wealthy teams from buying up all the talent, and to compensate the poorer clubs that can’t afford to keep the star players that they’ve developed. It’s not just a matter of the players not wanting to be there. It’s a matter of clubs being able to afford the most expensive players.
After this season, a club will have to make a “qualifying offer” to any free agent, that is equal to the average salary of the top 125 major league players. As of 2011, that amount was about $ 12.4 million. If that offer is not made, the team will not be compensated, and the signing team will not pay compensation.
Example: Jose Valverde makes $ 9 million this year, and his contract is up after the 2012 season. If the Tigers don’t extend him, they’ll have to offer him a contract, probably for one year at $ 13 million or so, or they won’t get compensation if he signs with another team. If he’s anything close to what he was last year, he can get a multi year contract, but that’s still a lot of money to pay for a relief pitcher. Only a couple of closers get paid in that range.
"King of Minutiae"
What Is The Penalty?
. Baseball America has published the amounts of the “pools” that clubs will be able to spend on player bonuses without being penalized.
Depending on how much the penalty might be as long as there is not hard cap on what can be spent I can see the Tigers signing a player even it meant paying a one time penalty if the penalty is not too large.
But the penalties are very severe
even if a club decided that they were willing to spend the money, only 5% over the total slot amount and they have to give up next year’s first round pick.
Either players will be accepting smaller bonuses, or they will stay in college, in most cases on a full scholarship, and see if they can improve their stock for the next draft.
I would not be at all surprised to see a legal challenge to this system from a player that has not yet been drafted, or that is drafted and can’t get what he thinks is a reasonable bonus because someone else negotiated away his rights.
"King of Minutiae"
Someone will
Some club will blow off the system and go hard after a star player
and some player will be unfairly limited and challenge the system in court.
But until then, these new rules will probably have the impact that they are designed to have.
A few more players may go to college on scholarship instead of taking the instant bonus.
"King of Minutiae"
Baseball is limiting what a player can be paid.
This sounds like Curt Flood part two.
Loop Hole
Should a Turner or Castellonos slip… I see a loop hole where a team could throw him a million dollar bonus,but sign him to a major league contract that pays him say four million over four years…I dont see this happening alot as forty man roster spots are not given out freely & the players arbitration years would start higher(ala rick porcello) however for a team like the tigers that are short on draft picks & have the likes of Ortega, Tomas, & Perez @ the bottom of there roster…using this stratagy would still allow you to snag a guy whos droped severely do to bonus demands…its a risky gamble, but when you continuosly forfiet your first rd picks, it may be a necessary one
by Wolverine119 on Feb 21, 2012 1:41 AM EST via mobile reply actions
Read the CBA
No major league contracts…there goes that idea…wonder of you could put other “clauses” in the contract…like say…garunteed to be place on 40 man roster that fal..thus starting the countdown of hos options the following spring…idkl…im sure GMs will come up w something
by Wolverine119 on Feb 21, 2012 4:44 AM EST via mobile up reply actions
Question
What’s the rule on contract incentives for drafted players? It seems to me that incentive-loaded contracts could be a loophole here if there’s little in the way of restrictions on them.
Can't sign major league contracts
so they are very limited in that regard. Minor league pay isn’t very good. $ 35 to 70K per season at the upper levels.
"King of Minutiae"
I'd take that money to work out all year and play baseball. The health insurance is probably really good too.
by ottisfranklin on Feb 21, 2012 4:44 PM EST up reply actions
and the vast majority of these players won't ever have more than a few years of a career
So, they hopefully get a college education to help them if/ when their baseball days are done. The ones that give up their education for a signing bonus that seems like a lot of money to them at the time, could be making a big mistake.
"King of Minutiae"
Well crap
My job this summer is going to be boring.
"You, on the other hand, make Eeyore look like Rainbow Brite." -johnmoz
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