Passan on MLB Team Salaries

[Seth Stohs]

Yahoo Sports' Jeff Passan tweeted estimated team salaries recently (based on current rosters. It was before arbitration numbers came out, but used MLB TR's estimates which proved to be "close enough" for this analysis. Here are how the teams rank (with several free agents still out there and available (Note - I just took this from his tweets. There are just 29 teams listed... don't want to take the time to figure out which team is missing):

 

1. Dodgers ($262.6M),
2. Yankees ($210.9M),
3. Red Sox ($180.5M),
4. Tigers ($168.8M)  
5. Giants ($160.7M).
6. Washington $140,600,000
7. Philadelphia  $136,400,000
8. Texas $128,900,000
9. Toronto $122,500,000
10. Seattle $122,500,000
11. St. Louis $118,100,000
12. Baltimore $116,100,000
13. Chicago White Sox $114,600,000
14. Kansas City $112,100,000
15. Cincinnati $111,000,000
16. Chicago Cubs $108,500,000
17. Milwaukee $106,400,000
18. Minnesota $104,900,000
19. Colorado $99,500,000
20. NY Mets $96,700,000
21. Pittsburgh $93,500,000
22. Atlanta $93,000,000
23. SD $87,700,000
24. Arizona $85,400,000
25. Cleveland $83,000,000
26. Oakland $80,600,000
27. TB $73,500,000
28. Miami $66,900,000
29. Houston $64,700,000

 

He notes: "Worth remembering: There's still about $125M worth of 2015 salaries left on the free agent market, among Scherzer, Shields and lesser guys."

 

For instance, Nori Aoki signed with the Giants for $4 million after these numbers came out.

 

A couple of observations:

 

• The Twins are at 18th or 19th (depending on missing team)
• Some will say that the average team salary will be somewhere around $140-$145 million. Fair to say that the Dodgers and Yankees throw off those numbers.
• The median salary is (depending on one missing team) between $108 and $111 million. 
• That means that the Twins, at about $104M are about $7 million below that number... Considering how many young players should be on the roster (pre arbitration), that seems like a pretty reasonable place to be, especially considering where their team revenues likely rank relative to the rest of the league (particularly local TV revenues, which are the biggest chunk). 

 

 

[gunnarthor]

I'm honestly surprised they were this high and I think Ryan will do something during the season to lower it - maybe/hopefully move Nolasco.  I think the Twins can be a .500 team this year but if they aren't, I think ownership would be very unhappy having a 100m+ losing team. 

 

The other thought is that baseball's finances are in great shape and teams simply have a lot more money to spend and the players are getting a bigger piece.  I don't think salaries have necessarily kept up with the reported finical gains of the industry.  A few years ago, it was reported that baseball was a 6 billion a year industry.  A few days ago, I read they were now making 9 billion a year.  So the owners must be swimming in money.

[JB_Iowa]

i think the Angels are missing (unless I overlooked them) so that would probably push the Twins to 19.  Plus rhe median is likely to go up.

 

Still, an encouraging increase,

[ashbury]

With a median of $110M, there will be losing teams with a payroll over $100M.  Ownership should get used to it, if this is still causing heartburn.

 

Having a crop of promising rookies on the way isn't a reason to hold some arbitrary lowball line on payroll.  Use that money to fill gaps - preferably in ways that seem fungible, so that trades can be made when conditions evolve.  That seems to be what the Twins are doing, though they guessed wrong on Nolasco a year ago.

[Seth Stohs]

Yeah, I think Ownership is smart enough to see this trend... they're certainly smart enough to see the increasing TV revenues generated and how it works.

 

Also, look at this list and see which teams were in the playoffs and which weren't:

 

The Yankees, Red Sox and Phillies weren't in the playoffs. 

 

Increased payroll allows for more mistakes, but it always comes down to business decisions. I'm fully comfortable with where the Twins payroll for 2015 is relative to 1.) Their TV revenue compared to others, and 2.) the fact they are mixing higher-paid veterans with their young, talented guys who are making league minimum.

[Brandon]

KC is at 112 million? I suspect we should be able to top them. Maybe because we're at a different spot in the team cycle I guess.

[Thrylos]

I took a deep dive into payroll, market size and what the Twins can sustain, back right before the 2009 Spring Training (that's before Target Field.)  It was a 3 post series (last one here with links to the other ones if anyone interested)  and it was analysis based using several indicators.  My conclusion (6 years ago) was that the Twins can sustain a $100-125 million payroll.  Fast-forward to now, add the TV revenues, adjust for the market size, and the number should be more like $125-150 million.

 

Back then the Twin Cities were the 17th largest MLB market (that analysis here) I still think that this ranking is about right, so the ballpark of the player salaries is within the equation...

 

I find it interesting that back in 2009, saying that the Twins will have a $100+ payroll consistently was a radical idea, while now it is a given

[nytwinsfan]

I'm completely fine with this level of payroll now. My concerns are (1) that some of it was spent on pretty questionable contracts (Hunter, Pelfrey), and (2) that they won't spend more in 2-3 years when the Twins have a chance to really compete.

[ashbury]

that they won't spend more in 2-3 years when the Twins have a chance to really compete.

Big Pelf and Torii are gone after this year, leaving the known financial commitment around $70M, plus the "known unknowns" of arbitration salaries for Plouffe and Dozier and a few lesser salaries, somewhere in the neighborhood of $15M I suppose.  Factor in the "unknown unknowns," like trying to move Nolasco's contract sometime in the next 18 months, and I see plenty of room for new spending if the window for real contention is seen as opening.  Will they continue to open that checkbook?  The evidence of the last 14 months seems promising.

[jokin]

Big Pelf and Torii are gone after this year, leaving the known financial commitment around $70M, plus the "known unknowns" of arbitration salaries for Plouffe and Dozier and a few lesser salaries, somewhere in the neighborhood of $15M I suppose.  Factor in the "unknown unknowns," like trying to move Nolasco's contract sometime in the next 18 months, and I see plenty of room for new spending if the window for real contention is seen as opening.  Will they continue to open that checkbook?  The evidence of the last 14 months seems promising.

 

Add Duensing and Stauffer to the FA list, with Pelfrey and Hunter, that's potentially ~$22M off the books (and any or all four could all be gone no later than July 31 of this year, for that matter).  

 

In the arb department, Plouffe could also be gone by the deadline this year, as well-  that's another ~$6-8M perhaps not on the books next year-  As for some of the "few lesser salaries", Escobar goes to Arb 1... but... Milone, Nunez, T-Bar and Schafer all probably won't be around much longer, either (another ~$6M gone), the elimination of these 5 guys could really knock down your "known-unknowns" estimated arb number (dependent on what the return is in trade, particularly on Plouffe).  

 

Assuming Nolasco could be moved in July of 2016, there's another ~$6M saved from your own quoted $70M 2016 veteran base payroll.  Suddenly, you're looking at a potential net team payroll for the entire 2016 season in the $75-$85M range......

 

So yeah, there's going to potentially be a lot of available room for further spending to really go for it in 2016.  Seems like now's the time to start looking over the FA Pool for next year and begin planning accordingly.