Article: Twins, Jorge Polanco Finalizing Contract Extension

[Otto von Ballpark]

MLB contracts can't be truly "front loaded" under the current CBA.

A player under team control must be paid a minimum of 80% of his previous season's salary.

That's just in the 1 years deals of arbitration (and pre-arb?). The team and player can agree to whatever terms they want otherwise.

[Mr. Brooks]

That's just in the 1 years deals of arbitration (and pre-arb?). The team and player can agree to whatever terms they want otherwise.

I don't believe that is true. Hopefully someone can link some clarification.

I remember when some posters were suggesting a 1 or 2 year extension for Mauer, it was pointed out that they'd have to allow him to officially become a free agent before they could offer him less than 80% of his current salary.

[Otto von Ballpark]

 

I don't believe that is true. Hopefully someone can link some clarification.
I remember when some posters were suggesting a 1 or 2 year extension for Mauer, it was pointed out that they'd have to allow him to officially become a free agent before they could offer him less than 80% of his current salary.

I think those posters were mistaken.

 

The Cub Reporter is an excellent resource. Here is where they reference the 80% rule:

 

https://www.thecubreporter.com/book/export/html/4044

 

Note that it is specifically about tendering one-year contracts to pre-arb and arb-eligible players.

 

There's basically no official restriction on extensions or multi-year deals. Mauer could have certainly signed an extension like Todd Helton did in 2010 (Helton was already signed for $19 mil in 2011, but tacked on 2012 and 2013 at $5 mil each).

 

Practical concerns are what usually discourage extreme front-loading (and back-loading too). The luxury tax is calculated based off AAV, so front-loading or back-loading doesn't help teams there. And for the Twins, while the luxury tax isn't a concern, and they may want to spend a few mil today to save a few mil down the line, there are limits to that benefit too -- complicating contract insurance would an obvious one. They may lose money on interest in the long run. Also they probably don't want to risk payroll spiking too high in 2019, etc.

[Mike Sixel]

Interest on one million is a drop in the bucket, when looking at their cost structure and revenue...... Less than it costs to sign a random sixteen year old on July 2.... So hopefully that isn't the deciding factor....

[Otto von Ballpark]

 

Interest on one million is a drop in the bucket, when looking at their cost structure and revenue...... Less than it costs to sign a random sixteen year old on July 2.... So hopefully that isn't the deciding factor....

Well, they front-loaded Polanco's deal by a few million, and Kepler's too, no? So obviously they don't mind that.

 

I was describing why there wouldn't be more extreme front-loading scenarios. That could mean interest on a lot more than $1 million. (And of course, interest is just one factor.)

[Otto von Ballpark]

Here's a current example from MLBTR which again suggests the 80% rule doesn't apply to extensions:

 

https://www.mlbtraderumors.com/2019/02/latest-on-khris-davis-athletics.html

 

 

 

Davis is also willing to take a salary cut to make an extension happen, telling Lee that he would be willing to accept $10MM per year if the A’s were to extend through at least the 2021 season.

This would represent a pretty significant salary reduction for Davis, who is set to earn $16.5MM in 2019 after he and the Athletics avoided arbitration by settling on a contract in Davis’ final year of arb-eligibility.

 

[bird]

 

Interest on one million is a drop in the bucket, when looking at their cost structure and revenue...... Less than it costs to sign a random sixteen year old on July 2.... So hopefully that isn't the deciding factor....

 

 

That's especially true when you consider that some team employee has been following that random sixteen year old and his full time trainer around since that rando was twelve. 

[Mr. Brooks]

I think those posters were mistaken.

 

The Cub Reporter is an excellent resource. Here is where they reference the 80% rule:

 

https://www.thecubreporter.com/book/export/html/4044

 

Note that it is specifically about tendering one-year contracts to pre-arb and arb-eligible players.

 

There's basically no official restriction on extensions or multi-year deals. Mauer could have certainly signed an extension like Todd Helton did in 2010 (Helton was already signed for $19 mil in 2011, but tacked on 2012 and 2013 at $5 mil each).

 

Practical concerns are what usually discourage extreme front-loading (and back-loading too). The luxury tax is calculated based off AAV, so front-loading or back-loading doesn't help teams there. And for the Twins, while the luxury tax isn't a concern, and they may want to spend a few mil today to save a few mil down the line, there are limits to that benefit too -- complicating contract insurance would an obvious one. They may lose money on interest in the long run. Also they probably don't want to risk payroll spiking too high in 2019, etc.

Good info. I stand corrected.