Don't Overlook the Value of Twins' Surprising Savings on Arbitration-Eligible Players

[Greggory Masterson]

The Twins appear to have saved money in arbitration this offseason, and although it only came about $2 million under projections, that savings carries extra meaning for a team up to its waist in mud.

Image courtesy of © Matt Blewett-Imagn Images

After three years of service time (or when just shy of that threshold by a month or so), MLB players can automatically start making more than their standard minimum salary, until they reach free agency after six years of service time. If the team and player cannot come to an agreement on what their salary will be, they can appear before an arbitration panel. By and large, though, the team and arbitration-eligible player can come to some sort of agreement.

The Twins had 13 players eligible for arbitration this offseason. That’s half of their roster. Although these players tend to earn less than equally skilled players on guaranteed contracts, the team at least knows how much those guaranteed contracts will cost them. The Twins gladly pay Joe Ryan and Bailey Ober less than they’re paying Chris Paddack, but at least they’ve known for years what Paddack will cost in 2025. For Ryan and Ober, they just learned that last week.

Five of the 13 arbitration-eligible player cases were determined early in the offseason. Alex Kirilloff retired, so we don’t have to worry about that. Jorge Alcalá had a team option for 2025 that was exercised, skipping his arbitration eligibility. Justin Topa, Michael Tonkin, and Brock Stewart all agreed to deals on the deadline to tender contracts (i.e., anyone who wasn’t non-tendered by that day has to be paid), in a series of deals that reeked of “Take this offer or find somewhere else to play on your own.”

MLB Trade Rumors (MLBTR) provides salary estimates for arbitration-eligible players, and these estimates are generally held as the industry standard for those among us who don’t have access to teams’ internal projections. The deals for Alcalá, Topa, Tonkin, and Stewart combined to come in about $600,000 below the estimates, which is a good start but not abnormal for take-it-or-leave-it early final offers.

The other eight contracts were announced by a combination of Darren Wolfson and Dan Hayes on Twitter on Jan. 9, the deadline to agree to terms and avoid having to submit figures for an eventual arbitration hearing. MLBTR's estimates were largely accurate. The site’s biggest underestimation among Twins was Jhoan Durán’s, which was settled at $4.125 million, about $400,000 above their $3.7 million estimate.

Overall, though, the site trended toward overestimating Twins salaries, with Ryan, Ober, and Royce Lewis’s final numbers coming in between $600,000 and $800,000 below the projections. In total, the Twins’ arbitration-eligible players (excluding Alcalá, given the player option) earned approximately $2.4 million less than MLBTR foretold.

It’s totally possible that this number was right in line with what the Twins’ front office had projected internally, but let’s assume that their projections were close to the $33.3 million total that MLBTR had. In truth, there’s reason to believe that, at least from a spending perspective, the Twins took a more conservative approach and planned around more than that figure, so as not to bite off more than they could chew ahead of 2025’s payroll limitations.

Now that these salaries are set, the Twins benefit in two ways. First, there’s cost certainty. They no longer need to fumble around with rough estimates of their current payroll. Public estimates have ranged from $132 to $144 million this offseason as to where the payroll would stand without any talent being traded away. Now, though, they have a number. There is no sliding scale. There’s another easily imagined reality in which the arbitration-eligible players made a collective $5 million more than they did in this reality. They no longer have to guess.

No longer having to guess means that they can start making real plans for appropriate payroll. Honestly, there’s a chance that some of the team’s inactivity this offseason is because they were waiting to know how much nearly a third of their current roster, making up about a quarter of their committed salaries, will be paid. If they indeed plan on moving Paddack, for instance, they would be more likely to seek deals to move his entire salary if their projected Opening Day payroll clocked in at $142 million. If the projected Opening Day payroll was $132 million, they would probably be more open to retaining some of his contract, which means sending cash along in a deal but getting a better player back. But until the numbers were finalized, they couldn’t know that.

The second benefit is the obvious one: they have about $2.5 million available that they were not projected to. In a typical offseason, that’s a negligible amount. But for a team that still seems to be above the Opening Day payroll people have assumed they are aiming to get to, that goes a long way.

Although some may speculate that the Twins are not in a mad dash to reduce payroll, it’s been a safe assumption to expect Opening Day payroll to be around $130 million. After the Twins’ newly settled contracts, their projected Opening Day payroll is about $134 million, according to Cot’s Contracts. That number would have been about $136.5 million using MLTR’s projections. It could have been higher than that, had negotiation not gone the team’s way.

Let’s use Paddack yet again. He’s making $7.5 million this year, no matter who he’s playing for or who’s paying him. At this new figure, offloading his entire contract, or even part of it, can be enough to get the Twins under their necessary threshold. If the Twins retained, say, $2 million of his contract in a trade, they’re still in a better financial position than they would have been if they traded his whole contract but owed the MLBTR projections.

Suddenly, there’s more breathing room. Let’s say they can still move all of Paddack’s salary, as they always planned to. Well, now, they have $2.4 million more than they had planned. Again, that’s not world-changing money, but if they have one big fish they’re trying to reel in this offseason, an extra couple million dollars might make it possible. Furthermore, Randal Grichuk made $2 million last season. Donovan Solano made the same the year prior, and only signed for $3.5 million with the Mariners on Monday. That money under projections can be the difference between an MLB veteran sitting on the bench over Michael Helman right now (assuming the Twins sign the right two-million-dollar guy, of course).

It may not seem like big news, but these figures represent some of the most meaningful news the Twins have gotten or produced this offseason. It’s a low bar, sure, but it means a ton this offseason.

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[tony&rodney]

The biggest benefit will be that there is a lower base when increases are figured next year. The Twins may still pull of a couple of tranactions. Hays would be a decent addition to the roster. Still, I think the Twins are not adding via free agents. 

[Parfigliano]

History says in Paddack's case it would be more accurate to say he's making $7.5 mil no matter who he's not playing for.

[NYCTK]

woo

I love to cheer for a baseball team to save money on the margins in arbitration. 

[jmlease1]

It's depressing that some of the best news we've had all off-season is that management chiseled $2.5M out of the players in avoiding arbitration. Blegh.

I guess it's better than needing to dump salary, but yuck. I hope new ownership a) does better in raising revenue without screwing fans on tickets, b) invests in the team that increases so nicely in value year over year whether they're good or not, and c) gives a damn about the on-field product at least as much as their cash flow. Pohlads can go count their dollars in their mansions and stay out of baseball.

[old nurse]

Grichuk turned down a 6 million option. I would think that he is expecting to get a better offer than that

[Greggory Masterson]

15 minutes ago, old nurse said:

Grichuk turned down a 6 million option. I would think that he is expecting to get a better offer than that

Correct—I didn’t mean Grichuk himself; I was just talking about that class of players, trusting that the Twins choose correctly

[Doctor Gast]

Like a few have mentioned, it's pretty sad that we can get excited about Pohlads saving $2.5M on player salaries so we don't have to take a beating on a Castro or Vazquez trade. I also agree with T&R that there shouldn't be any big FA splash. IMO, we don't need to. With a couple of meaningful trades, we'd be in good shape.

[bean5302]

I'm much more concerned about the new owners being able to repair relationships with the players after a few core team members got much less than expected.

Wonder if the front office will once again win the coveted "We beat our players down in arbitration belt!"

[chpettit19]

51 minutes ago, bean5302 said:

I'm much more concerned about the new owners being able to repair relationships with the players after a few core team members got much less than expected.

Wonder if the front office will once again win the coveted "We beat our players down in arbitration belt!"

Every team does this. If this broke their relationship with a player the relationship was already in quite bad shape. This isn't new practice or a Twins only thing. This is how arbitration works. For every team. Not sure why the new owners, or even the current front office, should have any relationship repairing to do. Every player knowns how arbitration works and knows the team is going to go after the lowest possible dollar amount. If they were surprised by that that's on them and their agents. If they didn't like the number they signed at they shouldn't have signed at that deal. This is just how the MLB system works. It shouldn't effect the relationship with any player.

[Fire Dan Gladden]

I saw this headline and thought it was a Randball Stu article...

[bean5302]

2 hours ago, chpettit19 said:

Every team does this. If this broke their relationship with a player the relationship was already in quite bad shape. This isn't new practice or a Twins only thing. This is how arbitration works. For every team. Not sure why the new owners, or even the current front office, should have any relationship repairing to do. Every player knowns how arbitration works and knows the team is going to go after the lowest possible dollar amount. If they were surprised by that that's on them and their agents. If they didn't like the number they signed at they shouldn't have signed at that deal. This is just how the MLB system works. It shouldn't effect the relationship with any player.

Beating the players down has led to relationship problems between players and teams in the past. Manipulating service time, arbitration hearings, etc have all contributed to player/team relationship stress. It doesn't matter if every team does it. It matters what team does it to what player. 

[jmlease1]

3 hours ago, bean5302 said:

I'm much more concerned about the new owners being able to repair relationships with the players after a few core team members got much less than expected.

Wonder if the front office will once again win the coveted "We beat our players down in arbitration belt!"

This is why they settled before actually going to arbitration, so they wouldn't risk fracturing a relationship. It's likely part of why the Twins parted ways with Berrios after actually going through arbitration, knowing that he may have been holding the team's salary victory against them as it related to free agency. In these cases, the team settled with the players directly on numbers the players accepted, rather than them being forced down their throat by an arbitrator after going through the process of hearing the team tell the arbitrator why the player actually sucked a lot more.

They never actually got to arbitration. This was negotiated.

[Major League Ready]

2 hours ago, chpettit19 said:

Every team does this. If this broke their relationship with a player the relationship was already in quite bad shape. This isn't new practice or a Twins only thing. This is how arbitration works. For every team. Not sure why the new owners, or even the current front office, should have any relationship repairing to do. Every player knowns how arbitration works and knows the team is going to go after the lowest possible dollar amount. If they were surprised by that that's on them and their agents. If they didn't like the number they signed at they shouldn't have signed at that deal. This is just how the MLB system works. It shouldn't effect the relationship with any player.

I completely agree but there are always going to be fans insisting that players don't understand it's a business.   I seem to recall lots of posters saying that Buxton would never sign an extension.   Some even were critical that they would not give him $150M+ guarantee.  Now people are complaining about him getting $15M/year when he has produced quite well in 3 or the past 4 years.

Now we are complaining that they avoided arbitration with every single player.  

[chpettit19]

1 hour ago, bean5302 said:

Beating the players down has led to relationship problems between players and teams in the past. Manipulating service time, arbitration hearings, etc have all contributed to player/team relationship stress. It doesn't matter if every team does it. It matters what team does it to what player. 

Arbitration hearings have lead to a couple players being vocal about what their teams said. That's what's upset the players. The things the team has said about them in hearings. Otherwise, it's just the system in general. It's not the Twins fault these specific players agreed to sign these deals. There's no reason at all to believe there's broken relationships that need to be repaired.

Royce Lewis has never played more than 82 games in a season at the MLB level. The majority of his service time has come on the IL. His arb number was always going to be low because he doesn't have the counting numbers and his numbers in his largest sample size season ended up being pedestrian. Scott Boras isn't some first time agent who didn't know what to expect in arbitration for Royce. He has a whole team of people who put together data and info. If Royce signed that deal it's because the biggest agent in baseball told him it was a good idea. And Royce was very likely well aware that the contract was likely to come in around those general numbers. He was the one the public predictions were the furthest off on and it makes sense.

The Twins shouldn't be in the business of handing out higher 1st year arb deals than they have to just because a player may want more. Welcome to negotiations in pro sports. Pete Alonso is getting a hard lesson in it right now. Teams will never pay more than they have to and every player knows that. It's a business. If the new owners plan to come in and hand out contracts that make players happy instead of what's best for the team I'd rather we find different new owners. Players should fight for as much as they should get but the team shouldn't be handing out more than they have to. That's just bad for team building. 

Every team does it to every arb eligible player. There's no "which team, which player." They all offer every player the lowest contract they think they could win in arbitration with and then negotiate from there. 

[Kirby Killebrew]

Spotrac has our total 40-man roster commitment (plus dead money) at $137.7 million.  I think that's our number to work from.

https://www.spotrac.com/mlb/minnesota-twins/overview/_/year/2025

[old nurse]

4 hours ago, Greggory Masterson said:

Correct—I didn’t mean Grichuk himself; I was just talking about that class of players, trusting that the Twins choose correctly

That class of player is a player who is a corner outfielder, can play some center, was above average, hit well, declined, went to Colorado, hit really well, got traded and crater so he came cheaply to Arizona.. Also hit right handed. Good luck finding that scenario

[Greggory Masterson]

34 minutes ago, old nurse said:

That class of player is a player who is a corner outfielder, can play some center, was above average, hit well, declined, went to Colorado, hit really well, got traded and crater so he came cheaply to Arizona.. Also hit right handed. Good luck finding that scenario

I think you missed the next sentence talking about Donovan Solano, unless he's now a corner outfielder who can play some center and played bad in Colorado. Clearly I'm talking about a useful bench role player who makes around 2M as a free agent, not Randal Grichuk specifically.

[old nurse]

9 minutes ago, Greggory Masterson said:

I think you missed the next sentence talking about Donovan Solano, unless he's now a corner outfielder who can play some center and played bad in Colorado. Clearly I'm talking about a useful bench role player who makes around 2M as a free agent, not Randal Grichuk specifically.

Donovan Soloano types are now 3.5 million dollars players, not 2. 

[Greggory Masterson]

5 minutes ago, old nurse said:

Donovan Soloano types are now 3.5 million dollars players, not 2. 

I didn't realize you were messing with me. My bad

7 hours ago, Greggory Masterson said:

Donovan Solano made the same the year prior ... That money under projections can be the difference between an MLB veteran sitting on the bench over Michael Helman right now (assuming the Twins sign the right two-million-dollar guy, of course).

 

 

[Guest]

The "saved" $2 million can now be used to pay the FOUR assistant general managers.  Good grief.  Why does a team need four AGM to make minor league signings?

[Linus]

How low have we sunk that we need to get excited about $2 million saved in payroll.

[tony&rodney]

I can only add that the Twins are not focused or concerned about their current payroll. Business as usual means there is always the chance of a trade or two but the interest in adding significant payroll or bench players should not be expected. 

[LambchoP]

Could this go down as the most boring twins off-season of all-time?

[NYCTK]

9 minutes ago, LambchoP said:

Could this go down as the most boring twins off-season of all-time?

All that matters is the sale of the team. We've known that since the announcement they were looking to sell. 

If they actually sell the team, the offseason is the best in my lifetime.