Behind the Minnesota Twins’ Low 2024 Payroll is a Big 2025 Increase

Following what felt like the dawn of a new era for Twins baseball, many fans have felt that hype shot through the heart with disappointment, as the team has decreased its payroll in response to broadcast woes. However, as President Dave St. Peter made clear to Evan Drellich in The Athletic, the choice to make that change was only partially due to that uncertainty. 

I am not here to run flack for the organization. However, there are two financial cliffs awaiting the Twins in 2025 that are interesting to look at. The first is that the broadcast nightmare is not over. With a one-year deal with Bally, the Twins will be back on the market next year, with more or less the same set of available partners. Even if Rob Manfred creates an MLB streaming product to fans without blackouts, it will likely fall short of generating the significant cable money the Twins earned in working with Diamond Sports Holdings--barring some kind of miraculous collaboration with several big-market teams, who are not contracted with DSH or Bally and don't have much incentive to join the cabal.

The other issue is more interesting: The Twins will, by nature, have to run a highly inflated payroll in 2025 due to their current contracts and players entering arbitration. If the Twins simply ran back the exact same team next year, they will be adding $20 to $25 million in payroll over what they currently have. Let’s break down the details

Free Agent Contracts with Increases: Carlos Correa, Pablo López, Chris Paddack, Randy Dobnak
Estimated Increase: $23.25 Million
Although the Twins have scored some of the most team-friendly extensions in the game, they have also designed them in a way where some years pay better than others. Next year is when some real money will be due. Correa’s gargantuan contract hits it peak, with a $4-million increase to $37.5 million. López will finally get to the meaty part of his extension, with a $13.5 million increase to $21.75 million (still a team-friendly deal compared to the open market, where Sonny Gray will be earning $25 million). Paddack signed an extension following his Tommy John surgery that essentially re-designed his arbitration years. Whether or not he becomes a reliable starter, the Twins have him for another year at $7.5 million--a $5-million increase from his 2024 salary. Dobnak’s deal also sees a guaranteed increase of $750,000 next year.

Arbitration 1 Players: Joe Ryan, Bailey Ober, Griffin Jax, Jhoan Durán, Royce Lewis, Trevor Larnach
Estimated Increase: $10 Million
The Twins have done well building a deep, team-controlled core. But that core is soon to be due real money, as they begin their arbitration years. Although arbitration is based on previous year performance, there are certain bands of money where we can at least put generalized estimates on what might be needed for 2025. If Ryan and Ober turn into mid-rotation starters, they will each see increases of at least $2 million each. The same could be said for a batting phenom like Lewis. Durán and Jax will be more difficult to estimate, but both are likely due an extra million or more. Larnach is the odd man out, and will be fighting both in Spring Training and all season to retain his roster spot.

Arbitration 2 and 3 Players: Ryan Jeffers, Willi Castro, Josh Staumont, Justin Topa, Steven Okert, Alex Kirilloff
Estimated Increase: $9 Million
This group of players have less chance of breaking the bank, though Jeffers is a notable name here. Just this season, Dodgers catcher Will Smith set a new record for Arbitration 2 as a catcher, with $8.55 Million. Jeffers likely won’t match the All-Star, but another good season should net him a few extra million. Castro is set for $3.3 million this season, and will probably only earn a small increase for 2025. All the bullpen arms remain question marks in how much they might see, or whether the Twins might keep them. Like Larnach, Kirilloff will need to prove himself viable on the field before other batters from the minors may come knocking for his spot.

Option Deals: Kyle Farmer, Jay Jackson, Jorge Alcalá
Estimated Increase: $2.61 Million
The Twins also have three options on their various spare parts. In order to avoid a messy arbitration, the organization and Farmer agreed on adding a mutual option for 2025 that would bump his salary a small but notable $200,000. With the arrival of Brooks Lee, the Twins may once again try and find a trade market for the backup infielder. Jackson also arrives in Minnesota with a team option at $3 million for next year. If he turns out to be as good as advertised, the Twins may add the additional $1.7 million to keep a strong arm. Finally, Alcalá and the Twins agreed to a mutual option for $1.5 million. Alcalá will likely break his injury track record to get the Twins to keep that money on the table.

Money Coming Off the Books: Max Kepler, Carlos Santana, Anthony DeSclafani, Caleb Thielbar
Estimated Decrease: $22.25 Million
Of course, players reaching free agency means the Twins will shed some payroll, as well. Kepler’s money remains the most significant, as the team will get out from under his team-friendly $10 million contract. The others are quite small, but add up in the aggregate. However, this all remains an issue for the Twins: they will be losing a right fielder, a first baseman, a starting pitcher, and a solid left-handed reliever. The team will almost certainly spend all season evaluating their prospects, to see if any of them can act as legitimate replacements. But if there are holes, they will certainly have to take some of this money and convert it into new spending to remain competitive.

Although things could shake out in several ways, it is almost certain that the Twins will see an additional $20 million added to their payroll next season, and that's before making any external additions. That's why, despite their unexpectedly non-calamitous short-term TV deal, they've been reluctant to commit to a free agent who could end up being on the books for another $20 million in 2025. It hardly excuses the team for pocketing the money, but the Twins will need to think creatively as this young team ages into big money--whether they like it or not.