Thursday, October 25, 2012

The State of the Yankees Budget Revisited

Recently, my brother wrote a very well researched and stringently fact checked article about the state of the Yankees budget.  As we all know, the Yankees are trying to get their payroll under $189 million by 2014.  This year the payroll sat at just under $210 million.  The problem is that the Yankees were at $210 million with a lot of cost controlled contracts.  For example, Swisher made $10.25 million, Granderson made $10 million, Kuroda made $10 million, Pettitte made $2.5 million, and Ibanez made $1.1 million none of which will be coming back next year without a pay increase, or in the case of Swisher, probably won't be coming back at all leaving a hole in right field with no immediate farm options to replace him.  Despite the pay increases, there are a number of contracts coming off the books:

Mariano Rivera - $15 million
Nick Swisher - $10.25 million
Hiroki Kuroda - $10 million
Russell Martin - $7.5 million
Freddy Garcia - $4 million
Pedro Feliciano - $3.25 million
Andy Pettitte - $2.5 million
Andruw Jones - $2 million
Raul Ibanez - $1.1 million
Eric Chavez - $0.9 million
David Aardsma - $0.5 million

Some contracts that call for a pay reduction for next season:

Alex Rodriguez - $1 million

And some contracts that God willing, will be opted out of:

Rafael Soriano - $14 million

Assuming all of these things come to pass the Yankees will have $72 million coming off the books.  However, this is offset by some pay raises:

Derek Jeter: $1 million raise
Robinson Cano: $1 million raise
Curtis Granderson: $5 million raise

And of course 7 or so arbitration eligible players who made a combined $14.2 million this year, and will get a pay bump for next season.  The Yankees can limit how much goes to arbitration eligible players by dropping some under performers (Casey McGehee made $2.5 million this season, and would likely get a pay increase for next year.  There are plenty more infield options available for cheaper!) 

Further more, all those contracts coming off the books leaves the Yankees with a bunch of holes in their 25 man roster.  The Yankees will be on the market for a right fielder, a catcher, 2 starters, a closer, possibly a setup man, a designated hitter, and possibly a couple of bench players or relievers.

So in short, there is about $72 million due to come off the books (assuming Soriano opts out), $7 million of that will go to pay raises to Jeter, Cano, and Granderson, and lets say an additional $5 million goes to settling arbitration contracts.  That leaves the Yankees with $60 million, but the Yankees won't want to spend all of it because they're trying to reduce payroll.  So if they pocket $8 million, and invest $52 million back into the team, what will that look like?  Can you get 2 starters, a catcher, a right fielder, a closer, and a DH for that much?  And if we rely on signing lots of 1 year contracts to fill these spots, what do we do in 2014 when we have to be under $189 million, and have to fill all these holes again?

Back on March 1st, Hal Steinbrenner explained how the Yankees would get under $189 for 2014:

“I’m a finance geek,” he said. “I guess I always have been. That’s my background. Budgets matter, and balance sheets matter. I just feel that if you do well on the player-development side and you have a good farm system, you don’t need a $220 million payroll. You don’t. You can field every bit as good a team with young talent.”  (NY Times)

Yes, that amazing Yankee farm system will field us every bit as good a team with young cost controlled talent. 

5 comments:

Rich Mahogany said...

The earlier points about Rivera's salary are well taken. I don't see him getting as much as $10 million when there has to be a real question whether he is capable of pitching a full season and postseason's worth of work. While he is a one of a kind player, he is at an age where a career can end in the blink of an eye, just like his 2012 season did. I'm sure the Yankees will work something out as no team is going to pay him more.

Martin should be brought back for a two or three-year deal for something like $7 million/year. There is nothing better out there and he was more productive than his average suggests. The pitchers seemed to like working with him.

Since Swisher is almost definitely gone, the team really needs Ichiro to come back on a reasonable one-year deal and a healthy year from Gardner. Otherwise I have no idea what they will do. Giving more playing time to Ibanez and/or Jones isn't an option. Hamilton is probably out of the question since the team won't even spend on Swisher.

If Kuroda and Pettitte will take another one-year deal, snap them up. If either of those guys doesn't come back, I'm at a loss again.

I found it odd that the Yankees cut Branyan and Cust, the veteran power hitters they were keeping around in AAA. If those guys were still signed, maybe one of them could have been a cheap DH/bench option for 2013. Instead the Yankees will probably use the DH to Rest Aging Players.

So in short, I have no idea how to answer your questions.

Rob B said...

Reports are that Ichiro wants to return to the Yankees, and money is not a problem. That sounds promising. He could easily slide into right. Of course, that would me an entire starting line up of lefties in the outfield. So what righty outfielders do we get for the bench?

If Mo comes back (reports are he's seriously considering retirement), I'd like to see him on an incentive laden contract; sort of like what Andy had before he "retired". I know the Yankees don't do those kinds of contracts much...but they should, especially with older players.

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Providing more enjoying a chance to Ibanez and/or Jackson isn't an choice. Hamilton is probably out of the query since the group won't even invest on Swisher.

Fernando Alejandro said...

If Mo doesn't come back, it makes it even more difficult, because then we need a closer, and that market will be tough. We'd have to overpay for Soriano again.

per head service said...

wow after reading and staring at the different contracts, Mariano Rivera earns a lot more than his co team partners, it is a big difference!