Offseason Journal: Tradespace preparation

On Friday, the Indians declined to make Qualifying Offers to any of their pending free agents (Josh Donaldson was ineligible, as he’d been traded in 2018), including Michael Brantley, but even that wasn’t the most interesting news of the day.

This was:

Olney was also the first to report that the Indians weren’t going to tender a Qualifying Offer to Michael Brantley. The tweet above was followed up the following article at ESPN.com, which I recommend reading in place of the initial tweet. It gives a much better picture of what the Indians are signaling to the public. Assuming of course, that these leaks were intentional (which I believe they are). The Indians generally have been a tight-lipped organization, so something this frank is quite a surprise. But after thinking about, I understand why this leak happened.

This reporting is not designed to let other teams know what the Indians are planning, as Olney mentions that they had already told other teams about their general situation, but to prepare the fans for what otherwise may have been a shocking set of moves. I’m not sure that the Indians mentioned any of the named players specifically in the article, but you don’t have to be an insider to figure out what players are meant by “veterans”. Kluber and Carrasco are as valuable for their contracts as for their outstanding performance (not to mention the paucity of top-tier starting pitchers on the market), and Gomes and Perez are both admired for their defensive skills. Encarnacion and Kipnis are less valuable because of their contracts, but they are still good players. Kipnis in particular may be attractive for a team looking for a short-term fix at second base.

It has been my goal in this series of offseason posts to lay out the details of what the team faces this winter, and it’s nice to get as concrete a confirmation as you can have that my previous guesses are on the right track. I would have loved to have to heard the opposite from the team, that they were going to increase payroll another $20M or so in order to keep Michael Brantley and add at least one back-end reliever, but that doesn’t seem to be in the cards.

The Indians’ 2018 payroll was right in the middle of the pack of MLB teams ($136-137M, depending on which place you look), and it looks like that’s going to be a hard cap, at least for 2019. These aren’t the 00s clubs that routinely finished among the bottom ten teams in the league in payroll, but they aren’t the Yankees, Red Sox, or Dodgers, either. The Indians will be hosting the 2019 All-Star Game, so that should theoretically mean a bump in season tickets (as ASG ticket priority will undoubtedly be tied to them), not to mention revenue from the festivities themselves, but that’s probably only going to be a one-year bump. 2018 attendance actually fell a tiny bit from 2017 (thanks to a lot of early-season homestands), and that probably weighed more heavily in budgeting meetings.

But if the Indians were to shed payroll by trading a core player, they would risk entering into a payroll death spiral, with attendance falling precipitously as fans would see the loss of a familiar star rather than logic behind the move. That is why I think you saw the Olney story yesterday. The timing was such to explain not only the Brantley non-move, but also to prepare the fanbase for the types of moves that the Indians haven’t made since 2013. Over the last several years, the Indians’ roster has been remarkably stable, at least in terms of keeping the core together. They have let free agents go (Carlos Santana, for instance), but otherwise have not had any inclination towards trading a key player. If anything, they have acted more like a big market club in the past couple of years, readily trading top prospects for short and medium-term help(Andrew Miller, Brad Hand, among others), and even signing one of the more high-profile free agents of the 2016-2017 offseason (Edwin Encarnacion).

But eventually, as young players start to get raises, and as you buy more and more players at market rates, and as the revenue doesn’t rise as fast as the payroll does, a team like the Indians were going to have to make some difficult decisions. The reckoning comes quicker for a mid-market team than for a big-market club (coincidentally, the Cubs are in the same situation this winter), but lamenting about this disparity does not give you more money to spend.


A Sidebar: The (new) Qualifying Offer and why I think the Indians passed on Brantley

The 2017-2021 Collective Bargaining Agreement changed the Qualifying Offer process significantly, as its previous incarnation proved a millstone around the necks of many mid-level free agents. No longer do clubs signing a player who rejected a QO have to give up their first draft pick, among other changes that help free agents find new teams. To go into every single detail would bore practically every baseball fan, so I’ll just leave a link to this LGT article for those who live for roster and transactions minutiae. But there is one thing that is worth knowing in order to understand more about the Brantley decision.

  • A team receives a pick after the first round (#31-35) if the they receive revenue sharing (which the Indians do) AND the player receives a contract for at least $50M from another team. If the player receives a contract for less than that from another team, they receive in compensation a pick after the 2nd Competitive Balance Round, which has historically been in the #75-85 range.

So if the Indians thought that Brantley wouldn’t get more than a 3-year, $45M contract, their upside was getting in essence a third-round pick (along with its bonus money allotment). The downside would be Brantley accepting the offer, and painting the team into a corner. The 2018-19 Qualifying Offer is $17.9M, meaning that the 2019 Tribe payroll would already be $5M ahead of what it was in 2018 ($142M vs $137M). Now they do have the ability to cut salary via non-tendering arbitration-eligible players (such as Danny Salazar, who is set to make $5M), but they’d rather not have to do that, as just about everyone left on the roster are players that could help the team. It would also make it that much more difficult to get salary relief in trades (such as Jason Kipnis), as clubs would know the Indians have no room to negotiate.


With all that being said, here’s what the 2019 roster looks like if the Indians stand completely pat:

 

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I’ve replaced the 2018 bWAR actuals with the 2019 Steamer (Fangraphs) projections (fWAR), which is going to be more useful for players who didn’t get much playing time in 2018. For instance, Steamer projects Yandy Diaz to be worth 2.3 wins above replacement. Based on the Steamer projections, the Indians need to add 5.6 wins just to get back to their 2018 totals. And given the state of the AL Central last year, I don’t foresee it being as easy to earn those wins next year. On the salary side, the Indians can add $10-12M in payroll to reach last year’s totals. Given that WAR on the open market was worth $8-9M last year, the Indians aren’t going to be able to improve themselves much in free agency. That is why you are hearing these stories about trading a couple veterans to not only shed payroll, but improve the roster.

 

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