Marlins Win Competitive Balance Lottery

MLB held its third competitive balance lottery on Wednesday in New York and 12 teams will receive extra picks on the first day of the 2015 draft, with the Marlins securing the top selection in the Competitive Balance Round A.

The competitive balance lottery, a provision of the Collective Bargaining Agreement that took affect following the 2011 season, will have six selections following both the first and second rounds. The Marlins will be followed by the Rockies, Cardinals, Brewers, Padres and Indians in Comp Round A.

To be eligible for the lottery following the first round, teams had to meet one of two qualifications: reside in one of the 10 smallest markets or rank in the bottom 10 in revenue. Some teams met multiple qualifications, making 13 teams eligible for the first round. Teams that receive revenue-sharing money were eligible for Comp Round B, adding the Mariners and Twins to the pool of teams. Odds of winning a selection were in inverse order of 2013 winning percentage, which gave the Marlins (.383 winning percentage) the highest odds. The Cardinals, a playoff team that tied for the most wins in the majors (97) and lost in the World Series, had the lowest odds but secured the third selection in Comp Round A.

Competitive Balance Lottery
Comp A Comp B
1 Marlins Reds
2 Rockies Athletics
3 Cardinals Mariners
4 Brewers Twins
5 Padres Orioles
6 Indians Diamondbacks

Six of the teams eligible (40 percent) made the playoffs last season and nine teams (60 percent) had at least a .500 winning percentage last year. The 15 teams had a cumulative winning percentage of .508.

While the impact of most of these selections likely won’t felt until draft day next June, these picks could make a short-term impact leading up to next Thursday’s trading deadline. Competitive balance picks can only be traded during the season, as they were in 2012 when the Pirates traded their pick to the Marlins as part of the Gaby Sanchez deal. Miami used that pick to select Arkansas righthander Colby Suggs.

Last July the Astros acquired a Comp Round A pick (No. 37 overall), Josh Hader and L.J. Hoes for Bud Norris, who was a member of the Orioles’ rotation during their playoff push. The Astros used that selection on Virginia outfielder Derek Fisher.

The Pirates dealt righthander Bryan Morris to the Marlins last month for Miami’s Comp Round A pick (No. 39), which Pittsburgh used to select San Diego outfielder Connor Joe, who signed for $207,000 under slot, providing the financial ammunition to give Comp Round B selection Trey Supak (No. 73) a $1 million bonus.

The Marlins have been involved in three trades where Competitive Balance picks have changed hands.

Each selection is barred from being traded for cash and can only be traded once. These picks, which can only be traded during the regular season, are eligible to be dealt up until 5 p.m. EST on the first day of the draft.

All Competitive Balance picks are protected for the next year. In 2013, the Marlins did not reach terms with lefthander Matt Krook (No. 35) and were rewarded the No. 36 pick in the 2014 draft, which Miami used to select prep catcher Blake Anderson.

This is a rare opportunity for teams to acquire extra draft picks, as the more stringent free agent compensation rules under the current CBA have made it difficult for teams to stockpile draft picks. For example, from 2009-2011—the final three drafts under the previous CBA—the teams with the most selections each year averaged seven picks before the second round. No team had more than two first-round picks last month.

With the draft bonus-pool restrictions in place and no team showing a willingness to exceed its bonus pool by more than five percent and forfeit future picks, the importance and value of the Competitive Balance picks comes not just from the potential player but also the pick value. In the 2014 draft, the assigned pick values for the Comp Round A (No. 35-41, including the extra pick for not signing Krook) were between $1.61 million to #1.38 million for an average of $1,484,550 (excluding the money allocated for Krook’s compensation pick). The slot values for the Comp Round B (No. 69-74) ranged from $821,000 to $760,000 for an average of $790,350.

The slot values from every pick in Comp Rounds A and B (excluding Krook’s 2013 pick) have totaled $25,938,750 and signing bonuses have cumulatively been $2,306,050 (8.9 percent) over slot.

The extra financial ammunition from these picks have allowed teams to get creative with their extra picks. More than one-third (36 percent) of the Competitive Balance picks have signed over-slot deals, 18 percent signed at slot and 46 percent signed under slot.

Sean Manaea

Sean Manaea (Photo by Bill Mitchell)

In the first Competitive Balance Round in 2013, the Royals used their extra selection to flex their financial muscle. Kansas City used the first pick of the supplemental round (No. 34) to grab Indiana State lefthander Sean Manaea, a top talent who had an injury-riddled spring but still desired top money. Using the savings from first-rounder (No. 8) Hunter Dozier's under-slot deal, the Royals signed Manaea for $3.55 million, the fifth largest bonus in the draft.

The Rockies used the first pick of Comp Round A (No. 35) last month on Forrest Wall and signed him for $2 million, which tied for the largest bonus after the first round and was over slot by $385,000. The Brewers used the 41st pick to select Jacob Gatewood, who signed for a slot value commensurate the late first round ($1,830,000).

With the last selection of the first day of the draft, the Mariners selected Gareth Morgan at No. 74, signing him for $2 million, which was $1,239,700 over slot, the second-largest over slot deal in total dollar value of the entire draft.

These selections can be lost for signing a free agent who received a qualifying offer from his old team. The Indians lost their Round B pick in 2013 after signing outfielder Michael Bourn in the offseason.

The six Comp Round B selections will be made by the Reds, Athletics, Mariners, Twins, Orioles and Diamondbacks, who had two selections in the same round last month and drafted outfielder Marcus Wilson and infielder Isan Diaz.

The only three teams that were eligible for the lottery that did not receive picks were teams that had low odds because of their winning 2013 seasons—the Pirates (third-lowest odds), Rays (fifth-lowest odds) and Royals (seventh-lowest odds), who picked in Round A the past two years and selected Manaea and Chase Vallot.