Why The Brewers Are Acquiring International Slot Values

The Brewers have begun the process of acquiring more additional pool money to try to fit Dominican infielder Gilbert Lara, the No. 5 international prospect for July 2, into their bonus pool without paying any penalties.

The Athletics announced Monday that they acquired 24-year-old low Class A righthander Rodolfo Fernandez from the Brewers in exchange for Oakland’s No. 2 bonus slot, the No. 57 overall slot with a value of $339,000. Fernandez is an organizational reliever from Cuba who didn’t make the Top 30 in the Prospect Handbook entering the season in the second-worst farm system in baseball, but more important is why Milwaukee needs these slot values.

Since the 2014-15 signing period opened, the Brewers haven’t signed any international players. They are extremely likely to sign Lara, but it’s expected that their agreement with him and his representatives (Enrique Soto and Jaime Ramos) is in the neighborhood of $3 million. The Brewers’ originally allocated bonus pool is $2,611,800. However, teams are allowed to acquire an additional 50 percent of their original bonus pool, which means Milwaukee can enhance its bonus pool as high as $3,917,700.

There are two important factors. One is that teams can’t just trade for $1 million or $1.5 million in pool money—they have to acquire other teams’ slot values. Every team’s bonus pool is comprised of four slot values, plus a base allocation of $700,000. If this seems completely arbitrary, you’re right—MLB created this system to try to ease its way into an international draft by this year, but that never happened, so we have this system instead.

The other important factor is this: Once a team has spent its available signing bonus pool, it can no longer acquire additional slot values. So if a team has a $2.6 million bonus pool and signs a player for $3 million on July 2, it can’t acquire another $1 million in slot values on July 15 to stay under its pool. At that point, a team would already be in the maximum penalty range of more than 15 percent beyond its bonus pool, which means a 100 percent tax on the pool overage and the inability to sign a player for more than $300,000 in the next two signing periods.

For the Brewers, their bonus pool now stands at $2,950,800. The Brewers are probably looking to acquire additional slot values, not just so they can sign Lara but so they can sign additional players as well. Teams can sign unlimited players for $10,000 or less that won’t count against their pools, but those six exemptions of $50,000 or less are gone this year, a clever way for MLB to wipe away $9 million from the bonus pools while still being able to technically claim that bonus pools rose from last year.

Lara hasn’t signed a contract with the Brewers yet. But you can count on him doing so, as expected, once Milwaukee has acquired sufficient international slot values to avoid paying the maximum penalties.