Baseball America Draft Chat
John Manuel: Thanks everybody for coming. Don’t forget for more of this, we did a draft podcast Friday with Ted Cahill, JJ Cooper and myself: Jasper Bosman (Leiden, the […]
Big league deals can carry a hefty cost
by Tracy Ringolsby
DENVER--It might not have been the best baseball move, but from a financial aspect, it's hard to knock the Padres' decision to select high school shortstop Matt Bush with the No. 1 pick and pass on righthander Jered Weaver and shortstop Stephen Drew.
The latter two wanted high-priced, big league contracts.
History says giving in to Weaver or Drew would be no sure-fire way to success, something that will be weighed by the decision makers in Anaheim, which used the No. 12 pick on Weaver, and Arizona, which took Drew 15th.
Since the advent of the draft in 1965, only 23 players immediately signed big league contracts. The rewards have been few and far between.
The key to a big league deal is it allows a team to spread out a player's signing bonus. The rules require a team to pay a bonus in full by the end of the next calendar year of signing a player to his first contract, unless the athlete also plays another sport. If that's the case, the bonus can be spread over five years.
With a big league deal, however, a bonus can be hidden as part of the salary spread over a multiyear contract, but there are long-term ramifications.
As good as Cubs righthander Mark Prior might be, he won't be eligible for arbitration until after next season. But in addition to receiving a $4 million signing bonus in 2001 when the Cubs selected him with the second pick, he also was guaranteed a minimum of $6.5 million in salary for his first five years in pro ball.
A salary of $1.6 million for 2003 and $2 million this season and next has increased by $750,000 each year because of a clause in Prior's contract that called for the base salary to be increased $500,000 each time he is chosen for the All-Star Game (as he was in 2003) and $250,000 if he finishes second through fifth in voting for the National League Cy Young Award (he was third last year).
From 1965 through 1997, only six drafted players immediately signed big league contracts. One of those was Bo Jackson, who had added leverage in his negotiations with the Royals in 1986 because he had won the Heisman Trophy and had the option of playing in the NFL.
Of the 12 players who received big league contracts from 1998 through 2001, 10 have made it to the big leagues, including Chad Hutchinson, who appeared in three games with the Cardinals in 2001 in exchange for the $3.4 million St. Louis gave him before he ran to the NFL, where he now is a quarterback for the Dallas Cowboys.
Josh Beckett was a postseason hero for Florida last year, but by mid-June, he had pitched in only 62 games in the majors. By the end of this season, he will have earned $10,334,375 from the Marlins, who originally gave him a three-year, $7 million deal.
Here's the catch: His contract expired after the 2002 season, and major league rules prohibit the Marlins from cutting his salary more than 20 percent from one season to the next and not more than 30 percent during a two-year period.
The rules also require the signing bonus be prorated over the duration of the contract and added to the base salary to determine the figure from which a pay cut can be made.
With a base salary of $1.25 million in 2002 plus a prorated signing bonus portion of $906,250, Beckett had to be paid at least $1.725 million last year and at least $1,509,735 this year, even though he isn't even eligible for arbitration.