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Breaking Down The Harshest MLB Draft Penalties

When Major League Baseball handed down its sanctions punishing the Houston Astros for using technology to steal signs in 2017 and 2018, it included the harshest draft penalties in MLB history.

The Astros will lose their first- and second-round picks in both 2020 and 2021. If the Astros sign a free agent with compensation attached during those years, the punishment will be carried over to later years.

The penalty was worded that way because, in 2017, the Cardinals signed free agent Dexter Fowler almost immediately after they were stripped of their first and second round picks. The move allowed the Cardinals to lose a supplemental (compensatory) first-round pick rather than a first-round pick.

The Astros will have no such loophole. If they sign a free agent and lose their first-round pick in 2020 or 2021, they would simply be pushing part of their penalty to a later year.

Because the Astros received a pick for the loss of free agent Gerrit Cole (who signed with the Yankees), the club will have the No. 72 pick in the 2020 draft, as well as their picks in rounds 3-40.

The slot values for 2020 have not been released yet by MLB, but in 2019, those picks would have led to a total bonus pool of $3.083 million. (The number will be slightly higher this season.) Teams can spend up to 4.9 percent over their allotted pool without incurring draft penalties.

There have only been seven drafts since the current draft system was implemented in 2012 in which a team had less than $3.5 million to spend. To get a sense of the Astros' future, we looked at how those seven drafts worked out.

There were drafts before the 2012 Collective Bargaining Agreement when teams lacked first- and second-round picks, but under the previous system, teams could spent unlimited amounts on signing bonuses, so a club without first- or second-round picks could get around the problem by signing high-priced players who fell to later rounds due to bonus demands. Under the current system, such circumvention is not allowed because teams are strictly limited in how much they can spend.

2017 Cardinals

Spent: $2,248,100
Percentage of Total Draft Pool: 0.9 percent

Why They’re Here: Lost a supplemental first-round pick for signing free agent Dexter Fowler. Lost a first-round pick and second-round pick as the penalty for scouting director Chris Correa’s hacking of the Astros' internal database.

What They Got: Righthander Kodi Whitley, the team’s 27th-round pick, is the only player from the class that ranks in the 2020 Baseball America Prospect Handbook.

Draft Class Summary: This will likely be remembered as one of the worst drafts of the 2010s and has a chance to produce zero players who have an MLB career of any significance.

2016 Cubs

Spent: $2,959,900
Percentage of Total Draft Pool: 1.1 percent

Why They’re Here: Lost first- and second-round picks due to free agent compensation. First pick was their third-round pick (No. 104 overall).

What They Got: No player from the Cubs’ 2016 draft has reached the majors yet. Righthander Tyson Miller, the club’s fourth-round pick, ranks 12th on the Cubs Top 30 Prospect list heading into 2020. Shortstop Zack Short, the club’s 17th-round pick, ranks 28th. Righthander Thomas Hatch, the club’s third-round pick, was traded to the Blue Jays for righthander David Phelps.

Draft Class Summary: This is the worst return the Cubs received from any draft in the 2010s.

2014 Orioles

Spent: $3,410,600
Percentage of Total Draft Pool: 1.5 percent

Why They’re Here: Lost first- and second-round picks due to free agent compensation. First pick was their third-round pick (No. 90 overall).

What They Got: Lefthander John Means had an excellent rookie season in 2019, going 12-11, 3.60 as a starter and finishing second in the AL Rookie of the Year race. Righthander David Hess, lefthander Tanner Scott and utilityman Steve Wilkerson made the majors, although none has had much success yet.

Draft Class Summary: Landing one impact player from a draft without a first- or second-round pick is about as good a result as can be expected.

2013 Angels

Spent: $3,168,200
Percentage of Total Draft Pool: 1.44 percent

Why They’re Here: The Angels did not spend $1 million on any player in the 2013 draft and lost their first-round pick as free-agent compensation.

What They Got: Second-round pick Hunter Green had one of the shortest careers of a prominent pick this decade (he retired after 16.2 innings), but third-round righthander Keynan Middleton had a solid rookie season. His 2018 season was cut short by Tommy John surgery but he returned to the mound in August 2019. Righthander Alan Busenitz (25th round) was traded to the Twins and pitched parts of two years as a low-leverage reliever before being released. Two other players (Michael Hermosillo and Kyle McGowin) have had seen big league time.

Draft Class Summary: The Angels landed one useful reliever who has had injury issues so far.

2013 Nationals

Spent: $3,176,200
Percentage of Total Draft Pool: 1.45 percent

Why They’re Here: After forfeiting their first-round pick due to free-agent compensation, the Nationals did not have a $1 million player in the class. The two players who received more than $500,000 (Jake Johansen and Drew Ward) never reached the majors.

What They Got: Righthander Nick Pivetta (fourth round) was traded to the Phillies for Jonathan Papelbon in 2015. He's spent three seasons in Philadelphia, sandwiching two rough seasons around a solid 2018 campaign. Righthander Austin Voth (fifth round) has been a useful spot starter for the Nationals.

Draft Class Summary: The Nationals signed only six of their picks from rounds 25-40, which explains why only two players from the draft class reached the majors.

2012 Angels

Spent: $2,289,800
Percentage of Total Draft Pool: 1.1 percent

Why They’re Here: Lost first- and second-round picks due to free-agent compensation. First pick was their third-round pick (No. 114 overall).

What They Got: Nine different players made the majors, but none made much impact. The three position players who reached the majors combined for 105 total at-bats. RHP Mike Morin (13th round) is the only of the six pitchers to throw more than 50 innings.

Draft Class Summary: As barren drafts go, this was a pretty good effort, but the Angels received some up-and-down relievers and role players. The entire draft class has produced -3.0 bWAR so far.

2012 Tigers

Spent: $2,477,800
Percentage of Total Draft Pool: 1.52 percent

Why They’re Here: The Tigers first pick was in the second round at No. 91 (there were many more compensatory picks in 2012 due to the final year of the old free-agent compensation system).

What They Got: Righthander Jake Thompson (second round) was traded to the Rangers in a 2014 deal for Joakim Soria. He pitched sporadically for the Phillies (after being traded again) from 2016-2018. Righthander Drew VerHagen has thrown 199 innings for the Tigers over six seasons, posting a 5.11 ERA and a 4.76 FIP. Second baseman Devon Travis was traded to the Blue Jays for Anthony Gose. Travis had an excellent season and a half with the Blue Jays before injuries sidetracked him. He’s posted a 6.6 bWAR over four seasons.

Draft Class Summary: The Tigers had more to spend as a percentage of the total draft pool than most of the teams in this study, and they made it count. Travis is one of the better players picked by a team with so little money to spend.


Top 10 Draft Bonuses For All 30 Franchises

A team-by-team listing of top 10 draft bonuses for all 30 franchises.

In summary, the Astros face significant hurdles in restocking a thinning farm system. The club will have back-to-back drafts where they will have to be extremely astute at bargain hunting. While there have been a few useful players plucked from these low-cost drafts (John Means, Devon Travis, Keynan Middleton and Austin Voth), the results of these draft classes have been generally poor.

Houston showed the ability to turn late-round, low-cost picks into useful players last decade, but the club’s scouting and player development will be taxed to overcome a significant hurdle the next two draft classes.

The History Of Draft Pick Penalties

The penalties handed to the Astros means that the 2020 and 2021 drafts will be the third and fourth of the past five drafts where a team forfeited one or more draft picks for rules violations.

The Cardinals were stripped of their first and second round picks in the 2017 draft for Correa's hacking. The Braves forfeited their third-round pick in the 2018 draft for violating signing rules as part of a wide-sweeping investigation into the team’s wrongdoing.

This run of draft pick penalties is extremely unusual. No team lost a draft pick due to malfeasance from 1981-2017. But in the first years of free agency in the late 1970s, there was a similar run of draft pick penalties.

With the help of Allan Simpson’s indispensable Baseball America’s Ultimate Draft Book, here is a look at the previous draft penalties.

In 1977 the Braves were found to have contacted soon-to-be free agent Gary Matthews while he was still playing for the Giants. The penalty was the forfeiture of their first-round picks in the January and June phases of the draft. The Braves went to court and the penalty was eventually reduced to just the January pick (which was the less talented of the two drafts).

In 1979, the Angels, picking fourth in the January draft, worked to try to land Southern California star pitcher Bill Bordley. Bordley had made it clear he wanted to play on the West Coast. The Reds ended up picking Bordley with the third pick and he refused to sign. MLB’s executive council vetoed a trade in which the Angels would have sent Dickie Thon and $75,000 to the Reds for Bordley.

Commissioner Bowie Kuhn ended up voiding the Reds pick of Bordley. The Angels were found to have tampered with Bordley and as punishment, the Angels were forced to give the Reds three future draft picks. The Reds received the Angels second round pick in the 1979 June regular phase as well as the Angels first and second round picks in the 1979 June secondary draft. The Reds drafted LHP Bob Buchanan with the June regular draft compensation and RHP’s Mark Pederson and Robert Elliott with the secondary phase picks.

Kuhn then set up a special lottery for Bordley. The Giants won his rights and signed him to a $200,000 bonus (then a draft era bonus record for an amateur). He had elbow problems soon thereafter and pitched only eight games in the majors.

In 1980, the Yankees wanted to sign Billy Cannon Jr., the son of 1959 Heisman Trophy winner Billy Cannon. The younger Cannon was a two-sport star who was projected as a first-round pick. The Yankees did not have a first- or second-round pick that year.

As such, Cannon threw out a massive number ($250,000) to forgo college, which would have been a draft bonus record. He went unpicked until the Yankees drafted him in the third round. Four teams quickly accused the Yankees of tampering and Kuhn soon voided the pick, saying that a telegram from Cannon's father to clubs stating that his son would not play professional baseball and go to college instead was misleading. Kuhn ruled Cannon would never be allowed to sign with the Yankees. His rights were awarded to the Indians in another special lottery. He opted to go to Texas A&M instead. As a linebacker he became a first-round pick of the Dallas Cowboys in 1984 but played only one season before suffering a career-ending neck injury.

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