New arbitration/compensation rules

[adambr2]

Ever since the new CBA established new arbitration/FA types/compensation awards/etc. for players, I've had a tough time really following it. The old system was pretty straightforward. Offer a Type A arby and he declines and signs elsewhere, you get a sandwich pick and a 1st round pick if he signs with a top 15 team, 2nd round pick if he signs with a bottom 15, unless they already have a higher ranked free agent in which case you got the pick from the next round, etc. Offer a Type B arby and he declines and signs elsewhere, you get a sandwich pick.

Now I'm hearing all kinds of different things, like for instance, all Type A's are no longer created equal? Some type A's only bring a sandwich pick? Some type B's bring nothing? And you don't need to necessarily offer arbitration to get a pick anymore, but if you do offer arbitration, you have to be willing to offer a one year deal for the average of the highest 125 paid guys in MLB? (about $13M).

Just have a tough time following this, maybe someone could better explain how it works? Maybe using Marcum, for example. Odds are, we won't be willing to offer him $13M for 2013 unless he has an absolute lights out, All-Star, sub 3.00 ERA season. So we don't offer but he stays Type A, do we still get anything, or no?

[RightFieldCoder]

It is just confusing for this year. The CBA wasn't signed until the 11-12 offseason. Teams had been planning during the 11 season to keep using the old rules. They decided to have a complicated rule set for this offseason so no team would get screwed over, but would also slightly follow the new rules.

 

For example, you now need to have a player on your team for the full year to get compensation for losing a player. This means that we wouldn't get anything for K-Rod if we lost him. But when we traded for him in July, we thought we would get at least a Type B pick for "losing" him. It wouldn't be fair to the Brewers (or other teams who made mid season moves) to say "You traded away prospects for a rental and draft picks, but the new rules say no draft picks".

 

Going forward, the compensation rules are simpler than the old Type A:Type B system. There will no longer be any Type As or Type Bs. You are allowed to offer arbitration to any FA player at the average of the top 125 salaries. In 2011 this would be ~$12M. If the player signs elsewhere, you get an extra draft pick. If you offer arbitration for anything less than the average, or if the player spent any part of the year for a different team, you will get nothing for losing the player.

[clancyphile]

It is just confusing for this year. The CBA wasn't signed until the 11-12 offseason. Teams had been planning during the 11 season to keep using the old rules. They decided to have a complicated rule set for this offseason so no team would get screwed over, but would also slightly follow the new rules.

 

For example, you now need to have a player on your team for the full year to get compensation for losing a player. This means that we wouldn't get anything for K-Rod if we lost him. But when we traded for him in July, we thought we would get at least a Type B pick for "losing" him. It wouldn't be fair to the Brewers (or other teams who made mid season moves) to say "You traded away prospects for a rental and draft picks, but the new rules say no draft picks".

 

Going forward, the compensation rules are simpler than the old Type A:Type B system. There will no longer be any Type As or Type Bs. You are allowed to offer arbitration to any FA player at the average of the top 125 salaries. In 2011 this would be ~$12M. If the player signs elsewhere, you get an extra draft pick. If you offer arbitration for anything less than the average, or if the player spent any part of the year for a different team, you will get nothing for losing the player.

This essentially screws over the small-market teams like Milwaukee.

 

A rent-a-player deal for the playoff run, which Milwaukee made in `08 and `11, would be practically impossible. And the money to keep a free agent and at least get something would be daunting. Meanwhile, the big-market teams can make the arby offer OR they can just hang back and pick off the Marcums, Harts, and other players practically at will.

[adambr2]

Yeah, that seems like a lose/lose for both the buying and selling team.

 

The buying team can't get compensation for the rental that they're going to inevitably lose.

 

The selling team loses value on their piece because of the buying team getting no future compensation.

[1992casey]

Part of the confusion exists because there's been no copy of the CBA to inspect at this point. All we've really seen is a summary.

[djoctagone]

i see this as a good thing for teams needing a "rental" player down the stretch that are willing to take on additional payroll. forfeiting teams know that they're not going to be able to get any draft picks for a player worth less than $12 million a year (because they likely wouldn't offer arbitration to that player), so it becomes a means to shed payroll, and usually in such deals, the return is a low-level prospect or two. look no further than what the brewers had to give up to get k-rod from the mets.

 

the acquiring team gets nothing more than a rental for a few months (or more, depending on postseason progress). slight advantage to the acquiring team in that (i believe) they'd still have an exclusive negotiating period with the free agent after the world series, and they certainly would have exclusivity in negotiating a contract extension before the season ended. granted, when a player is just months away from going on the open market, he's likely going to wait to entertain offers from all 30 teams.

 

because the acquiring team only gets a very short-term benefit, the other team should be getting less in a trade. you won't be seeing clubs engaging in many 2-for-1, 3-for-1 and 4-for-1 deals during the season any more. this bodes well for the acquiring team in that they don't need to trade away as valuable of prospect(s) just to get a "rental" player.

[CheezWizHed]

This essentially screws over the small-market teams like Milwaukee.

 

I'm not positive that is true. Basically, it just means that only the best FAs will get compensation. Perhaps a deep pockets team might be able to take a few more chances on a border-line FA (someone that isn't quite worth the $12M), but really its always been like that anyway. That isn't much of a change.

 

I think this is basically going to mean more uncompensated type FA on the market, so teams like the Brewers will have more choices without giving up a pick (which deep pocket teams rarely blink at).

 

I still think an NFL-style compensation should be incorporated so a team's net gain is considered, not the individual signings. Then offering arby or not wouldn't matter.

[owbc]

Are the Brewers even a small market team anymore? The 2012 payroll is going to be in the top 1/2 of the league, possibly in the top 10. Yes, I know the market size is small by the traditional definition, but they act like a mid-market team in the tier right below the teams that can afford Pujols/Fielder. In the last 3-4 years, deadline deals have been much more beneficial for the Brewers than building through compensatory draft picks. The Brewers never got much for CC Sabathia but it didn't matter, they got what they needed out of him and moved on.

[fondybrewfan]

Are the Brewers even a small market team anymore? The 2012 payroll is going to be in the top 1/2 of the league, possibly in the top 10. Yes, I know the market size is small by the traditional definition, but they act like a mid-market team in the tier right below the teams that can afford Pujols/Fielder. In the last 3-4 years, deadline deals have been much more beneficial for the Brewers than building through compensatory draft picks. The Brewers never got much for CC Sabathia but it didn't matter, they got what they needed out of him and moved on.

I tend to agree with you but I don't know that the Brewer's current situation is a permanent one. Basically I question the franchise's ability to sustain 3 million fans year in year out regardless of performance. Sure if they can keep attendance up that high even when they suck I would consider them a mid market team; but they would very quickly turn into a small market team again if they have a couple bad years in a row. Traditionally speaking they are still the definition of a small market team though; isn't Milwaukee the smallest metro market in MLB?

 

 

[RightFieldCoder]

They are 39th. We are smaller than one of our minor league affiliates (#38 is Nashville). We are more than 12x smaller than NY (or 6x if you divide NY evenly between the 2 teams). We are only 76% the size of the next smallest MLB market (#29 KC). We are the definition of small market.

We are doing great in attendance. This is because we sucked so bad and had a lot of high draft picks. What happens when we have a sustained run, don't have top 10 picks every year, and then go back to having losing seasons?

[nate82]

This essentially screws over the small-market teams like Milwaukee.

A rent-a-player deal for the playoff run, which Milwaukee made in `08 and `11, would be practically impossible. And the money to keep a free agent and at least get something would be daunting. Meanwhile, the big-market teams can make the arby offer OR they can just hang back and pick off the Marcums, Harts, and other players practically at will.

 

 

Not really true at all. Not much is going to change in that regard. There are not that many Sabathia trades every year and basically what this does is makes more Greinke and Marcum like trades happen more as teams will be less willing to give up elite talent because they will lose a draft pick compensation if it is only for half of the year. This then in turn makes the trade market more competitive as more teams like Milwaukee are able to get these players earlier on and improving their chances of winning. What if the rules were set in place before the year and the Indians decided to trade Sabathia before the season started and Milwaukee got Sabathia at the beginning of the year. To me that would have been worth more to the Brewers to have Sabathia for a whole year more so than a half of a season. Sabathia for a whole year and you are talking about the Brewers winning the NL Central versus winning the Wild Card.

I believe you are going to see players who are now 1 year away from free agency either traded before the season starts or the team will hold onto them and get the draft picks by offering arbitration. Depending on the player this can be good or bad and along with the salary this could be really good for small market teams as they are probably not going to offer arbitration to the players and getting something is always better than nothing. There will still be KRod trades and the small market teams will do that because the players being given up for these players will probably not amount to anything at all at best these players are AAAA players.

[owbc]

I tend to agree with you but I don't know that the Brewer's current situation is a permanent one. Basically I question the franchise's ability to sustain 3 million fans year in year out regardless of performance. Sure if they can keep attendance up that high even when they suck I would consider them a mid market team; but they would very quickly turn into a small market team again if they have a couple bad years in a row.

I agree, you never know how long the attendance can stay up. It definitely shows why having a nice TV contract locked in can be beneficial.

 

It's hard to define a big market--look at South Florida--almost the entire population of Wisconsin lives within a 1 hour drive of Sun Life Stadium, yet there were routinely about 5,000 people at Marlins games, even when the team was decent. Obviously there are countless reasons why that is the case, but the point is that what really matters is the total number of customers, not the total number of people. The Brewers have won over plenty of loyal fans in the past 5 years and they have encouraged Miller Park to be social destination through the promotion of tailgaiting and the various entertainment options. We don't know yet how many fans will stick around when the team goes through another tough stretch, but I think they will have to be really bad to get back under 2.5 million.

 

One of the most important ways to build a loyal fanbase is by sustained winning. The boom/bust cycle doesn't work as well. Mark A. is a smart guy, he understands that you have to reinvest the additional profits into the team. While we don't know the details of the CBA, I think the Brewers strategy will remain consistent--they will continue to favor adding players through trades/free agency as opposed to through the draft. They have to be smart about it, but it can work. The Brewers are losing the home-grown aspect of their team--it wasn't long ago that 6-7 of the starting 9 were from our minor league system. This year, the home opener could feature only 3 home grown players (pending Braun suspension).

 

Losing role players isn't all that important. But it does hurt to lose a franchise player like Prince Fielder. And if Lawrie becomes a star, that will hurt as well, those kind of players do not come around every day. The star players are the hardest to get and the Brewers will never win a bidding war for them in the open market. It's nice that MLB has arbitration in the first place so that a player like Prince can stay in Milwaukee for 5 years. I think MLB should strive for developing a system where mid-market teams can sustainably keep their star players. Even St. Louis won't be the same without Pujols--and although the Twins kept Mauer, they had to do it at a dangerously high price. In exchange for losing the compensation for Type-B players, there should have been more compensation added for Type-A, or at least for any player signing a deal worth over a certain monetary value like $20 million/year. Make it two 1st round picks, or a signing tax that goes back to the original team, or some other way to discount the price for the mid-market teams. It will be better for baseball in the long run to encourage the stars to stay with their original team.

[Raw Biz]

obsessedwithbrewcrew wrote:

The Brewers are losing the home-grown aspect of their team--it wasn't long ago that 6-7 of the starting 9 were from our minor league system. This year, the home opener could feature only 3 home grown players (pending Braun suspension).

Not to be picky but who are you forgetting? I count Weeks, Lucroy, Hart, Gamel, and Yo if he starts, plus Braun if not suspended. So that would be 5-6.

[owbc]

I was thinking Greinke for the home opener and I forgot Gamel. But if Hart ends up as the starting 1B by mid-season, then it will be 4 except for games that Gallardo pitches.

[CheezWizHed]

could feature only 3 home grown players

 

Why is that a problem anyway? If you are looking from the draft and development perspective, then you need to include K-Rod, Grienke, Marcum, Gomez, and Morgan, since they were all acquired by trading away players in our system.

 

It doesn't really matter if a drafted player makes the team or is traded away to acquire someone to make the team better. They help equally.

[HiAndTight]

could feature only 3 home grown players

 

Why is that a problem anyway? If you are looking from the draft and development perspective, then you need to include K-Rod, Grienke, Marcum, Gomez, and Morgan, since they were all acquired by trading away players in our system.

 

It doesn't really matter if a drafted player makes the team or is traded away to acquire someone to make the team better. They help equally.

 

Right, but they don't cost equally, thereby limiting our ability to spend money elsewhere.

 

 

Which is why this crop of starting pitchers is so incredibly important. We need to re-sign Greinke first and foremost, and then hope that the pitchers we're all familar with can create a #1/2 type, and a couple of viable, league average inning eaters. Greinke/Gallardo-perhaps Peralta/Thorn-whoever/and then two solid pitchers in the 4.25 range. That might be askign a lot, but we've also invested a lot into these guys and finally have quite a few capable of sticking.

 

I think Scarpetta's a wild card here as he's moved up he hasn't really been overwhelmed, and I think is in line for a Peralta like jump this year after having a similar ascension to AA from A+. IF he can cut back on the walks, he could be that #4/5 you pencil in for 6 years.

 

Obviously it's preferable to signing guys like Wolf for 10 million per. Or Marcum for what I can only imagine would be at least 50 million over 4 years(and would end up being awful IMO).

 

 

Lock down the first two, hope you can develop something out of the #3-4-5 spots from within(or a Narveson type pickup setting aside the fact that we will still actually HAVE Narveson for a few more years.

[paul253]

I think another thing to consider is that this will likely lead to fewer compensation picks between the first and second rounds, which I think is good. In the 2011 draft the Pirates drafted first then had to wait for the 61st pick to get their second choice. That's absurd. In the 2012 draft, it looks like there will be 30 compensation picks between the first and second round. Teams shouldn't be getting such high picks for losing guys like Rod Barajas, Mark Ellis, or Jose Molina. I like the idea of limiting the number of compensation picks and giving the worse teams a chance to draft sooner.

 

The way I understand the new rule is that all Type A's are now the same. There is no more arbitration. If you want to receive a compensation pick for them, you have to offer them a specific contract, which is something like the average salary of the highest paid 125 players in baseball. So if the rule were in effect this year, the Brewers would have had to offer Hawkins the same one year contract they would offer Fielder to get picks for him. Obviously the Brewers would not offer Hawkins a one year deal worth $10 million, or whatever that average is, so he'd become a free agent without any compensation. Assuming I am understanding this rule correctly, I like it because it saves the comp picks for the best players. Now players like Barajas, Ellis, and Clint Barmes won't be bringing back compensation picks and pushing back the start of the second round. But the really good players like Fielder, Pujols and Reyes will still bring back some compensation.