Results tagged ‘ CBA ’

The new CBA — what the top 10 picks are worth

I’m getting more and more details about how the new CBA will work in terms of the Draft and international signings and I promise to share them all with you as the picture becomes more clear. Some of that will come in the form of stories and I’ll use the B3 space for tidbits here and there. And believe me, there’s a lot. Truthfully, no one knows just yet how this will impact anything with the Draft and might not until everyone goes through it a time or two. Yes, there will be some bumps, especially with the market correction in the first year, but I think it too soon to presume certain teams will be ruined/destroyed/greatly hampered by this new system.

Anyway, one bit of info I wanted to pass along now.  Those of you following this saga know that the way it will be set up will be with each team having  a certain “Signing Bonus Pool” — an amount of money a team is allowed to spend in the Draft without being charged a tax or the forfeiture of draft pick(s). Teams picking at the top of the Draft will have a larger pool. In 2012, the Astros will have the largest pool at $11.5 million. That figure comes from adding up the values of every pick they will have, as of now, in rounds 1-10.

I have been able to obtain the values assigned to the top 10 picks in the Draft. It doesn’t give the complete picture — I hope to get more information soon — but you can see how MLB valued the top of the Draft:

1 — $7.2 million
2 — $6.2 million
3 — $5.2 million
4 — $4.2
5 — $3.5
6 — $3.25
7 — $3
8 — $2.9
9 — $2.8
10 — $2.7

This doesn’t mean a team picking No. 4, for example, can’t go over $4.2 million to sign that pick, but it all goes toward that aggregate pool.  As a comparison, take a look at what the Nos. 1-10 picks got in 2011. Keep in mind, some of these were Major League deals, which are no longer allowed. But in any deal — even a two-sport contract spread over five years — would be included in total against that year’s pool.

1 — Gerrit Cole: $8 million
2 — Danny Hultzen: $6.35
3 — Trevor Bauer: $3.4
4 — Dylan Bundy: $4
5 — Bubba Starling: $7.5
6 — Anthony Rendon: $6
7 — Archie Bradley: $5
8 — Francisco Lindor: $2.9
9 — Javier Baez: $2.65
10 — Cory Spangenberg: $1.863

Not too far off, right, with an exception or two. And the Diamondbacks giving Bradley $5 million is more than the $3 million value for the No. 7 pick now, but they saved in the aggregate with Trevor Bauer’s deal. In the new system, those two picks are valued at $8.2 million. Bauer and Bradley got $8.4 million.

This is far from a complete picture, obviously, and I hope to paint that as time goes on and more details become known. But it’s a little bit of a look at the fact that perhaps this isn’t as doomsday-ish as some early reactions made it out to be.

Much, much more to come.

The new CBA and amateur players

I’m still sorting through all the details, as best as I can, on the new CBA and how it impacts the amateur scene. Needless to say, this changes the Draft and the international signing landscape tremendously. There will be a more concrete story coming in a bit, but the first reaction is that teams like the Pirates and Royals, smaller-revenue teams who have used their resources to be aggressive in the Draft (and in international signings to an extent) are going to be handcuffed by this. But that’s just a gut reaction. Much more to come.

For now, though, I’m posting the parts of the CBA that pertain to the amateur scene here, broken out from the entire agreement:

III.. RESERVE SYSTEM INCLUDING AMATEUR PLAYERS
a. Free Agency
1. All eligible Players will become free agents as of the end of the World Series, with no
election required, and the “quiet period” will be five days.
2. The tender date will be December 2 beginning in 2012.
3. Article XX(B) free agents signing minor league contracts who are not added to the
Opening Day roster or unconditionally released 5 days prior to Opening Day shall receive
an additional $100,000 retention bonus and the right to opt out on June 1.
b. Draft Pick Compensation
1. Starting in 2012, “Type A” and “Type B” free agents and the use of the Elias ranking
system will be eliminated.
2. The current system of draft pick compensation will be replaced with the following
system:
A. Only Players who have been with their Clubs for the entire season will be subject
to compensation.
B. A free agent will be subject to compensation if his former Club offers him a
guaranteed one-year contract with a salary equal to the average salary of the
125-highest paid Players from the prior season. The offer must be made at the
end of the five-day free agent “quiet period,” and the Player will have seven days
to accept the offer.
C. A Club that signs a player subject to compensation will forfeit its first round
selection, unless it selects in the top 10, in which case it will forfeit its secondhighest
selection in the draft.
D. The Player’s former Club will receive a selection at the end of the first round
beginning after the last regularly scheduled selection in the round. The former
Clubs will select based on reverse order of winning percentage from the prior
championship season.
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c. Salary Arbitration Eligibility
1. The percentage of players with two years of service who will be arbitration eligible will
be increased from the top 17% to the top 22% in terms of service.
2. All players tied at the 22% cutoff will be eligible for arbitration.
d. Minimum Salaries
1. Major League will increase from $414,000 in 2011 to: $480,000 in 2012; $490,000 in
2013; and $500,000 in 2014; COLA in 2015 and 2016.
2. Minor League will increase from $67,300 in 2011 to: $78,250 in 2012; $79,900 in 2013;
and $81,500 in 2014; COLA in 2015 and 2016.
e. Rule 4 Draft
1. The draft will continue to be conducted in June, but the signing deadline will be moved
to a date between July 12 and July 18 depending on the date of the All-Star Game.
2. Drafted players may only sign Minor League contracts.
3. Signing Bonus Pools
A. Each Club will be assigned an aggregate Signing Bonus Pool prior to each draft.
For the purpose of calculating the Signing Bonus Pools, each pick in the first 10
rounds of the draft has been assigned a value. (These values will grow each year
with the rate of growth of industry revenue.) A Club’s Signing Bonus Pool equals
the sum of the values of that Club’s selections in the first 10 rounds of the draft.
Players selected after the 10th round do not count against a Club’s Signing
Bonus Pool if they receive bonuses up to $100,000. Any amounts paid in excess
of $100,000 will count against the Pool.
B. Clubs that exceed their Signing Bonus Pools will be subject to penalties as
follows:
Excess of Pool Penalty (Tax on Overage/Draft Picks)
• 0-5% 75% tax on overage
• 5-10% 75% tax on overage and loss of 1st round pick
• 10-15% 100% tax on overage and loss of 1st and 2nd round picks
• 15%+ 100% tax on overage and loss of 1st round picks in next two drafts
4. Proceeds generated by the tax will be distributed to payee Clubs under the Revenue Sharing
Plan that do not exceed their Signing Bonus Pools. Draft picks that are forfeited by Clubs will
be awarded to other Clubs through a lottery in which a Club’s odds of winning will be based
on its prior season’s winning percentage and its prior season’s revenue. Only Clubs that do
not exceed their Signing Bonus Pools are eligible for the lottery.
5. Competitive Balance Lottery
A. For the first time, Clubs with the lowest revenues and in the smallest markets will
have an opportunity to obtain additional draft picks through a lottery.
B. The ten Clubs with the lowest revenues, and the ten Clubs in the smallest
markets, will be entered into a lottery for the six draft selections immediately
following the completion of the first round of the draft. A Club’s odds of winning
the lottery will be based on its prior season’s winning percentage.
C. The eligible Clubs that did not receive one of the six selections after the first
round, and all other payee Clubs under the Revenue Sharing Plan, will be
entered into a second lottery for the six picks immediately following the
completion of the second round of the draft. A Club’s odds of winning the
lottery will be based on its prior season’s winning percentage.
D. Picks awarded in the Competitive Balance Lottery may be assigned by a Club,
subject to certain restrictions.
E. Top 200 prospects will be subject to a pre-draft drug test and will participate in a
pre-draft medical program.
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f. International Talent Acquisition
1. By December 15, 2011, the parties will form an International Talent Committee to
discuss the development and acquisition of international players, including the potential
inclusion of international amateur players in a draft or in multiple drafts.
2. For the 2012-13 signing season, each Club will be allocated an equal Signing Bonus
Pool.
3. For each signing period after 2012-13, Clubs will be allocated different Signing Bonus
Pools, based on reverse order of winning percentage the prior championship season
(i.e., the Club with the lowest winning percentage the prior season shall receive the
largest Pool).
4. Bonus Regulation of International Amateur Players
A. Beginning in the 2013-2014 signing period (July 2, 2013 – June 15, 2014), Clubs
may trade a portion of their Signing Bonus Pool, subject to certain restrictions.
B. Clubs that exceed their Signing Bonus Pools will be subject to the following
penalties in the 2012-2013 and 2013-2014 signing periods:
Excess of Pool Penalty (Tax on Overage/Draft Picks)
• 0-5% 75% tax
• 5-10% 75% tax and loss of right to provide more than one player in the next signing period with a bonus in
excess of $500,000.
• 10-15% 100% tax and loss of right to provide any player in the next signing period with a bonus in excess of
$500,0000.
• 15%+ 100% tax and loss of right to provide any player in the next signing period with a bonus in excess of
$250,000.
C. The penalties for exceeding the Signing Bonus Pool will increase beginning with
the 2014-2015 signing period if a draft or drafts is not agreed to by July 2014.
5. All international amateur players must register with the Scouting Bureau to be eligible to
sign, and the top 100 prospects will be subject to a drug test.
6. The Office of the Commissioner and the Union will form a joint committee to assist
international players with their transition to educational/vocational programs after their
baseball careers are over.

 

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