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Compensatory Picks Hurting Free Agents

Compensatory Picks Hurting Free Agents

| On 22, Dec 2013

There has not been substantial audible conversation about Cleveland Indians free agent starting pitcher Ubaldo Jimenez, despite being frequently listed amongst the top free agents available entering this offseason.

Cleveland tendered Jimenez a $14.1 million qualifying offer in early November, securing the Indians a draft pick if the resurgent pitcher opted to leave town for a longer and more financially enticing offer.

Like each of the other twelve players around Major League Baseball to be offered such a deal, Jimenez declined and hit the open market. Since then, mum has been the word on Jimenez as the pitching market remains unresolved. With draft pick compensation looming in addition to his contract, the lost portion of draft bonus pool money, and the uncertain status of Japanese starter Masahiro Tanaka grinding the market to a halt, Jimenez remains out of a job for the time being.

Five of the players given qualifying offers remain available in the marketplace in the final stretches of December. This does not include former Indians outfielder Shin-Soo Choo, who came to terms on Saturday on a seven-year, $130 million agreement with the Texas Rangers.

For the small- and mid-market teams around the MLB, the qualifying offer essentially protects them from losing an expensive and talented player with nothing to show for all of the hard work that teams spend on development. It remains one of the few tools that teams have at their disposal, outside of dedicating a majority of payroll to one player, to try to keep the larger spending teams away from their best available players.

And it does not come without its own explicit risk – had players like Jimenez, Kendrys Morales, or Ervin Santana accepted the qualifying offers made by their respective clubs, it would have marked a substantial amount of payroll tied up in just one player. Had Morales, for example, accepted the offer, it is difficult to imagine a scenario that the Mariners would have become a player for second baseman Robinson Cano without purging money from somewhere else on the roster, given their $72 million payroll in 2013, 24th in baseball of 30 teams.

For the big market monsters, the same offers could be used to scare away some of the bottom feeders and dumpster divers around the league. Teams that do not devote a significant amount of cash to the construction of their roster have to rely heavily on building and developing through the draft. The thought of giving up a high, unprotected draft pick is enough to make most teams reconsider a player’s worth.

If the Indians had offered their former starter Scott Kazmir a qualifying offer in November, there is a chance that he would have accepted the one-year tender to continue to rebuild his worth for the following free agency period. Had he actually received and declined the offer, one has to wonder if he would have been a player the Oakland Athletics would have targeted, knowing that his acquisition would have cost the club its first round pick, 27th overall, in the 2014 draft.

Oakland, in true small market fashion, rebuilds through the drafting and then trading of its developed young prospects for new prospects before the budding stars can walk out the door, leaving the organization with nothing to show for the time and energy it put into the ball player.

Last season, the Indians were willing to surrender a draft pick to acquire the New York Yankees veteran free agent outfielder/first baseman, Nick Swisher, one of nine players following the 2012 season to be extended a qualifying offer (at $13.3 million that season). Cleveland gave the Ohio State Buckeye a four-year, $56 million contract, but because their draft pick fell in the protected top ten picks, they retained their number five overall pick that would be used on Clint Frazier and instead relinquished their second-round selection.

Nearly four months after the start of last season’s free agency period, some of the better names in the free agent pool were still available as spring training was starting.

Michael Bourn was one of the nine players given a qualifying offer last season. He ultimately came to terms with Cleveland in February in what felt like a surprising move by the Indians, straight out of center field after the team had already spent substantially and atypically on Swisher, Mark Reynolds, and Brett Myers. Represented by Scott Boras, Bourn settled on a four-year, $48 million deal.

Reports early on in that offseason had the former Atlanta Braves outfielder seeking a nine-figure deal. He was replaced in Atlanta by B.J. Upton and his $75 million contract and, after several other potential suitors filled their needs with cheaper options on the market or via trade, Bourn’s options became fewer and fewer. In the end, he got less than half of what Boras had hoped to pull for the speedster.

The Indians, having a protected first round pick and having already surrendered their second round pick to sign Swisher, gave up a competitive-balance pick slated to come in at the end of the second round to sign Bourn. The New York Mets, one of the teams rumored to be interested in Bourn’s services, were unwilling to sign him because their pick (11th overall) was not protected, even though they had tied for the tenth-worst record.

Had their first pick been protected because of their record and because they knew that they would be giving up the ninth pick in the second round (48th overall), the Mets may have moved on the career-long National League veteran Bourn. Instead, the Mets signed former Yankees center fielder Curtis Granderson this month to a four-year, $60 million contract to patrol the outfield at Citi Field. They will surrender their second-round draft pick, expected to slot somewhere in the early 50’s, as a result of the signing because their first round pick (10th overall) is protected.

Starting pitcher Kyle Lohse was coming off of a 16-3 season with a 2.86 ERA and league-high 33 starts with the St. Louis Cardinals in 2012. The Cardinals offered him the one-year, $13.3 million qualifier, but the 34-year-old passed. He did not sign with the Milwaukee Brewers until a week before Opening Day on a three-year, $33 million deal. The Brewers forfeited their 17th pick in the first round in order to sign the starter.

He finished 11-10 with a 3.35 ERA in 32 starts for the Brewers last season.

The intention behind the qualifying offer and draft pick compensation seemed legitimate. In theory, teams losing big free agents would at least be compensated for their losses with a first round pick the following season. The rich would not necessarily keep getting richer by buying the best while still drafting high picks for their use in the future, either as potential prospects or future trade fodder. By taking some of the higher draft picks away from the higher spending teams, there would be better players on the table to draft for other teams not seeking out high profile free agents and instead opting to build from within.

As it stands, the system has not balanced the competition around the league but instead limited the number of potential investors in a free agent’s services. While this helped the Indians to rebuild quickly with the additions of Swisher and Bourn in the same offseason as the team exploited the new competitive balance picks, not all teams have benefited in such a way.

Of the 13 players offered this season, five have signed in New York (Carlos Beltran, Jacoby Ellsbury, Hiroki Kuroda, and Brian McCann with the Yankees; Granderson with the Mets), one re-signed in Boston (Mike Napoli), and two others headed to the AL West (Cano to Seattle and Choo to Texas).

Only one of those clubs is viewed as a smaller market club.

Jimenez and Santana still sit, playing the waiting game, counting down the weeks and days and hours until someone comes calling for their talents. Meanwhile, their options around the league dwindle daily due to salary and market restrictions, fear of lost draft picks, uncertainties about their previous track records, or because of a general lack of interest or need.

In the end, all scenarios could be beneficial to the Indians, who could still be in play for Jimenez even after the signing of Shaun Marcum during the week. If teams balk at his price tag (both in financial and intangible costs) or number of years, Jimenez could become Lohse 2.0. Cleveland may become a fallback option for him, with a reunion with the familiar coaching staff, led by pitching coach Mickey Callaway, that helped guide him back to success.

Photo: Jason Miller/Getty Images