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Sunday, January 05, 2014

Rosenthal: Now’s best time for Angels to add payroll, pay luxury tax

Message to Los Angeles Angels owner Arte Moreno: You’re eventually going to blow past the $189 million luxury-tax threshold. So, you might as well start this offseason.

Moreno’s desire to stay under threshold has figured prominently into the Angels’ offseason restructuring, factoring into trades, non-tenders and other decisions.

Well, according to sources, the team’s wiggle room is down to between $13 million and $15 million, depending on how much players earn in performance bonuses.

The average salary for Japanese right-hander Masahiro Tanaka certainly would push the Angels past the threshold, and the average for free-agent righty Matt Garza might, too (remember, luxury-tax calculations are based on average salary, not single-season salaries).

Exceeding the threshold would not cost the Angels too badly in 2014 — the penalty for a first-time offender is only 17.5 percent, meaning the Angels would pay a mere $1.75 million if they went $10 million over, or $3.5 million if they went $20 million over.

Future years, though, could be a problem, as pointed out by monkeywithahalo.com. As the Yankees can attest, a team pays a 30 percent tax the second time it exceeds the threshold, a 40 percent tax the third time and a 50 percent tax the fourth time.

Thanks to BN

Repoz Posted: January 05, 2014 at 11:42 AM | 28 comment(s) Login to Bookmark
  Tags: mlb

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   1. BDC Posted: January 05, 2014 at 01:57 PM (#4630521)
Sign Nelson Cruz too, while you're at it. 110/5 sounds like a good deal on him.
   2. Jim (jimmuscomp) Posted: January 05, 2014 at 02:53 PM (#4630564)
This team needs to get younger and cheaper, STAT. But it's not likely to happen anytime soon. Too many big contracts and not enough coming through the farm to help at the big league level.

Calhoun will help.

The Trumbo trade helped. Getting young, cost controlled starting pitching - even if Skaggs/Santiago(?) become #4 and #5 in the rotation at best - is a coup for Dipoto. So, that was a good move that will help now and in the near future.

I do, however, understand the idea that the team is built to "win now" and might as well go for it with a Tanaka or Garza. Pujolsmight have a few more strong-ish seasons in him and if Hamilton has anything left it will be the next couple of years. Couple that with Weaver and Wilson showing signs of age-related decline (not really Wilson, but it's coming...) and I can see the urgency to win now.

It's definitely weird to go all-in for a Pujols and Hamilton and then get shy when it didn't work. Short of a Red Sox-like sell-off of Pujols/Hamilton I don't see how this team gets under $189 million while adding what needs to be added to go from potential 85-win team to 95-win team.
   3. Walt Davis Posted: January 05, 2014 at 03:56 PM (#4630632)
It's always a good idea to do a 180 on your offseason strategy in the middle of the offseason.

Because of the way the lux tax escalates, there's almost no point in barely going over the line. The difference between a $189 payroll and a $192 payroll is not worth paying a 30-40% premium on FAs in the future. Especially since I think the Angels are more than a Matt Garza away from being a top contender.

Maybe they should have gone all-in this offseason or maybe they should have at least cleared enough room for Tanaka. Maybe they got caught off-guard by the posting rule changes and were hoping half of their Tanaka money would be off the books. But at this point I don't think they have much choice but to ride it out with (mostly) what they've got.
   4. Tim D Posted: January 05, 2014 at 04:41 PM (#4630674)
If I was Arte M. I would be looking for a Fielder-to-Texas miracle type of trade for Pujols. Maybe they could get rid of half the salary. I doubt anyone would touch Hamilton; Pujols was hurt and will likely still be a masher for a while.
   5. Jim (jimmuscomp) Posted: January 05, 2014 at 05:00 PM (#4630709)
Albert has a full no-trade clause in his contract.

Ugh.
   6. Ivan Grushenko of Hong Kong Posted: January 05, 2014 at 06:29 PM (#4630772)
Because of the way the lux tax escalates, there's almost no point in barely going over the line. The difference between a $189 payroll and a $192 payroll is not worth paying a 30-40% premium on FAs in the future. Especially since I think the Angels are more than a Matt Garza away from being a top contender.

Why aren't they? If Garza's a 2 Win pitcher, they've got a non-horrible rotation in Weaver, Wilson, Garza, Richards and Skaggs. A pen of Frieri, de la Rosa, Smith and Santiago isn't terrible either. If they can get 6 WAR from Pujols and Hamilton combined, they could have the best lineup in baseball. Mike Trout masks a multitude of sins. That might not be as good as the Red Sox or Tigers but it should compete pretty well with the Rangers, A's and Mariners.
   7. PASTE Thinks This Trout Kid Might Be OK (Zeth) Posted: January 05, 2014 at 06:45 PM (#4630801)
Mike Trout's going to get expensive (in an absolute sense; he'll quickly get big contracts in arbitration if he goes there) soon, and it's only four years now before he gets mind-bogglingly expensive. I'm sure Moreno is cognizant of this.
   8. Nasty Nate Posted: January 05, 2014 at 06:48 PM (#4630807)
Yeah, it's easy to see how the Angels could win 95 games this year. But I think that for about 15-20 teams...
   9. ptodd Posted: January 05, 2014 at 07:53 PM (#4630883)
I wonder if the Angels would be better off trading Trout than giving him 10/300 and going over 189. I mean, what do you think they could get for Trout?. A team like the Red Sox who will need OF'ers in a couple of year with little relief in sight from their farm system might be willing to part with a number of prospects and a young MLB ready players like JBJ and Middlebrooks, not to mention some of their surplus MLB pitching.

How about Jackie Bradley Jr, Barnes, Owens, Middlebrooks, Cecchini, Peavy. Red Sox would then sign Drew and move XB to 3B.
   10. Los Angeles El Hombre of Anaheim Posted: January 05, 2014 at 07:55 PM (#4630886)
I do, however, understand the idea that the team is built to "win now" and might as well go for it with a Tanaka or Garza. Pujolsmight have a few more strong-ish seasons in him and if Hamilton has anything left it will be the next couple of years. Couple that with Weaver and Wilson showing signs of age-related decline (not really Wilson, but it's coming...) and I can see the urgency to win now.
There's also the pressure of the Dodgers. Nothing hurts Moreno's efforts to establish the Angels as a Los Angeles team than to have the actual Los Angeles team outplay the Angels and get into the playoffs. To run with the Dodgers, Moreno will have to continue to spend like them to some great degree to get established, overpaid FAs until the farm system can come up with some fresh meat. Wilson and Weaver, Pujols and Hamilton, Kendrick and Aybar... Nearly the entire core of the team is at, or at the end of, their primes, if not already past it, but good health and Mike Trout can still mean another postseason. Garza would help a lot; the Angels need to take a shot at him.
   11. JJ1986 Posted: January 05, 2014 at 07:57 PM (#4630888)
If you're going to make a fake Red Sox trade for Trout, you have to include Bogaerts.
   12. Los Angeles El Hombre of Anaheim Posted: January 05, 2014 at 07:58 PM (#4630891)
I wonder if the Angels would be better off trading Trout than giving him 10/300 and going over 189. I mean, what do you think they could get for Trout?
I would be thrilled if Trout stayed for 10/300. He would be an absolute bargain at that price.

How about Jackie Bradley Jr, Barnes, Owens, Middlebrooks, Cecchini, Peavy. Red Sox would then sign Drew and move XB to 3B.
It would be worth it ONLY if the Angels completely bottomed out. In no other scenario would that be a good idea, and even then you'd want to ask for more if you're the Angels.
   13. valuearbitrageur Posted: January 05, 2014 at 08:10 PM (#4630916)
Finally, someone who understands that Arte Moreno's mistake was in not spending enough money badly. Wait, er what?
   14. Los Angeles El Hombre of Anaheim Posted: January 05, 2014 at 08:12 PM (#4630921)
Finally, someone who understands that Arte Moreno's mistake was in not spending enough money badly. Wait, er what?
No one's saying that Moreno should spend money badly. The team needs help, and the farm system's pretty dry. If the Angels are going to be playoff contenders, they're going to have to pony up the money. Just not badly.
   15. PASTE Thinks This Trout Kid Might Be OK (Zeth) Posted: January 05, 2014 at 08:29 PM (#4630942)
I wonder if the Angels would be better off trading Trout than giving him 10/300 and going over 189.


Absolutely impossible to trade Trout and get fair value back.
   16. Walt Davis Posted: January 05, 2014 at 09:31 PM (#4631011)
OK, they are closer to contending than I gave them credit for. It's still a "squint" though -- Pujols and Hamilton bounce back decently, Freese doesn't stink, Weaver and Wilson and (Garza) stay healthy while the two young starters are healthy and effective and Ibanez has 400 good PA left and .... May only need half of those things to get into the WC chase. I still don't like their SP depth even if they add (Garza) but there aren't many teams with SP depth.

But if they were concerned about going over the threshold, spending $5.25 on Joe Smith and even $2.75 on Ibanez doesn't look very efficient to me.
   17. Machine Posted: January 05, 2014 at 09:42 PM (#4631017)
How about Jackie Bradley Jr, Barnes, Owens, Middlebrooks, Cecchini, Peavy. Red Sox would then sign Drew and move XB to 3B.


Bradley Jr. OR Middlebrooks, but not both. Trout is very close to being expensive and there is no reason Boston should have to give up two very good cost controlled MLB players.
   18. Los Angeles El Hombre of Anaheim Posted: January 05, 2014 at 09:58 PM (#4631024)
Looking back on Willie Mays at 24, what package of non-Hall-of-Famers WOULDN'T you trade for Mays? Especially with today's rules, when you can buy average players to surround him with? That's Mike Trout. I'm a biased Angel fan, but I agree with [15]: it's damn near impossible to get equal value for Trout in any realistic trade.
   19. valuearbitrageur Posted: January 05, 2014 at 10:03 PM (#4631025)
No one's saying that Moreno should spend money badly. The team needs help, and the farm system's pretty dry. If the Angels are going to be playoff contenders, they're going to have to pony up the money. Just not badly.


It's hard to buy free agents well. And your system is always going to be dry if you keep signing free agents and surrendering your most valuable picks. Barring a magical Hamilton trade, best option is to rebuild slowly and hope for bounce backs from Albert and Josh. You have Trout for 4 more years, reload the farm so you can compete during the end of it as well as next year,, and hopefully the team is good enough to get him to re-sign..
   20. GregD Posted: January 05, 2014 at 10:11 PM (#4631028)
The doom and gloom here seems a little exaggerated to me. They won 78 last year and pythaged to 81. The year before they won 89. I would imagine you would start next year's projection around 85-86? That shouldn't be enough for the playoffs, but the projections of division leaders are usually around 88-89, aren't they?

If you were given the Angels +4.5 for the final playoff spot, wouldn't you take it? I would.

The narrative that gets them to 95 wins is a fraught narrative, but that's true of a bunch of teams. The narrative that has them in the race with the team they have assembled now isn't a crazy narrative at all, though.
   21. snapper (history's 42nd greatest monster) Posted: January 05, 2014 at 10:15 PM (#4631032)

Bradley Jr. OR Middlebrooks, but not both. Trout is very close to being expensive and there is no reason Boston should have to give up two very good cost controlled MLB players.



Hah, Hah, Hah, Hah!!!

Bogaerts, Bradley, Middlebrooks, and 5 other prospects of Anaheim's choice, and the Sox should say yes in under a second.
   22. JJ1986 Posted: January 05, 2014 at 10:19 PM (#4631033)
We should probably wait for someone to have MLB success before declaring him a "good...MLB player."
   23. Jeff Frances the Mute Posted: January 05, 2014 at 10:34 PM (#4631042)
Pujols has looked like a sloppy mess the last couple of years. He has been letting himself go Tony Gwynn style. I will believe that he is going to bounce back if he shows up to spring training minus 20 lbs.
   24. GregD Posted: January 05, 2014 at 10:38 PM (#4631043)
Pujols has looked like a sloppy mess the last couple of years. He has been letting himself go Tony Gwynn style. I will believe that he is going to bounce back if he shows up to spring training minus 20 lbs.
Perhaps if he is in the best shape of his life?
   25. Crispix reaches boiling point with lackluster play Posted: January 05, 2014 at 10:52 PM (#4631056)
Looking back on Willie Mays at 24, what package of non-Hall-of-Famers WOULDN'T you trade for Mays?

That was in the reserve clause era. I don't think Willie Mays made more than $100,000 a season until he was in his 30s. ($105,000 in 1963 would be about $800,000 now)

Whereas today, as the Angels more than anyone else are aware, fitting a supermegastar salary into your payroll means you probably skimp somewhere else.
   26. haggard Posted: January 05, 2014 at 11:18 PM (#4631071)
Willie Mays never won a world series after he turned 24
   27. Los Angeles El Hombre of Anaheim Posted: January 05, 2014 at 11:22 PM (#4631075)
Whereas today, as the Angels more than anyone else are aware, fitting a supermegastar salary into your payroll means you probably skimp somewhere else.
I'm not sure that's true, or at least not AS true as before. The Angels are basically printing money at the moment, and in a world where James Loney's production nets 3/21, 10/300 for Trout is completely worthwhile when the team can carry a budget upwards near $200 million.
   28. Shibal Posted: January 05, 2014 at 11:34 PM (#4631080)
I have the Angels as an 85 win team this year. They aren't going to be horrible; they'll be fighting it out for the division with the A's and Rangers.

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