News broke late Wednesday night that owners and the Major League Players Association (MLBPA) had reached an agreement on a new collective bargaining agreement (CBA). This was good news because it means baseball will enjoy five more years of labor rest and a lockout was avoided. But as the terms began to leak out, well, the deal began to look more and more like a landslide victory for the owners and only a small victory for the players. I recommend reading the excellent Michael Baumann’s take on the new agreement here, and Jeff Passan’s work here for more perspective.
But the main question you may be asking is how the agreement will impact the Arizona Diamondbacks. The answer is simple: very little. Here are a few of the major changes the new CBA lays out:
- Changes in the luxury tax threshold
- Hard caps on international spending depending on market size, but no international draft
- The 15-day DL will be changed to the 10-day DL
- Home field advantage in the World Series will now be determined by best record
- The season will start mid-week in 2018 to provide a few extra days off during the season
- Teams will no longer have to give up a first round pick for a free agent who received a qualifying offer (although there are still penalties)
- Players can only receive the qualifying offer once
The luxury tax threshold for payroll will grow over the next five years, starting at $195 million and reaching $210 million by 2021. On one hand, that’s of basically no consequence for the D-backs as they’ll likely spend only 50%-60% of those totals over the span of the deal, so there’s no threat of the team having to pay luxury tax penalties (which were also modified). It does, however, mean that the D-backs may receive less revenue sharing as high-spending teams are expected to pay reduced penalties under the new rules. That’s not necessarily a good thing for the team, as any reduction in revenue threatens to effect the product on the field, and coming off a record-low in attendance in 2016, money’s already presumably tight.
Owners had reportedly been seeking a international draft rather than the current system of bonus pools, penalties and restrictions. They didn’t get it, unsurprisingly, but they did receive a win in that the new agreement places a hard cap on the dollars teams can spend on international talent under the age of 25. The spending caps relate to market size, and the Diamondbacks will have a budget of $4.75 million to spend annually on international talent, but may receive extra money based on market size, and can’t exceed whatever total they’re allotted, no matter what. This aspect of the new CBA has sparked the most outrage, as players like Yoan Moncada have elicited investments dwarfing that figure all on their own. As you well know, teams have been able to spend more money than they were allotted in the past, but had to pay a penalty in cash and lost opportunities (hello, Yoan Lopez). That opportunity will no longer exist and should suppress international earnings of players in developing countries. Teams will likely look for loopholes to skirt around these changes, but for now, it appears that while it levels the playing field for acquiring international prospects, it will keep prices down for owners, which was their ultimate goal when proposing an international draft in the first place. This comes at a cost to teenagers in the Dominican Republic, Venezuela and other countries, players that even after being drafted, do not have protection from the MLBPA. Attempts for minor league baseball players to unionize were struck down in court earlier this year.
This will impact the Diamondbacks because, simply put, they now have a hard spending cap. They’ve had to sit out much of the international action over the last two years thanks to the signing of Lopez in 2014, but their penalties expire at the end of 2016 and can once again be active players for higher priced prospects in 2017. Whether they intend to utilize all of their dollars is yet to be seen. There is, however, an opportunity for teams to trade their spending dollars to other teams, but there are limits to how much can be traded. Should the Diamondbacks wish to spend more than $5.25 million on the international market, they’ll have to acquire it. Should they wish to spend less than that, they’d do well to explore avenues for trading their international dollars. It’s a new market, one that will take some feeling out.
The change in the minimum length of a disabled list stay is going to have an impact on the roster, but one that will be felt evenly across baseball. With a 10-day stint now an option, starting pitchers can simply miss one start while another player is called up. Expect more trips to the DL for all players as teams have the option of being without their players for a shorter length of time than in the past, decreasing the penalty on a roster of having players on the shelf.
Home field advantage in the world series: let’s get to the playoffs first. Having some extra days off during the season means a few more rest days for players, and honestly, that’s a good thing. Rather than playing 162 games in 182 days, teams will now play 162 games in 187 days. It’s not a huge change, but one that players deserve.
The changes to draft pick compensation are unique. Players that receive a qualifying offer (QO) and turn them down will still cost the team that signs them in the form of a surrendered draft pick (or picks, depending on payroll). But that cost will decrease next season. Currently, teams that sign a player that turned down a QO are taxed by having to surrender their first round pick and a compensation round pick goes directly to the team that extended the QO to the player. Now, teams signing a player to a contract at or greater than $50 million that turned down the QO will lose a pick (or picks, again depending on payroll). For the Diamondbacks, should they sign this type of player (often the premier free agents), they’ll have to surrender a third round pick (provided they haven’t exceeded the luxury tax threshold, which seems nearly certain). If they extend a QO to a player and he turns them down, then signs a contract at or greater than $50 million elsewhere, they’ll receive a compensation round pick. So, for instance, under the new rules the Zack Greinke signing would have only cost the Diamondbacks a third round pick, not their first rounder.
While the D-backs aren’t likely to be out shopping the high end of the free agent market any time soon, the rules around compensation for losing players stays familiar. This may come into play should they lose players like Paul Goldschmidt, A.J. Pollock and others eventually to free agency in the future. They’ll likely look to trade these players before losing them to free agency, but it should be noted that there’s still compensation should it come to that.
While the new CBA will certainly send reverberations across baseball, the impacts on the Diamondbacks are relatively light. The team is not a big spender that will be impacted by luxury tax penalties, and while the new cap on international spending limits opportunities, the organization has never been a major spender on the international budget with any kind of consistency. Arizona isn’t often a big spender on the free agent market, but should they choose to be, the penalties are lighter now than they were in the past, perhaps encouraging them to up their spending in the future. While there will be impacts that arise over time, the D-backs appear to be coming out of the new CBA, along with most other small and medium-market clubs, relatively unscathed.
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