First Pitch: This is Where the Pirates Need to Spend Money

A few years ago, we asked Pittsburgh Pirates president Frank Coonelly if the team could eventually afford a $70-80 M payroll. He answered that the team could afford that payroll after attendance increased. That led to a series of expectations.

1. The Pirates would eventually become competitive.

2. The attendance would increase due to the Pirates winning.

3. The payroll would go up.

Number three on that list has always been the focus of Pirates fans. The Pirates increasing payroll has always been seen as the part where they hold up their end of the bargain. Personally, if I’m looking for one thing out of a team, it’s winning, rather than spending. It seems there is too much focus on the size of the payroll and not the quality of the team, which looks to be a contender once again.

The Pirates have been increasing their spending, but they still have room to add more payroll. They definitely shouldn’t spend just to spend. They need to spend where it makes sense. And the place where spending makes the most sense is on their own young players.

One of the biggest problems with free agency is that the majority of players who enter free agency are over the age of 30. They’re looking for a high-priced deal, and several years, yet they’re entering the downside of their careers. In most cases, you’re paying for past production, and getting much less than that. The first few years of the deal might work out, but often the downfall is steep and costly.

The availability of a lot of top of mid-level free agents is getting scarce, since a lot of teams are extending their best players before they reach free agency. That means you’re not going to see a lot of options, and the options who are available have the above concerns with age. Most of the younger guys who are available have some sort of issue, and are more of a project (Edinson Volquez, Francisco Liriano, Josh Johnson). That’s not to say that you can’t get a good deal through free agency (Russell Martin is a prime example that you can), but deals through free agency seem to be rare these days.

I believe teams are extending their young players more and more because the risk is much lower than what you’d see on the free agent market. Take the recent Freddie Freeman extension, for example. Freeman just got eight years and $135 M from the Atlanta Braves. That covers his three arbitration years, and five free agent years. The deal averages out to $16-17 M per year, which seems like a lot for a guy who is just entering arbitration. But it also seems smart when you consider the alternatives.

Freeman would have originally been a free agent after his age 26 season. He would have been extremely valuable hitting free agency that young, and probably would have gotten at least $16 M per year, if not more. He’d definitely get more if he continues improving his game in the next three years. But even if he maintains this level, he’d be looking at a pretty big deal. That means the Braves are looking at two scenarios. They’re either going to be paying too much for Freeman’s arbitration years, and getting him for market rate in his free agent years, or they’re going to be getting a value over the life of the deal. The best part of the deal is that the risk is lower than most long-term deals. Freeman was extended through his age 31 season. That means he’s less likely to face injuries or decline due to age.

This is a similar approach as the one the Pirates took this off-season with Charlie Morton. They signed him to a three-year, $21 M deal, which could be worth four years and $29.5 M. He got what he was projected to receive through arbitration this year, and his free agent years are pretty close to market rate (two years, $17 M, or three years, $25.5 M). If Morton continues pitching like he did in 2013, then the overall deal could look like a nice value. As for the risk, he’s under team control through his age 33 season, and that final year is an option with a $1 M buyout.

The Pirates also got Andrew McCutchen a few years ago on an extension through his age 31 season. We already know that this deal is a massive value for the team, so pointing out anything beyond the contact value is overkill. But the Pirates got the bulk of McCutchen’s prime years, without having to pay for the bulk of his decline years.

This is the approach the Pirates should take with any of their top guys. That’s unlikely to happen with Gerrit Cole and Pedro Alvarez, since they’re Scott Boras clients and Boras doesn’t usually sign these types of deals. But it could be an option for other players. To get an idea of who should be a candidate, here is a look at the top extension candidates currently under team control, and the age they’re eligible for free agency.

Neil Walker – His first year as a free agent would be his age 31 season. I don’t think he would be a good extension candidate, since he already has some injury red flags in his 20s. I think the future middle infield would be Alen Hanson and Jordy Mercer. However, if one of those two doesn’t work out, or if they need a third base option, a Walker extension would make sense.

Starling Marte – He would be my top extension candidate. He’s currently under team control through his age 29 season. He put up a 4.6 WAR in his first full season in the majors. He draws concerns for his lack of walks, but reaches base more often due to his speed, and has a lot of value due to his base running and defense. He also originally signed for $85,000, so he might be open to a big pay-day.

Jordy Mercer – This is another Neil Walker situation. Mercer’s offense, if he repeats his 2013 numbers over a full season, would be top ten as a shortstop. He also is under team control through his age 31 season. That means the Pirates might want to wait a year or two and see what they’ve got with Mercer before offering him an extension.

Pedro Alvarez – An extension seems unlikely, since he’s already under contract for his first year of arbitration. Right now he’s under team control through his age 29 season. That means he’s looking at a potentially big deal as a free agent. I don’t see Boras taking a deal here, since a 29-year-old third baseman could get a massive deal, and that deal is only three years away.

Gerrit Cole – Any talk of extending Cole is wishful thinking, due to Boras.

Gregory Polanco – If there’s any player who would be great for an Evan Longoria type extension, it would be Polanco. He signed for $150,000, and profiles as an impact player. That means he might be willing to sign a big deal early, and could be very worth that big deal. He is 22 this season, and would be eligible for free agency after his age 28 season. Longoria got a six-year deal right after coming up, with three option years. That bought out two of his free agent years. A similar deal for Polanco would have him under control through his age 30 season.

Jameson Taillon – The Pirates might want to wait a few years to extend Taillon, but he seems like a better candidate than Cole, simply because he’s not represented by Boras.

In most cases, players don’t sign extensions until they’re eligible for arbitration (such as the case with Freeman), or a year before they’re eligible for arbitration (McCutchen as an example). The two guys who could be early extension candidates would be Marte and Polanco, due to the fact that they didn’t receive big bonuses when they originally signed.

The Pirates are unlikely to extend everyone here. It would be great if they could extend Alvarez beyond the 2016 season, giving them more time to figure out the third base situation for the long-term. But they’re unlikely to get Alvarez to a favorable deal (something where he’s not under contract into his mid-30s), and they’re probably going to have to pay market rate, thus assuming all of the risk in such a deal, with a smaller chance for any value.

As for the guys who are candidates for an extension, those could be some of the best deals the Pirates could possibly make. We’re seeing just how good the McCutchen extension is working out. That deal is looking like one of the best bargains in the game, and looks better and better with each extension that is signed. Imagine having two more bargains in Marte and Polanco. Even if the deals end up like Jose Tabata, that’s not a bad thing. Tabata might be slightly over-paid, but he essentially amounts to an expensive fourth outfielder, and his contract is not hurting the Pirates at all. If he repeats his 2013 value each year (1.1 WAR), then he’ll be worth his remaining deal (three years, $12.25 M guaranteed remaining).

Links and Notes

**The 2014 Prospect Guide is now available. You can purchase your copy here, and read about every prospect in the Pirates’ system. The book includes our top 50 prospects, as well as future potential ratings for every player.

**Last week we finished our countdown of the top 20 prospects in the Pirates system. The number one prospect was Gregory Polanco. Click the link to read his scouting report, along with the complete list of top 20 prospects. If you enjoyed all of the reports, you can get more by purchasing the 2014 Prospect Guide.

**Our own James Santelli was Nominated For a SABR Award. The award is based on a vote. Click that link for information on how to vote for James and Pirates Prospects.

**Prospect Links: Gregory Polanco, Austin Meadows, ZiPS

**Taillon and Glasnow Named Among the Top Pitching Prospect Duos

**Pirates Spent $2.58 M in International Bonuses in 2013

 

Tim Williams

Author: Tim Williams

Tim is the owner and editor in chief of Pirates Prospects. He started the site in January 2009, and turned it into his full time job during the 2011 season. Prior to starting Pirates Prospects, Tim worked with AccuScore.com, providing MLB, NHL, and NFL coverage to various national media outlets, including ESPN Insider, USA Today, Yahoo Sports, and the Wall Street Journal. He also writes the annual Prospect Guide, which is sold through the site. Tim lives in Bradenton, where he provides live coverage all year of Spring Training, mini camp, instructs, the Bradenton Marauders, and the GCL Pirates.

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  • jamminjoe66

    Since your mentioning young guys who could be candidates in a couple of years Lambo & Sanchez maybe best bargains worth taking a Tabata type chance on.

    • stickyweb

      jammin,
      The difference is Tabata signed his extension at 23 with some MLB experience already in his pocket. That gave the Bucs his services through 27 with very reasonable options through his 30 year old season.

      Assuming Lambo gets significant time this year, he wouldn’t even be arb eligible until his 28 season and Pirates could control him through his 30 season with arb. Assuming Tony Sanchez doesn’t get enough time this year to start his clock, he’d be a year older than Lambo each step of the way.

      They both look more like Walker (i.e. control through prime years, any extension would be taking risk through early 30′s years) than Tabata.

      Let’s hope Lambo has a good enough year that we need to discuss this further next off season!

  • http://www.facebook.com/adrian.carnelutti Adrian Carnelutti

    While sort of agreeing that extending Neil Walker might not be wise given his injuries and average defence, don’t forget that baseball is a business and having the local boy is always a good promotional tool and he makes a great spokesman for the club with the local fan base. I know that fans like winning and that’s brings them into the ground but I still think that having that connection to the Pittsburgh community is important and worth keeping.

  • http://www.facebook.com/bill.kline.547 Bill Kline

    Does this mean you are expecting Cole and Alvarez to leave the Pirates via free agency when the time comes?

    • http://www.facebook.com/matt.beam.16 Matt Beam

      yes, which is why you want a replacement ready 1-2 years before absolutely necessary so they can be traded for a haul of prospects… TB getting 2 huge impacts guys for Shields and Davis being the best example

      unfortunately, it doesn’t look like Pedro’s eventual replacement is internal unless Neil is switched to 3B (which means Mercer and Hanson have worked out well)

      • jaygray007

        this seems like a nice time to pimp my “sign sandoval or headley next year” campaign.

        • http://www.facebook.com/bill.kline.547 Bill Kline

          Id rather see that money put towards keeping Pedro and Cole

          • jaygray007

            I’ll agree on Cole, but not Pedro. I just don’t think he’s the kind of guy who you hand a big fat contract to.

            Let’s say they sign him to a 5 year extension… so buy out his 2017,18,19,20, and 21 seasons. he turns 27 tomorrow.

            so 28 for the 2015 season, 29 for 2016, 30 for 17 (this is his first free agent year that would be bought out by a contract), 31 for 18, 32 for 19, 33 for 20, and 34 for 21.

            do we think that pedro alvarez is going to be a third baseman when he’s 34? even when he’s 30?

            if no, would he be worth 17 million a year (of present day dollars. it’ll be more then because of inflation) as a first baseman? a lot of his value comes from the fact that he’s an above average offensive 3b right now. he’s not really an above average offensive 1b.

  • http://www.facebook.com/kenneth.moore2 Kenny Moore

    Just as long as no more Tabata like deals are given I am ok with them if they are smart about who gets them. Great point about Boras and his clients.

    A little off the subject, but if the Bucs are going to let AJ pitch somewhere else they need to spend that money on a 1B like Kendrys Morales. The Pirates have a good farm system and the first rd pick he would cost I think its worth it. Its a huge hole at first base that needs to be addressed and Morales fills that hole.

    • https://profiles.google.com/115522615427589477970 Mike C.

      i know some ppl might use the tabata deal as the argument againts such deals (not saying u are) but i think all new deals come with risks, nothing is guaranteed.
      but i say, I’d rather have 2 tabata busts on the book than 1 of Ryan Howard, Pujols or the new Choo deal.(many r already saying the choo deal was a big overpay/mistake)

    • http://MultiMatchupSports.com Stephen Stasa

      Morales had a .780 OPS against RHP last year, .791 the previous year, and missed the entire 2011 season. I’d rather they just pocket the money and keep the draft pick than pay Morales for his production from 2010 and earlier. I realize they’re all the way down at 25 in the draft this year and it’s not like you’ll get a Mike Trout that far down… … need to keep the pipeline full is all I’m saying.

      Seriously, am I the only person who is hoping the Pirates DON’T bring in anybody to replace Lambo to play 1B against RHP? He comes with no cost. He hit 33 HRs last year (1 in the majors). “Steve Pearce” is not a reason to dismiss that. Granted small sample but he went from 4 hits in 21 ABs to 3 hits in 9 ABs with a towering HR. Give him time to adjust as an (almost) everyday player and see what he can do. You can always make a trade in May/June if he doesn’t work out (and you can use that first round pick at that point if need be).

      • scbucsfan

        There is a reason Lambo was a top prospect. I think he was immature and didn’t take advantage of his talents. With age comes wisdom, I think last year he finally realized the talent he was wasting. You can’t just dismiss 35 HR. Like you said, if it doesn’t work out someone will be available at the trade deadline.

      • michaelbro8

        ” I realize they’re all the way down at 25 in the draft this year and it’s not like you’ll get a Mike Trout that far down”
        – I think Trout WAS picked 25th

        • BigB2323

          haha yes he was in the 20′s

      • BigB2323

        Better go check when Mike Trout was drafted

    • tom2125

      Really? Morales? He is a dh, not a first baseman. He doesn’t give any added value over a gabby and Lambo or whoever platoon at first. His defense would cancel out his bat plus we would lose the draft pool money and pick. The pirates win because of pitching and defense and by drafting well. They lose on all 3 aspects if they would sign Morales

    • meatygettingsaucy

      The Tabata deal was very team friendly with the assumption that, if Tabata did not pan out, it wouldn’t be a contract that didn’t set the Pirates back years.

      “1B like Kendrys Morales”. Kendrys Morales is not a 1B. He is a DH. He would not, under the circumstances, be able to handle a full season at 1B. Huntington would not sacrifice a first round draft pick for a guy who is going to platoon or be a bench bat. Morales is not happening, thankfully. No need to spend money just to spend money. Morales isn’t worth it at all.

    • Cato the Elder

      You realize that Tabata and his intolerable contract put up the same WAR as Kendry Morales did last year, right? And Morales would be 2 to 3 times as expensive as Tabata in addition to costing the Pirates a 1st round pick. Oh and Morales is more or less incapable of playing first base. Other than that I agree with your point: smart deals are smart; dumb deals are dumb.

      • http://www.facebook.com/joshdziomba Josh Dziomba

        that is exactly why WAR is a gabage stat! Jim Duquette was just talking about how WAR is good in theory but it doesnt make any sense when you actually look at it. The example was Freddie Freeman vs Craig Kimbrel , 3.5 – 3.3 WAR for last year…Kimbrel is awesome but Freeman is way more valuable and leads to more wins … The fact that Tabata has as much WAR as Morales is just stupid …

        Also I dont think they should give up the first round pick, but I would be fine with Morales at first… Garret Jones was exactly John Olerud over there

        • stickyweb

          The Kimbrel-Freeman comparison may have more weight to it, but if Tabata-Morales proves WAR is stupid, it also proves BA, OPB, and SLG are stupid too. Kendrys’ 2013 line .277/.336/.449 vs. Tabby’s .282/.342/.429.

          Kendrys had a couple of decent season’s a few years ago, but with the bad defense and injuries, he’s just not that good right now. And he and Boras are finding that out.

        • Cato the Elder

          A garbage stat, eh? I don’t want to get in a huge argument here, but just a couple of quick points.

          Tabata triple slashed 282/342/429 while Morales hit 277/336/449. Now Morales had more plate appearances, but those are bad numbers for a DH and when he wasn’t a below average DH Morales was an even worse defensive 1B. While Tabata’s numbers aren’t great and while Tabata is a pretty mediocre defensive RF, even mediocre RF is far more value added than DH or poor 1B. Furthermore, suffice it to say that Tabata was measurably a better baserunner than Morales. That’s how they end up so close. They hit similarly, Morales had more at bats, Tabata contributed more defense and baserunning.

          As for the Freeman/Kimbrel comparison, I think it is easy to just assert one was more valuable than the other, it is harder to prove. But I get the point. Two things: 1) WAR has some issues properly valuing closers – the issue has to do with how to weight playing time vs leverage – and while it is not unfair to point out the discrepancy, comparing a relief pitcher to an everyday 1B is more challenging than comparing to pitchers. 2) This is even more exasterbated by this specific example because Kimbrel is a very good pitcher (in addition to being a closer) and because Freeman had a unusually impactful season finishing 4th in WPA (win peobability added) just barely behind Miguel Cabrera. That is to say that Freeman did a lot of his best hitting at crucial moments late in the game, close score, runners in scoring position, etc, so he was almost certainly more valuable than his raw numbers would indicate. WAR is (generally) context neutral; baseball is not. (Bare in mind that batting average is also context neutral, so this shortcoming isn’t exclusive to WAR). I don’t think that context neutrality makes WAR a garbage stat, it just means that it is not the be all end all stat as it is sometimes portrayed.

          Anyway, you can argue that Morales was more valuable than Tabata, but I’d like to hear a positive argument for it, not just “WAR is stupid.”

    • swampirate

      I don’t get it.. Why “MUST” they spend that money on someone? Does Morales make them better than Lambo/Sanchez ? I don’t know that. I don’t think Morales makes sense. Possibly an Ike Davis trade would make sense but spending on a FA just to spend on a FA makes Zero sense.
      Lambo/Sanchez could provide great value with MORE upside than one of the FA available. WWTBD? The answer is NOT Morales or just spending “AJ Money” just to spend it.

    • http://www.facebook.com/bill.kline.547 Bill Kline

      No Morales. It isn’t worth it. His stats aren’t worthy of both the money and loss of draft pick.

  • https://profiles.google.com/115522615427589477970 Mike C.

    another excellent article Tim!
    would love extensions for our own kids like Marte, Polanco etc.

    Btw, can you list the Pirates players represented by Boras?
    at least I’ll know who to NOT get too attached too :)

    I’ve been thinking for a while these extensions to young guys is sort of the new market inefficiency.
    ppl and GMs have loved the “proven” veterans for a while and scared of “unproven” rookies.
    One thing is clear now,
    Vets are PROVEN they will only decline after 30.
    sure there r the occasional rookie “busts”, but rarely after they’ve shown results for 2-3 years.
    and I’d take the random chance of that with a couple rooks + cheaper long term contracts than bloated contracts that offer only declining value.

    • impliedi

      “Btw, can you list the Pirates players represented by Boras?
      at least I’ll know who to NOT get too attached too :)”

      I believe it’s just Alvarez, Cole and Josh Bell.

      Don’t forget that many of the guys who come up in “The Pirates should just go after _______” posts are Boras clients as well, including Kendrys Morales and Stephen Drew, being just 2 of them….

  • skliesen

    This is where AL teams have a distinct advantage over NL teams. The DH rule allows for them to take a risk on a player in his 30′s losing some of his speed and agility, while still having a good bat. It’s not an even playing field the NL plays on for retaining guys like McCann, Fielder or Pujols, just to name a few. I expect Alvarez to be suiting up for an AL team and not playing 1B for the Pirates when he’s in his early 30′s.

    • http://www.facebook.com/stephen.brooks.581 Stephen Brooks

      The ten years-ago me would crucify the now-me for saying this, but the NL should just go ahead and adopt the DH in the next CBA. I would prefer the AL drop it, but that’s not happening, and the inequality is an issue. The talent drain from NL to AL is real.

      • stickyweb

        I’ve lost all respect for you Stephen and will never read another comment of yours. :-)

        Seriously someone’s gonna have to point to a contract other than Fielder’s or Pujols’ to convince me the NL teams are “missing out” on this type of player. I’d say their “lucking out” instead. Maybe McCann’s will be worth it for the duration. We’ll see.

      • skliesen

        I have the solution for both sides. I call it the Hybrid DH.

        Play innings 1-6 w/DH, like AL games. Starting in 7th inning, revert to NL rule for rest of game. For P to stay in game he has to hit in spot in lineup occupied by DH. And for DH to remain in game he has to play in field, with P doing a double switch w position player taken by DH.

        It has all the best aspects of NL and AL game. Majority of game is played w/out rally killing SP having to hit, and the end of game strategy we love in NL games is maintained.

        Seriously, what’s not to like about this concept?

        • BigB2323

          That’s not bad. Might lead to 26 man rosters though lol

      • emjayinTN

        The DH means an “extra” guy, and in most cases a very expensive extra because this guy is usually a middle-of-the-Order hitter. So for the Pirates that would mean the difference between a utility guy getting $500K to possibly $3 mil, to a guy getting from $3 mil to $15 mil. Just another benefit for the “Haves” and another nail in the coffin of the “Have Nots”. In the NL, that guy is usually a defensive plus such as Barmes; in the AL it is usually a guy who carries a glove to ward off mosquito’s.

  • glassers

    I absolutely agree with you regarding Marte . I think Alveraz will go for the money and I would think the Pirates would consider trading him down the road a year or so before that happens . I still like a Walker extension since he can also play third . There are a lot of fans who are at this point disappointed with the Pirates off season activities (or lack of) and I am one of them . Understanding that there is still another two months or so before the season starts there has been little improvement to this team ( for what ever reasons ) . I thought they would have accomplished more coming off a winning season after 20 years of losing with an energized fan base . This has been an on going debate over on the PMB . The good thing is there’s 21 days to the first Spring training game .

  • gregenstein

    Tim – You have research to back up everything you say, and then you drop lines like “because he’s a Boras client” into the mix. I know Boras’ reputation, but it is really him, or do the clients come to him first and say, “I’, going to be a FA. Show me the money!” ?

    Is there any true way to tell how many Boras clients stay and how many end up going to free agency as soon as possible? Or even compare that to whatever the average for the industry is?

    • https://profiles.google.com/101510909979106143098 David Lewis

      I don’t think the implication is that Boras doesn’t allow his clients to sign extensions, as much as the player who signs with Boras is not typically the kind of guy who’s looking to limit his payday by only negotiating an extension with his current team.

    • http://www.piratesprospects.com/author/admin Tim Williams

      I think it’s a mixture of both. Boras goes after the top dollar, and guys who sign with Boras are signing with him to get the top dollar. It’s not like these are random assignments or mistakes. There’s a reason players become Boras clients.

      MLBTR has an extension tracker that shows the agents for each deal. Here are the guys who have signed an extension with less than six years of service time:

      http://transactions.mlbtraderumors.com/widget/extension-tracker&link=true&widget=true&EXT_year_constraint=1&EXT_amount_constraint=1&EXT_options_constraint=1&EXT_serviceTimeLEQ=6

      There’s only nine Boras clients since 2008, and two of those deals didn’t buy out control of any free agent years. Some of the deals were close to free agent value (Jared Weaver, Elvis Andrus). Some of the deals got a year or two of free agency for a good price. So it’s not impossible. But if you’re going to lean one way, it’s best to lean towards the impossible when dealing with Boras and contract extensions.

  • impliedi

    Great article, Tim! One more thing to add to Marte: don’t underestimate the Clemente factor. Like Tabata before him, the guarantee of playing for Clemente’s team for the bulk of his career, might be enough of an interest to get Marte to the table a bit earlier than many others. I’m not saying it’s a huge reason or that the Pirates are going to be able to reduce the contract by millions because of it, but it might be the starting point him to listen to extension talks.

  • Andrew

    When the two points of reference are McCutchen and Tabata the dollar amount could vary widely, but I would like to see a little more from Marte. He cannot keep supplementing his OBP by getting hit, and while he should have a higher than average BABIP, .363 is not sustainable especially for someone who struggle with pitch recognition. I love what he brings but he has some flaws that are worrisome.

    And Mercer, I would not have even considered him an extension candidate, (which Tim really didn’t) I more interested to see how his defense holds up in 2014.

  • Cato the Elder

    Cue the extend- Neil-Walker banter.

    On another note, I’ve been all about extending Marte ASAP, but I think I’ve started to cool on the idea (at least for this offseason). I’d almost certainly still like to extend him, but I think this season will provide a lot of valuable information. Can he maintain his OBP by way of a high BABIP and a lot of HBP? Can he stay healthy getting hit so often? Is his defense as good as last year suggests (2 full seasons of UZR is more informative than 1)? And what do we actually have in Polanco?

    I’m pretty optimistic about all of those questions. I’m slightly concerned about the BA/OBP, but insofar as I think that if it were to regress this season the Pirates might be able to save some money by waiting and signing him next offseason. In other words, other than pacifying the fanbase I don’t know if there is really much to be gained by extending Marte this offseason rather than next offseason.

    • Kevin_Young

      Couldn’t agree more. Plus you add in the wealth of OF prospects behind him. However, I will say that extending him doesn’t mean we couldn’t still decide to deal him if we become concerned.

  • leadoff

    The Pirate system is to breed players not buy them, if you follow their minor league teams then you know they are trying to build a plug-in system. Spending money on minor league scouts and management makes a lot more sense to me than buying some over the hill player that is not much better if better at all than what they already have. How they spend their money is much more important than how much they spend.

    • piraddict

      Here, here!

      • piraddict

        Or is it “Hear, Hear”?

        • https://profiles.google.com/117072260031604417798 PikeBishop65

          The second as it refers to “I want to hear more”

  • csnumber23

    Great article Tim! I agree completely and hopefully they look in to extending Marte during the season, assuming he is producing. He made huge improvements from the 2 months in 12 to last year. I expect more improvements this year. The only thing that concerns me is the injuries with the way he plays and how often he gets hit. If he is anywhere close to the WAR he was last year ( I actually think he will be even higher) then next off season for sure he needs to be extended.

    I would also hope they will at least take a shot at extending Pedro, even though it’s unlikely. Give it a shot and after 15 if you can’t, then trade him for a huge return.

  • piraddict

    I would like to what the correlation coefficient is between total salary and wins procured (scale from -1 to 1). My guess is that it’s closer to zero than one, meaning that the amount of money you spend on payroll is only a small factor contributing to success, not the overwhelming factor that many fans presuppose. I am pretty busy right now so if someone else wants to run the numbers have at it.

    • Gallatin

      I hate all the “spend money to spend money” crap all these disparate Pirate media & fans are always screaming about. It’s just uneducated stuff by people who don’t read and comprend sites like this one.

      Pirate management is cutting edge these days, and cutting edge right now says you don’t have to spend much to win. If you can’t keep up with the Yankees & Dodgers, trying too will just end up in failure. A team like the Pirates have to do it a different way.

      And the different way works. It’s more like the College game, scouting and development is everything, and after 5 or 6 years you move on to the next guy you scouted and developed. If you run a good system, and make good decisions, the “window” never really closes.

      So I am an extend don’t buy kinda guy. Unless you are getting an undervalued player like Martin. I believe you extend young players to buy out free agent years into the early 30′s.

      Now that we extended Morton, which was a really great move IMO, just don’t see any other good candidates right now.

      Boras clients are a no-go traditionally so we ain’t seeing deals for Alverez & Cole. Marte’s injury potential scares me, need to see a complete season from him 1st. Walker is too much of a risk with age and injuries. The rest are too unproven right now.

      I say the Bucs should save their money and try to extend one or two of Polanco, Tallion. Glasnow, Hansen Types once they prove themselves.

  • piraddict

    I like the general idea Tim, but none of the players you mentioned have really merited extension yet. I’d like to see significant improvements in offensive performance from all mentioned before I would do a deal. And some will improve enough to merit extension I think. As an example Clemente didn’t really emerge as a superstar until his mid twenties when he had been in the League for four or five years. I think that might happen with Marte. I hope so, we’ll see.

    That said as always I prefer spending money on the development system, finding and developing the next Polanco. This is the most cost effective way to acquire talent.

    • Andrew

      It is around .18, in the linked article if you go to the comments there is another article link, by several economist who found it to .176 for the time period preceding the period Jeff Sullivan looked at.

      http://www.fangraphs.com/blogs/the-real-market-inefficiency/

      This is one area I disagree with Tim and most Pirates’ fans; remember that is just a correlation, it does not address the issue of causality. Is there a link between payroll and wins because good team’s player earn more in arbitration and are extended more often or is it because teams purchase several free agent at top dollar and then win?

      • piraddict

        Thanks for the reference Andrew, fascinating article! If the R squared has the normal statistical meaning of coefficient of determination than one way to interpret the result is that spending on higher salaries only explains 18% of why a team might win. The other 82% should be attributed to something else (smart management, good players regardless of salary, luck, …).

      • Cato the Elder

        I’m not sure I understand the nature of your disagreement with Tim and most Pirate fans, or I think you may be reading too much into the title – where the emphasis lies on the “this” and not the “need to spend money.”

        • Andrew

          The disagreement is nothing to do with the article. It is over the magnitude of the revenue inequity in the major league baseball and how it supposedly puts teams at a vast disadvantage. Anytime there is a big free agent signing or an $100 million dollar extension the complaints follow on Pirates blog’s about the how the MLB is structured to benefit the Yankees and perpetually punish lower revenue teams.

          Tim has written a few articles on the topic, I think the first Pirates prospect article I read was when the Steelers won the Super Bowl in 2009, and Tim lamented how much fairer the NFL is compared to baseball. I am sympathetic to the argument but dispute the magnitude of the effect, everything I have read that looks at competitive balance and link between payroll and wins in baseball finds a small relationship around 18%, between payroll and wins.

          I do not think that baseball system is without flaws and favor marginal changes; abolish free agent compensation, less strict rule on draft slot spending, I just do not think the NFL has a superior economic system. And I do not believe a complete centralization of revenue would even be viable in the MLB due to the dependence of teams on local revenue sources.

  • http://www.facebook.com/ryan.mccullough.1848 Ryan

    Everyone talks like the Pirates have no hope of sustaining a revenue base that will allow them to pay players market value. I’m a season ticket holder, when I decided to buy 2 more seats this year the “select a seat” event had a lot less seats available than the previous year. Attendance should be up in 2014 and ticket prices are up. Management will continue to rise prices over the next 4 seasons as well. The Pirates will not only see increased revenue from the national TV contracts, but also will see an increase in revenue sharing from teams like the Dodgers, Mariners, and Phillies TV contracts.

    Forbes reported that the Pirates have had an operating income 26.8 million dollars on 178 million in revenue in 2012. I think it’s a fair assumption that revenue grew in 2013 and will grow more in 2014. The Pirates aren’t a sad sack like the Rays, the Pirates have a beautiful ballpark in a great location in a city that loves sports.I think the Pirates have a chance to see significant revenue growth with sustained contention.

    I don’t disagree that players in their 30′s face more headwinds than a player in their 20′s, but I think people overstate the decline of 30 year old players. Personally I don’t think having a players age 30-35 isn’t as bad as people are assuming. Guys with OBP skills like Nick Swisher and Jayson Werth remain productive into their latter years, I think a guy like Shin Soo Choo will as well. The key isn’t to avoid players in their 30′s, it’s to go after the guys with the appropriate “old man” skills who can give you production in the near term, and not be worthless in the back end.

    The Pirates shouldn’t just spend to spend, we can all agree that there weren’t many players in this free agent class that would have improved the Pirates at a cost the Pirates could reasonably pay. I think Morales wouldn’t be a terrible addition, but I understand the hesitation about a guy with legit questions about his ability to play 1st. I know the Pirates won’t be able to compete with the Yankees and Dodgers when those teams really want a player, but I don’t think the Pirates have to avoid free agents in their 30′s at all cost.

    • piraddict

      Interesting Ryan! Did Forbes have any information on the club’s balance sheets? I am particularly interested in how much debt they had. Could be a lot of that operating income had to go to pay interest on debt.

      • http://www.facebook.com/ryan.mccullough.1848 Ryan

        http://www.forbes.com/mlb-valuations/list/

        Forbes numbers are estimates, as baseball teams books aren’t public, but the link above estimates 27% of their valuation of 479 million dollars is debt. Using my calculator that works out to 129.33 million dollars. I’m not a business major, but I assume that debt servicing is part of operations. Maybe Tim can elaborate on that point.

        • http://www.facebook.com/ryan.mccullough.1848 Ryan

          Upon further inspection the operating income doesn’t include taxes or interest expenses.

        • piraddict

          Great reference Ryan, thanks! Generally Operating income doesn’t include the cost to finance the business, or income taxes. Don’t know the interest rate on the debt, maybe 8% so perhaps $10MM of the $26.8MM goes to interest. Then the income before tax, maybe $17MM, gets allocated to the partners to pay tax at their own rates. Generally partnerships will distribute enough to cover taxes, so assume a 40% tax rate and the Pirates are left with a little over $10MM after tax profit to fund additional investments at the end of the year.

    • stickyweb

      Ryan, your first sentence was “Everyone talks like the Pirates have no hope of sustaining a revenue base that will allow them to pay players market value.”

      Depends on your definition of market value. Obviously they were able to pay Martin market value, since they jumped in early and he wasn’t a “leftover”, a la Kendrys or Drew this season.

      But the market value for free agents is usually quoted at either $5, $6 or $7 million/win using WAR. Also typical is assuming replacement level players would win 48 games. So to get to 81 wins, your team needs to generate 33 wins according to WAR. Using the mid point value ($6 mil) that’s a payroll of $198 million. A few thoughts:
      (A) I don’t think anyone thinks the Bucs can have a $198 million payroll even once, let alone sustain it, no matter how many more season tix they sell;
      (B) That’s just for 81 wins and everyone wants the Bucs to win more than that every year;
      (C) Obviously they will always have some 1-3 year players at or near the minimum, so maybe they could occasionally pay market value for a free agent, but certainly not consistently;
      (D) If they “miss” on a BIG free agent, they’re screwed for the duration of the contract. They may be able to “miss” on a mid level signing (equivalent to Martin or Liriano dollar wise), but probably can’t afford more than one “miss” there either.

  • https://profiles.google.com/105668650510920614054 Brian Bernard

    Tim,
    I agree that historically Boras clients are unlikely to sign, but in my opinion I believe in Pedro Alvarez -apparently- a little more than most. I’ve thought him a humble man with usually an honest and thankful appreciation for everything the organization has done for him.
    That being the case, let us assume that he has some say in the decision to consider a fair extension proposal from the team. As you’ve done many times can you provide a comp for what a fair Alvarez type extension would look like?
    As players go, I’m not sure that Pedro measures evenly with the Freeman deal but I would assume it’s in the ball park but less as Pedro’s not as polished a hitter, more brutal slugger. However he plays a more premium position, as you’ve noted with first basemen being valued less before.
    So, would a 6 year 90 million deal look good on the bull???

  • jon6er

    Great article and it also shows why Scott Boras last name is spelled wrong. It should be Boor-ASS!

  • AlvarezRiverBall

    Today on MLB Radio Inside Pitch a caller asked what kind of contract it would take the Pirates to extend Alvarez. Jim Bowden answered that Pirates fans should just sit back and enjoy Pedro’s next two seasons because there is “Zero” chance he gets resigned by the Pirates and that they will more than likely trade him after the 2015 season.

  • Pie Rat

    Boras has overplayed his cards lately. His current free agents will probably have to sign offers below what the QO was. These players will have to crawl back to their original teams and take what they can get if they want to play this year. Also the teams they were associated with had to move on. The services of these players aren’t as valuable anymore. Even if the Pirates had offered Burnett the QO and he declined it, they couldn’t wait until Feb to see if they could still sign him. Even if the Pirates could afford the QO at that time, they can afford it less now.

  • emjayinTN

    Tim: Excellent article, and I have my favorites that I have already spouted off about in previous offerings-

    1. Andrew McCutchen – We have paid him $6.2 mil so far in his career and his Value using WAR has returned $125 mil. His WAR numbers from 2009 thru 2013 – 3.4, 3.5, 5.4, 6.8, 8.2. Not offering an extension to his current deal borders on criminal – 5 years/$101 mil total incl a $6 mil signing bonus.

    2. Starling Marte – 1 year of MLB Service and was selected as the 6th Best LF in the game by MLB Network, and only entering his Age 25 season. 6 Years/$32 mil incl a $2 mil bonus, and a Club Option for $12 mil for his age 31 season.

    3. Neil Walker – Selected by MLB Network as the 8th Best 2B in the game. His WAR Numbers the last 3 seasons are 2.6, 2.6, 2.7 which is value of between $14 mil and $15 mil per year based on the current WAR Value of $5.5 mil per point. Paid about $5 mil so far by the Pirates and a Value return of $42 mil+.

    Cannot understand your reasoning about some of this about players in their 30′s (supposedly declining years); players who have had injuries; but then a positive about signing Charlie Morton thru his age 32 season? McCutchen has never had a serious injury – great body-type, work ethic, MVP, and shows no signs of back-up. Not only a tremendously productive presence in the middle of the order, but a PR Goldmine at a time when the Pirates needed it most, and the Pirates should have an eye on the expiration of their TV contract with ROOT in 2018/19. This is a HOF lock if he continues at this pace, and I think the competition for the Pittsburgh market is going to skyrocket in the next few years. Walker has played 159, 129, 133 games the past three years so he missed an average of 22 games a year. CH loves to give guys a break, so he is probably happy to get 150 games a year max. Walker is also a PR Goldmine for his hometown team. Morton missed half of the 2013 season and more than half of the 2012 season due to TJ Surgery, and between Oct 2011 to May 2012 he was rehabbing from Hip Surgery. Don’t get me wrong, I like CM and hope he will be the pitcher we saw in the second half of the 2013 season, but he has had his issues also. In the meantime, extend ‘Cutch, long-term Marte and Walker, and develop an offer for Pedro Alvarez – I would rather make the effort rather than just ASSUME he will not accept.

  • rburgh

    Brett Wallace DFA by the Astros today. He’s already established he can be what we hope Lambo might be. Certainly worth a shot.