The Major League Baseball draft doesn’t allow you to go over your total bonus pool without some extreme penalties. These include the loss of future draft picks, as well as a 100 percent tax on the overage. If there was any team wondering if an individual player was worth those penalties, all they need to do is look at what happened with the Pittsburgh Pirates and Mark Appel.
Appel was the top prospect in the 2012 draft, but fell to the Pirates at number eight overall due to signability concerns. The Pirates took the chance on him, but ended up passing on signing him, since he was demanding a bonus that would have taken them over their bonus pool. If the Pirates would have signed Appel for his demands, they would have lost their first and second round picks in 2013, plus their first and second round picks in 2014, as well as a tax of about $2-3 M extra, depending on how much they would have had to go over the bonus pool.
Instead, they passed and got a compensation pick the next year, while keeping all of their future picks. That compensation pick was used on Austin Meadows, who had an impressive season in 2013. The first and second round picks were used on Reese McGuire and Blake Taylor.
Jonathan Mayo recently released a combined version of the top 100 prospect lists. Appel ranked 21st overall. Meadows was 51st. McGuire was 85th. Some of the individual lists had Appel and Meadows closer together. But even the combined version shows that signing Appel to an over-slot deal would have been a horrible move.
If we look at the trade values for prospects, we get the following values for each player.
Appel – $18.89 M
Meadows – $10.43 M
McGuire – $10.43 M
The Appel decision was pretty much like a trade. The Pirates could have signed Appel, or they could have had five future draft picks. Meadows and McGuire alone have more value than Appel. That doesn’t even consider Blake Taylor, who would be worth $2.1 to $7.3 M, depending on whether he’s considered a Grade B or C prospect. It doesn’t include the first and second round picks in 2014, which will only add more value to the Pirates side. Then there’s the $2-3 M extra in money that the Pirates would have had to pay as a tax to sign Appel. Also, if you bump Meadows up one spot in the rankings and make him a top 50 prospect (he was a top 50 guy on a lot of lists), then you add another $8 M in value.
Appel’s trade value right now is $18.89 M. The Pirates would have had to give up at least $23 M in value from their 2013 picks, along with $2-3 M in taxes, and probably $10 M in value from the 2014 draft when considering how strong the talent is compared to the 2013 group. They would have almost had to pay double what Appel was worth, when you put it in terms of the loss of future prospects.
The decision to draft Appel to begin with really worked out for the Pirates. They had a pre-draft deal with David Dahl, who was a top 100 prospect on Mayo’s list, but came in at number 65. That’s 14 spots lower than Meadows, and the Pirates don’t get Meadows if Appel doesn’t drop to them and force them to pass on Dahl. So it was a smart move to pass on Appel, but it was good fortune that Appel was available and forced them to make such a decision.
Links and Notes
**If you haven’t ordered your copy of the 2014 Prospect Guide, you had better act fast. We’re currently on the last case of books. I say that’s the last case because I don’t think I’ll be ordering more this year. Each year I order the books in bulk through the publisher, which allows me to save several dollars per book, and I pass that savings on to you to keep the price of the book low. You’ll still be able to buy the book from the publisher after I sell my supply, but the bulk discount price won’t be included, which means you’ll be paying $25, plus $3.99 for shipping. Right now you can buy the book for $25 shipped on the products page of the site.