First Pitch: The Narrative About the Pirates Payroll, and Facts About Small Markets

One of the most popular topics in Pittsburgh surrounding the Pirates is Bob Nutting and how much money he should be spending. It’s not a topic you find on this site often. And that isn’t to say that I take the opposite stance of most Pittsburgh media — that approach being that he should spend more and is cheap and only cares about profits. It’s just that I don’t talk about it at all.

I went on a bit of a rant last week on Twitter about this subject, and I’ll bring up the key point of that rant again: the Nutting/payroll topic brings about the worst discussions among Pirates fans. It’s almost like a political discussion. Everyone has their opinions, and no one changes their opinions, even with new data. If you are neutral, or take a nuanced view of the situation where there aren’t just two clear sides, then you are labeled by one side or the other as having an agenda, just because you don’t fully buy in to a specific side.

When you add in the fact that every single discussion about the Pirates inevitably turns to Nutting and payroll, it makes me want to talk about it less. I prefer talking about actual baseball topics. Last night I discussed the reality of MLB and how small market teams face really difficult decisions keeping franchise players. My favorite articles to write are the ones where I break down the changes a prospect made from the point when he entered pro ball to the point when he reached the majors. I’ll talk about the needs of the 2017 rotation, whether the Pirates can sacrifice offense at second base for Josh Harrison’s defense, or modern bullpen usage.

Every topic is going to have some sort of payroll tie-in, but the point when that discussion pivots to the Nutting/payroll discussion is the point when we stop debating baseball with each other, and start attacking each other. When someone disagrees about Gerrit Cole’s value in the rotation, you never hear that they’re an apologist for Gerrit Cole. The same goes for other baseball discussions. You can pick two sides, discuss each side, and avoid accusing the other side of some ulterior motive. That’s impossible with the Nutting/payroll talk. Those discussions immediately become about attacking the person making the argument, rather than debating both sides. That’s not good baseball talk, and it’s part of why I avoid it.

This weekend at PirateFest, however, Frank Coonelly said he was tired of the narrative that the Pirates are more interested in turning a profit than winning. He went as far as calling it offensive, which I’m sure isn’t going to go over well, but at the same time, I could understand how a group of people would be offended constantly being portrayed like an evil organization led by Scrooge McDuck.

Unfortunately, that narrative will live on, probably until the Pirates win a World Series, and maybe even after that. It’s not going to disappear until the Pirates open their books, and probably won’t disappear even if that did happen (it won’t, and that only makes the Pirates like every other organization). The reason the narrative lives on is because we have very few actual facts to go on.

There are some sites that try and figure out the finances of the game. Forbes posts projections each year, although I have never trusted those numbers. Sites will track payroll, including this one, but that’s only one part of an entire operation. But we’ll never really know how much a team makes, what percentage of that they spend on payroll, what they do with the rest, how much is left over in profit, and what happens with that profit. Even if we knew that for one team, we wouldn’t know how it compares to other teams for perspective.

That’s another big reason I don’t write about this. I prefer to discuss a topic when there are actual facts, rather than two sides playing a guessing game and arguing about what they think is probably accurate.

All of this said, there is one thing that drives me nuts about this entire debate, and that’s the idea that the Pirates being “small market” is an excuse. The Pirates are a small market team in baseball. This is designated by MLB’s Collective Bargaining Agreement. They get an extra draft pick each year, and the most spending money in the international market under the new CBA for this designation. If they sign a player with a qualified offer, the draft pick they lose is lower in the draft than the one the Yankees or Dodgers would lose. The Pirates being a small market team is an undeniable fact, and the moment that gets referred to as an excuse or a lie is the moment when one side has refused to accept any facts in this discussion.

Then there’s the issue of how the Pirates compare to other small market teams. The common argument about payroll is that the Pirates are always in the bottom third, even though that makes sense if they’re in the bottom third in market size. The argument is that they don’t even spend comparably to small market teams. So even though I don’t think these facts will help in the discussion, I wanted to compare payrolls across the league, in order to see what each team could spend.

I looked at the Opening Day payrolls according to Cot’s, and found the highest Opening Day total for each team. I also found the average of the five highest payrolls for each team, just in case there was one extreme outlier (Example: Kansas City’s highest payroll was $131.5 M, but their next four were $112.9 M, $92.2 M, $81.9 M, and $75 M). I used Opening Day payrolls because that’s usually the figure that reflects the budget. Teams save more for in-season moves, but the Opening Day payroll is the best way to view their plan for the season. I will note that almost every team had their highest payroll in the last five years, which makes sense due to the rising costs and the new money coming into the game.

Here is the chart featuring the highest Opening Day payrolls for each team.

The figure for the Pirates was heading into the 2016 season. I had the figure at $103 M, although I go into extreme detail that I’m not sure Cot’s could do for all 30 teams. And since all 30 teams would have this disclaimer (and since the difference would only move the Pirates up 2-3 spots), we’ll ignore it.

The Pirates have maxed out so far in the bottom third at one of the final spots. Before adding analysis, let’s also look at the average of the top five payrolls for each team.

One thing I noticed here is that almost every team had their top five payrolls scattered over the 17 year time period I looked at (2000-2016). The Pirates have had their highest payrolls from 2013-2016, which are the years they were contenders. Their fifth highest payroll was in 2001, which was slightly higher than 2012. That’s a side effect of 20 years of losing. If you only look at their last two years, it bumps them up to $95 M, putting them at 23rd. Still the bottom ten.

The reason I wanted to look at these numbers is because I wanted to see what teams in similar markets spend. That’s one of the most exaggerated points right now, with claims that the Indians went well over $100 M to make the World Series (their highest started at $96 M), or that small market teams are now spending $120 M, or other exaggerations.

The first thing I noticed about these numbers is that 13 teams in the league have maxed out at $115 M or less, and half the league has an average of less than $115 M. That’s a huge divide, especially when you have those two teams at the top averaging close to $220 M (the 1% of the baseball world).

The Pirates are low in these, and without having details of their finances, I think they could and should be higher (OMG! Nutting apologist!). I think part of the reason they are lower for their average is because they just recently became contenders. If they continue spending around $100 M, then I think that puts them in a respectable place, ranking near the top of the bottom half in baseball. It’s hard to say that they should be averaging much more than $100 M per year when most teams in similar markets are averaging that or less in their five biggest years.

My takeaway from the numbers is that if the Pirates are trying to contend, and not in a rebuild, then they should be around $100 M in payroll. It’s hard to argue that they can’t afford that much when they’ve spent nearly that much in the two previous years, and are projected to be around that again this year. If they do that consistently, they’ll end up at the top of the bottom third, or the bottom of the middle third, which is respectable when considering their market size.

The bigger takeaway is that the small market designation is very real. It’s hard to look at payroll stats that show teams in Cincinnati, Kansas City, Cleveland, Milwaukee, and Oakland averaging around $100 M or less in their best years, and then expect the Pirates to be spending significantly higher than that amount. Maybe the Pirates could spend a bit more in an individual year ($105 M? $110 M? $115 M?), but they’re still going to end up in the bottom half of the league, and as the numbers from other teams show, they’re probably not going to be able to do this for more than one or two years.

That might be the biggest reason I don’t discuss the Nutting/payroll topic, and why I’m constantly discussing the small market topic. It just seems like payroll is a topic that is blaming the Pirates for being small market, rather than placing the blame on MLB for creating a system that sees such a big divide between the top ten teams and the bottom ten teams. Or even the top five teams ($164 M to $219 M average) and the bottom 15 teams ($112 M or less average). The Pirates are small market, and that’s an MLB problem shared by a lot of other organizations, and it’s much more important than arguing about payroll numbers. The Pirates should be spending comparably to those teams (AKA, they should be expected for at least a $100 M budget in contending years), but expecting them to do more just feels like placing the blame on them for being victims to the system MLB has created.

In summary, I think the Pirates are lower on the above charts because they haven’t been contenders as often as other teams. If they continue contending, they should be able to spend around $100 M, based on what other teams in similar markets have spent. That would put them near the top of the small market teams. But expecting that they should spend more than that on average is blaming the Pirates for an MLB issue, which I think is misguided.

Tomorrow, we go back to the same old actual baseball topics, like how Nick Kingham is following Jameson Taillon’s path returning from Tommy John, and a look at the Triple-A pitching options for the MLB staff.

**Jameson Taillon Ready for the Challenge of Being a Top of the Rotation Starter. Sean McCool talked with Taillon last week about his upcoming role as one of the top starters in the Pirates’ rotation, and his goals for his second full year returning from Tommy John.

**Pirates Hire Gary Varsho and Andrew Lorraine as Pro Scouts. Just so you know the difference, pro scouts are the guys who scout the minor leagues for potential trade additions, or guys who could be good additions in the future, or any other scouting purposes. That’s different from amateur scouts, who look at future draft picks.