It took about a month longer than it has in the recent past, but The Associated Press finally gave us their yearly gift and reported the official year-end payrolls for 2022—both the Labor Relations Department and Competitive Balance Tax varieties.
This is one of my favorite and most looked forward to reports of the year, as I get to compare my estimates to actual verified figures.
Back in October, I put to print my estimated payrolls of $60,925,548 (LRD) and $73,959,797 (CBT). Just how did these end up comparing?
First of all, I want to point out some quick adjustments, at least to the CBT calculation.
The AP’s report gave the official benefits number that is accounted for in the total—$16,016,707. My estimate was based on a $16,000,000 placeholder, so I added $16,707 to the final amount. Also, between October and now it was brought to my attention that there was an unreported bonus that the Pittsburgh Pirates had on their books, so I added another $717,213. While I’m not adding that to the LRD number, as I’m not sure if it belongs there or not as of yet, both these extra amounts brought my projected CBT total to $74,693,717.
As for the official figures, the AP has the Pirates with a LRD payroll of $61,196,070 and a CBT payroll of $75,399,389. I decided to compare my work to that of the other industry standards in this space—Spotrac and Roster Resource—and here is what I came up with:
| Labor Relations Department | |||
| Source | Final | Difference | % Diff |
| AP | 61,196,070 | ||
| Spotrac | 66,184,032 | 4,987,962 | 7.54% |
| Roster Resource | 58,707,802 | (2,488,268) | -4.24% |
| Pirates Prospects | 60,925,548 | (270,522) | -0.44% |
| Competitive Balance Tax | |||
| Source | Final | Difference | % Diff |
| AP | 75,399,389 | ||
| Spotrac | 73,807,070 | (1,592,319) | -2.16% |
| Roster Resource | 74,641,176 | (758,213) | -1.02% |
| Pirates Prospects | 74,693,717 | (705,672) | -0.94% |
As you can see, my final $270,522 difference in the LRD calculation significantly bested both, while we were all much closer on the final CBT calculations. Spotrac was still including the $10 million figure for He Who Shall Not Be Named, so they should be totally omitted from the conversation, as I’m not sure how they even came as close as they did.
But I digress…
In my opinion, you’re in the right place for your payroll source. I take pride in my work, and I love to see the validation in that paying off.
As for the bits I honestly couldn’t care less about but need to relay anyway:
The Pirates ranked 28th and 29th in LRD and CBT totals, respectively, finishing in front of only the Baltimore Orioles and Oakland Athletics. Year-over-year, the Pirates increased a total of $13,587,248 ($61,812,141 to $75,399,389) in CBT dollars, which is part of trend I actually do find interesting.
As you can see from the figures below, CBT spending skyrocketed from 2021 to 2022:
| 2021 | 2022 | Difference | |
| NYM | 207,728,776 | 299,842,423 | 92,113,647 |
| NYY | 208,418,540 | 267,753,417 | 59,334,877 |
| COL | 117,210,393 | 172,251,358 | 55,040,965 |
| TEX | 111,309,808 | 160,505,146 | 49,195,338 |
| DET | 103,879,667 | 152,359,282 | 48,479,615 |
| SEA | 102,679,174 | 145,137,950 | 42,458,776 |
| ATL | 172,630,704 | 214,092,505 | 41,461,801 |
| CHW | 177,837,827 | 215,631,300 | 37,793,473 |
| TBR | 89,833,652 | 125,261,660 | 35,428,008 |
| PHI | 209,370,501 | 244,413,284 | 35,042,783 |
| TOR | 166,054,167 | 198,543,787 | 32,489,620 |
| MIA | 82,332,229 | 114,348,173 | 32,015,944 |
| CLE | 62,212,834 | 91,592,881 | 29,380,047 |
| BOS | 207,640,471 | 236,149,678 | 28,509,207 |
| MIN | 145,511,247 | 173,198,565 | 27,687,318 |
| MIL | 131,990,136 | 153,006,350 | 21,016,214 |
| SDP | 216,467,691 | 235,082,125 | 18,614,434 |
| CHC | 165,665,645 | 180,512,338 | 14,846,693 |
| PIT | 61,812,141 | 75,399,389 | 13,587,248 |
| ARI | 109,387,132 | 118,290,204 | 8,903,072 |
| LAD | 285,599,944 | 293,330,382 | 7,730,438 |
| BAL | 76,348,794 | 82,898,023 | 6,549,229 |
| KCR | 108,026,769 | 114,324,301 | 6,297,532 |
| HOU | 206,641,209 | 210,686,230 | 4,045,021 |
| SFG | 173,481,453 | 171,423,107 | (2,058,346) |
| LAA | 198,984,916 | 193,269,044 | (5,715,872) |
| WAS | 174,582,117 | 160,500,353 | (14,081,764) |
| CIN | 144,248,891 | 125,021,497 | (19,227,394) |
| STL | 198,350,234 | 174,439,667 | (23,910,567) |
| OAK | 102,225,663 | 65,325,365 | (36,900,298) |
| 4,518,462,725 | 5,164,589,784 | 646,127,059 |
This is why the players’ battle for higher CBT thresholds was so important, as spending rose in conjunction with the spending limits.
Of course, a lot of the heavy lifting was done pre-lockout, so 2022 may not be the best barometer; however, spending always goes up directly after a new agreement and labor peace is assured for a few years, and so far this offseason has not proven otherwise.
It’s hard to imagine final totals going down from 2022, and it will be interesting to watch over the next few years if the rising tide continues to lift all boats.
Offseason Calendar Update
No updates here as of this week.
Pirates Payroll Updates
—To make room for the official signing of Andrew McCutchen, the Pirates designated Miguel Andújar for assignment.
The team had already agreed with Andújar back in November on a $1,525,000 contract. They are tied to that amount no matter what—unless Andújar is outrighted and elects free agency, his right as a player with over three years of service—and that guarantee actually makes him more likely to stick around.
The Baltimore Orioles were recently able to pull off something similar with Ryan O’Hearn—who is close to Andújar in salary, position, and service—after designating him for assignment. Teams were likely weary of taking on such a financial commitment for a depth piece, and the Orioles knew that, also betting that O’Hearn wouldn’t elect free agency and forgo his $1.4M salary. So, they were able to keep him in the organization for depth at the same price while saving a 40-man spot in the process.
That’s very likely the Pirates’ thought process in making this move.
As for payroll implications, I recalled Tucupita Marcano to the active roster and added the immortal Ryan Vilade back, and the payroll went up $645,742 in the process.
—For 2023, the payroll estimate stands at $73,202,372 for the Labor Relations Department, while it’s $89,619,039 for CBT purposes.
A longtime Pirates Prospects reader, Ethan has been covering payroll, transactions, and rules in-depth since 2018 and dabbling in these topics for as long as he can remember. He started writing about the Pirates at The Point of Pittsburgh before moving over to Pirates Prospects at the start of the 2019 season.
Always a lover of numbers and finding an answer, Ethan much prefers diving into these topics over what’s actually happening on the field. These under and often incorrectly covered topics are truly his passion, and he does his best to educate fans on subjects they may not always understand, but are important nonetheless.
When he’s not updating his beloved spreadsheets, Ethan works full-time as an accountant, while being a dad to two young daughters and watching too many movies and TV shows at night.
Every year I ask this……this is 40-man payroll not 26-man. Come Opening Day, it seems other Media report the 26-man which I find more useful to compare actual wins on the field vs luxury tax reporting. Also where did AP get their numbers and why are they the basis?
I don’t mean this to be snarky, but I am tracking 40-man expenditures because that’s what is laid out in the CBA. Tracking anything else because it may make more or less sense…wouldn’t make any sense.
And sure, 26-man is the popular thing to report on Opening Day; however, I’m not sure the league is even tracking that and it’s not what we’re talking about here. The CBT calculations are agreed upon in the CBA and those are what are being tracked. The second payroll is one reported by teams to the Labor Relations Department, and while it’s tracked slightly different, the idea is still the same–track what is being tracked, not what I think should be tracked.
And while I can’t speak for the sides, I’d say that it’s the 40-man roster because many more players than just the Opening Day roster will be used, and you’re still paying minor leaguers and outrighted players a salary.
I am tracking those figures and other sites aren’t, and I’m coming closer. They aren’t super material, but it’s not nothing either.
Finally, the AP is the important figure because all of us are simply tracking an estimate; however, the AP is reporting totals from the league. So, they are the real amounts, not just guesses.
Feel free to respond with any other questions.
Not meant to be snarky, but as a fan I value the 26-man numbers. It doesn’t make a huge difference but why give Nutting (or any owner) credit for $73M in OD payroll, when that’s counting 14 other guys who aren’t even in Pirates uniforms, and are playing or injured in other minor league towns. Just two ways to look at it. Thanks for your work.
Spending actually rose commensurate with MLB revenues, which were $1.3B higher in 2022 versus 2021 and finally surpassing pre-pandemic levels. I don’t think the CBT thresholds had anything to do with it.
Ethan, when can we expect Liberty Media to release their financial results from last season? This gives us an idea how much profit BN really makes.
Well I think I remember seeing something not that long ago, maybe Q3? That would encapsulate most of, if not all of the season if they do calendar year.
Also, between The Battery (I think) and playoffs, I’d assume Atlanta is doing better, but who knows.
Sorry, not Ethan, but probably middle to end of February. It’s a good test of reasonableness for the Forbes estimates, which can be used to make a pseudo operating statement. I’m more interested to see their debt levels and the associated costs to service that debt. I am also curious as to their working capital requirements.
You should toot your own horn Ethan. Very impressive work. If you’re not getting paid in the field of finance, you should be.
In looking at the current numbers compared to ‘21 & ‘22, it appears Pirates may have room for one or two more above minimum wage bullpen additions.
Thanks, I don’t think I find it inappropriate, as long as I’m not too over the top.
I work hard to try and figure out as much as I can and get as close as I can, so it really is awesome when I come that close. And I want to make people aware, because quite frankly, there’s no reason to cite Spotrac (as everyone does) at least locally, because I have it. I understand I probably should be coming closer, as I focus on one team and they 30, but things like including a player who’s in jail or completely missing Quintana are kind of unacceptable.
However, I also blame the user for not looking at the detail and discerning that for themselves.
Also, as the bio says, I’m an accountant, so is that close enough?
Guilty of not reading your bio. Sorry. And yes Accounting is most certainly part of Finance, no matter what hoity toity CFO’s say. 😎
Great job, Ethan – you are officially my go to guy when it comes to Pirates payroll from this point forward.
Great work sir. Truly impressive.
wonder if travis is about to announce surprise logo change? now is good marker to trigger a fresh new chapter for the organization
an easy change would be to start marketing the 1990 logo again and encourage the whole team to grow mustashes like Wehner, Jeff King and RJ Reynolds
Nah, give me the 60s mustard with Stargell Stars on a pillbox cap
I think you mean late ’70s. I prefer the ’60s sleeveless with black undershirt.
Nope. marry the 60s with the 70s pillbox
Oh, I see. You meant the mustard cap, which I also like.
I like that too
Anything is better than what they’ve had since 2001