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Friday, February 8, 2013

Drenonomics | The Longoria Window | Kansas City Royals

Tyler Drenon

Average payroll of playoff teams
Kansas City Royals payroll
Average wins for playoff teams 
Kansas City Royals wins  

Kansas City Royals projected 2013 payroll*: 
*According to Yahoo's Jeff Passan

Putting together a competitor in a small market is manifestly easier said than done. One of the major focal points in my Longoria Window scribblings has been payroll efficiency. While mid- and major-market teams can gain from early extensions (in order to drop big dollars elsewhere,) their small-market counterparts stand to gain the most. Dayton Moore has been attempting to employ the thrifty convictions that have led the Rays' front office to sign blue-ribbon prospects like Evan Longoria (in 2008) and Matt Moore (in 2011) on the cheap. So far, the Royals GM has been able to secure several of his young players with relatively punctual extensions. While his roster may not be striking fear into the AL Central yet, the grand scheme seems to be falling into place for an opportunity to compete in the near future. That is thanks, in part, to the financial flexibility these extensions have allowed Moore. Of course, he has subsequently cashed in his nest egg for the shabby likes of Ervin Santana and Jeff Francoeur.

Moore's in-house deals with Alcides Escobar and Salvador Perez were considered premature by some, and they may have been. Escobar had yet to prove he could hit at the big league level, but Moore may have been more inclined to extend him early because of his stature in the Zack Greinke trade. Regardless of the initial response to the deal, it looks like a solid investment right now. Some luck must inevitably play a part in every successful contract. 

Perez was a slightly safer option, and the 23 year-old's extension (in addition to others) may end up being commendable enough to get Dayton Moore an extension of his own. 

The Rays set out to strike gold again with Wade Davis in 2011. The deal seemed to further their reputation as innovators in payroll choreography.

Well, this one turned out to be the runt of the litter. Davis wasn't quite on the same level as the elite players the Rays had locked down before him. And therein lies the risk in such extensions: They have a structure forged in guesswork. He may still develop into a solid starting pitcher, but his pact with the Rays now handcuffs the Royals.

They have him at a reasonable $2.8MM for 2013 and $4.8MM in 2014. The following year is when things will get cumbersome, if Davis maintains his current level of performance. He's not an awful pitcher, but the Royals can't afford to pay a back-end starter (or even a really good reliever) $7MM to $10MM. Or at least they shouldn't. His contract forces the Royals to keep him in the rotation and hope he can earn those chunky options. Otherwise, they either have to cut bait on a major part of the Myers cacophony, or they stomach the quasi-sunken cost and stubbornly run Davis out there (like they have with Luke Hochevar.) If they decide to decline his 2015 option, he'll become a free agent; and many teams would value him in a relief capacity.

Andrew Friedman may have gotten a mulligan in swapping Davis' contract for Odorizzi. You can count on a much more modest extension for Odo, if they decide to give him one at all. Davis' deal was drafted for a starting pitcher well on his way to prominence. Surely, Tampa won't make the same mistake again. Kansas City and Tampa Bay have similar fiscal limitations and neither can afford to make long-term plans for expensive relief pitching. Sadly enough, Davis (as is) will be a huge upgrade for the Royals even if he isn't pitching from his most suitable role. Regardless, the future is muddy. 

If Longoria's contract is the window, Davis' is the bird guts on the glass.

The initial response to this deal (mostly outside KC) was confusion:

Who's that guy? 
Never heard of 'm.
Stupid Royals.
Well, screw you, ya hypothetical asshole!

The contract has since drawn some lofty praise as:

"Baseball's best"

And then there's Ned Yost's apparent 48-hour scouting marathon:

"The first time I laid eyes on Sal, it took me about two days to realize he was special."

The contract has almost no risk. Which is insane considering he is one of the game's best young players at a pivotal position. Perez is never guaranteed more than $2MM in the deal and the team will avoid the arbitration process with him completely. 

Here's how the contract breaks down:

Contract Value
                     *Team Option

It's hard to imagine a scenario in which Perez isn't worth these options. His defense alone is enough to justify the deal. And the Royals have designs on Perez being featured in the heart of their future lineup. This extension will also aid Moore in giving Perez some decent pitchers to catch in the future.

Altheedayth Ethcobarrrrrrrrrr!
Escobar's extension was finalized before his long-term presence was indisputable, but they did avoid jumping through the hoops of arbitration in the process. A fringe positive on its own. The contract was never the topic of much scrutiny, because the risk involved is peripheral. Escobar is only assured $10MM over the first four years. He's already shown he can live up to the gig at short and it seems like an outside chance that he fails to live up to the bantamweight team options that rudder his contract.

Shortstop and catcher are two of the most challenging positions to fill and the Royals have done so at a premium. Some of that may be due to luck, but luck has been long overdue in KC. While Perez and Escobar are known for their prowess on defense, both of them have also been handling the bat well for the Royals. Escobar's starring role in the Greinke trade may very well have prompted the early extension, but it seems to have paid off (to a certain degree.) Obviously, Greinke wasn't getting $147MM from David Glass. So, in that regard, they seem to have faired somewhat commendably in the tradeoff. And Escobar has been the most productive of the players in the Royals severance package. They aren't committed to him for any more than $3MM and have cheap team options through 2017 (his age 30 season.) The contract is a bargain even if he has plateaued. Let's hope he's just getting started. 

Scott Boras. 
A team-friendly extension is unlikely. 
Even though Hosmer struggled last year, Boras may be looking to break some more records with his dynamic, young client. After all, the higher the player's salary, the higher the percentage of it he can choke down to fester in the subhuman cavern that imprisons his putrescent, wrinkled soul. And Hosmer will be content with the arrangement, because he can buy more dirt bikes or Monsters or whatever guys like him are into. Let's just be glad he likes baseball and he happens to be pretty good at it. Boras may be looking to the Longoria extension's cousin on the senior circuit for inspiration. Ryan Braun signed the most lucrative contract ever for a "zero-plus" player (<1 year in MLB.) 8 years $45MM.

The main difference wih Hosmer is: he's not zero-plus anymore. His service time sits at 1.146. That reads 1 year and 146 days. KC may not have managed to dodge Super 2 status with Hosmer, but it seems as though they tried. Their first baseman acquired a full year of service time in 2012. That makes the remainder (or his 2011 service time,) the exact same as the Super 2 cut-off in 2011. 146 days. Theoretically, the Royals waited long enough, but obviously the parameters of Super 2 are transient. Did the team not know this? Did they not care/understand? How is a team supposed to plan around this mutant? There are millions of dollars on the line!

Here are the last three Super 2 cut-offs:


This would make a lot more sense if the the player's final Super 2 status was earned in the first season that player acquired service time. At least then the team would have an idea of where they stand with their young players.

Anyway, Hosmer will get expensive sooner than later. He's eligible to hit the panels starting next year and through 2018. 

Hosmer's BABIP is likely to rebound from the bogus .255 he was subjected to in 2012. He has no reason to look into an extension now, as his value is down and Boras has surely filled his head with some irrational numbers (and I don't mean Pi, smartass.) If I had to guess at the value he would target, I'd start with the equivalent of 8 years $45,000,001. 

Moose's camp will almost certainly profit from the strides he made defensively. While his bat is still coming along, he gave us several eye-popping highlights at third last year. If there were a more widely accepted fielding metric, Moustakas may have even overthrown Adrian Beltre as the reigning AL Gold Glover at third. He deserved it if you buy into UZR as a proper yardstick for fielding value:

Anyhow, the team has profited from Moose ( and not just the styrofoam antlers.) He was called up about a month after Hosmer, putting him outside of even the most liberal Super 2 designation. This means the team will avoid the extra year of arbitration raises with their third baseman. Both players will be under team control until 2018, but Hoz will be taking the checks at Ruth's Chris. For now, Moustakas (and Hosmer) are suspended in the Boras vacuum.

Gordon will make $31.5MM over the next 3 years. Not bad for the guy who ranks 5th OVERALL in WAR over the last 2 years. Just for fun, that's better than $100MM guys like: Joey Votto, Matt Kemp, Prince Fielder, Albert Pujols and Josh Hamilton...just to name a few. Not to mention his league-best 37 outfield assists over that time. Or the back-to-back Gold Gloves.

He has been a top ten player over the last two years, no matter the metric.

It's hard to project what the market would've been had the Royals let him slip away. One thing is certain: It would've been pricey. The team holds a $12.5MM option for 2016 (his age 32 season) that is practically already exercised. Bubba Starling's game may be spilling over into the Majors by then, so the Royals' longview may not have room for Gordon's swelling net worth any further than this contract takes them. Depending on rates of development, Jorge Bonifacio and Brian Fletcher may also be ready to step in (and perhaps, Cheslor Cuthbert with a move to a corner outfield spot.) 

For now, Gordon monitors left field. Well. 

And if he can permanently nestle somewhere in the batting order, all the guesswork may finally be over. 

It wouldn't be surprising if Cain got a longer audition than most soon-to-be 27 year-old center fielders. The Royals will likely protect the value of their return from the Brewers by giving Cain a multitude of opportunities to blossom. 2013 will be a metronome, visibly pacing his development. He is still on the outskirts of extension territory, but 2013 could be instrumental to his financial future. He won't reach arbitration until 2015, as he sits at 1.074 (1 year 74 days.)This may be the first scenario for the Royals in which the team is the more hesitant party. So in this case, arbitration is the team's safety net. They can allow him to cultivate his technique without being forced into any major decisions (or paydays) through 2018. Hopefully, he stays healthy enough throughout the year for us to see a blanket demonstration of the Lo-Cain Expo.

Billy Ray signed his arbitration-dodging extension in January 2011. He's locked down for 3 more years (if DMGM decides to exercise the more than reasonable $12.5MM 2015 team option.) Moore has shown an aptitude for this brand of extension, but an unlikely source deserves some credit for this one. Gil Meche had just turned down $12.4MM because he didn't think he deserved it. Hence, the Butler extension, including the aforementioned option tacked on the end. Notice any correlation? Surely, that $12,500,000 helped sway the Silver Slugger. Most people would've taken their contracted money with them into the sunset. Especially, if their career had been cut short by gross negligence.

Not Meche.

It would be nice to think Butler will be a Royal long after this deal expires, but if he continues cracking the ash like he has been, he'll get very expensive. He may be typecast as a DH only, but Ryan Howard and CC Sabbathia have proven it: You can still get rich with a gut.

Anyhow, when you watch Country Breakfast suit up in the powder blues for the first half of 2015, think back tenderly of the ultimate altruist, Mr. Gilbert Meche. 

Teams are typically hesitant when it comes to handing out multi-year deals to relievers, but the Royals may benefit from the idea in a few cases. Collins will graduate to the arbitration panels next year, as the bullpen typically does. That annual back-and-forth may be a small part of what makes relievers so volatile. In any event, Collins may just be scratching the surface of his value on the field and on his check stub.

On that surface, it may seem as though Collins simply maintained the status quo in 2012, but his sabremetric numbers suggest otherwise:

His BABIP and HR/FB seem to hint at a little bad luck. If Collins can further tap into his reservoir of talent, the team may see some worth in bypassing arbitration on a somewhat short-term flier. 

Holland's path through arbitration will likely have the same arc as his physiologically succinct 'pen mate, but the Royals may be more predisposed to sign their closer to an extension (if he can definitively claim the role.) His agent may have aspirations for a deal like Joakim Soria's 2008 lock down. It was backloaded with team options as a safe-ish vehicle for stability. Holland has some work to do to get there. But on the other hand, Holland & Co. may be content to play the game and face off with the Royals for the next few years. 

The right-hander's FIP suggests that uncontrollable variables (like his .346 BABIP) were to blame for his slight regression, but he did have some command issues (4.57 BB/9.) If he can work out the kinks, he may cement himself as Kansas City's curtain man.

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Other installments: ALCentral  &  ALWest  &  ALEast

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