Fans see roughly $50 million before the Mets hit the Competitive Balance Tax (CBT) threshold and wonder why they aren’t spending at least up to that level now and possibly going over, since money isn’t really an issue for new owner Steve Cohen. It’s been reported that Cohen is expecting to lose about $400 million in his first two years as the owner. And it’s likely that forecast was made without going over the CBT in his first year.

The easiest thing to do is to throw money at a problem, especially when it’s not your money. But the Mets have made it clear that they want to build a sustainable winner and you can’t do that if you throw away draft picks. Trevor Bauer, DJ LeMahieu and George Springer each come with draft pick compensation attached to them. It doesn’t mean the Mets can’t sign one of them but it does make it problematic to sign two or three.

Draft picks are key because they provide a low-cost source of talent. While the three players mentioned above figure to easily make eight figures each year of their deal, the 2019 Mets had eight key contributors to the team making fewer than a million dollars, including Pete Alonso in his 53-HR season. Having those types of salaries allows a team to stock the rest of their roster with big-ticket items.

But what happens when you don’t have a bunch of those pre-arb players? Sure, you can still have a bunch of relievers and bench players on that pay scale, whether they’re pre-arb or not. But you need to have those salaries also coming from productive players, like Alonso in 2019.

At this point in time, the Mets don’t figure to have any rookies debut in 2021 who will be major contributors in future years, with the possible exception of Thomas Szapucki. Last year there was Andres Gimenez and David Peterson. That’s good, except for the fact that fans want to trade Gimenez to bring in a big name shortstop and they want to sign a bunch of free agent starters and move Peterson to the minors. And all of those guys who were on cheap deals in 2019 will either start to get expensive in 2022 or will already be there.

Right now, the Mets only have four players under contract for 2022 but those four total just under $60 million, including Robinson Cano and his $20.25 million salary which is not on the books for 2021 due to his suspension. They’ll also have 15 arbitration-eligible players, including 10 that will be in their second or third arbitration season. And two of the first-time arb players will get more than token raises due to being starting position players with an All-Star appearance already on their resume. Now, not all of those arb-eligible players will be tendered a deal. Let’s take a look at the potential arbitration guys:

Edwin Diaz, Brandon Nimmo, Seth Lugo, Dominic Smith, J.D. Davis, Amed Rosario, Miguel Castro, Robert Gsellman, Guillermo Heredia, Jacob Barnes, Tomas Nido, Jeff McNeil, Drew Smith, Alonso and Luis Guillorme

Still, they’ll have somewhere around eight arbitration salaries on their roster. Here’s what they paid to arb-eligible players since 2015:

15 – 6 players, $17.92 million
16 – 5 players, $21.09
17 – 7 players, $28.74
18 – 7 players, $36.32
19 – 4 players, $18.64
20 – 9 players, $48.42 (pre-adjustment)

Let’s look at 2018, since 2020 was a weird year and they only had four ab-eligible guys in 2019. In 2018, they had an Opening Day payroll of $150.6 million. In addition to their seven arb guys, they had three salaries on the book for at least eight digits, seven salaries between $2 and $9 million and 12 guys who made $606,000 or fewer. That exceeds 25 guys but includes injured players.

So, if our 2022 roster has four guys making $60 million and eight arbitration guys making, say, $30 million – that leaves a minimum of 14 players – assuming a 26-man roster – to fill out the Opening Day payroll. But unlike in 2018, there aren’t going to be 12 players making roughly minimum wage. And we still have to add in whatever other free agents sign long-term deals this year, along with any of the four current players eligible for free agency they may re-sign. Plus, the fans no doubt will want them to be players in the free agent market that offseason, too.

Let’s make some assumptions.

Let’s say the NL has the DH going forward, the Mets make no major trades and they sign one free agent to a big multi-year deal and one to a one-year deal. Let’s say they get Springer for an AAV of $25 million and they ink a SP to close out this season’s big moves. Let’s further be optimistic and say that Gimenez establishes himself as a league-average SS and Peterson as a solid SP4. Where does that leave the roster?

For 2022, there’s $85 million in five known contracts, $30 million for eight arbitration cases and $1.5 million for pre-arb Gimenez and Peterson. That’s $116.5 million. And you need three starting pitchers, a right fielder and possibly even a third baseman, depending on how things shake out there this year and what the plan is with Cano moving forward. Let’s continue to be positive and say that Davis works out at third base and is one of our eight arb guys. How much money do you spend for an SP2, SP3, SP5 and a starting RF? Let’s ballpark that at $80 million. That puts you right up against the CBT line once you fill out your remaining slots. And that’s likely an optimistic scenario, counting on Davis, Gimenez and Peterson all being cheap starters.

Arbitration is a tricky thing so maybe that $30 million estimate is off. Under the Wilpons, the Mets bent over backwards to avoid going to arbitration with their players. It will be curious to see if the Sandy Alderson-Jared Porter front office continues that trend. Regardless, let’s take a moment and see how Mets players in the recent past who’ve been arb-eligible at least two times with the club fared as they went through the system:

Player        
Lucas Duda $4.20 $6.73 $7.25  
Matt Harvey $4.33 $5.13 $5.63  
Jeurys Familia $4.10 $7.43 $7.93  
Jacob deGrom $4.05 $7.40 $17.00  
Wilmer Flores $2.20 $3.40    
Travis d’Arnaud $1.88 $3.48 $3.52  
Zack Wheeler $0.80 $1.90 $5.98  
Noah Syndergaard $2.98 $6.00 $9.70 $9.70
Michael Conforto $4.03 $8.00 $11.75 (p)  
Steven Matz $2.63 $5.00 $5.20  
Edwin Diaz $5.10 $6.5 (p)    
Brandon Nimmo $2.18 $4.85 (p)    
Seth Lugo $2.00 $2.75 (p)    
Robert Gsellman $1.13 $1.5 (p)  

The (p) is the projected figure from Cot’s for the 2021 season.

We see that Conforto made $4 million his first year of arbitration. Let’s assume that the following players all have solid seasons in 2021. Given that, it seems possible – perhaps even likely – that Alonso and McNeil will surpass that mark. Nimmo seems likely to get in his third arbitration year what Conforto got in his second. Diaz seems likely to be near what Familia got in his third year of arbitration, perhaps slightly less. Those four alone should top $20 million and $25 wouldn’t be a shock. It seems to me that $30 million is a good ballpark guess for the eight arbitration cases and might even be on the low side, especially if Smith and/or Davis has a big 2021.

It’s hard to project the 2021 roster right now, much less the 2022 one. But that’s what the front office has to do – keep in mind the big picture and see when the right time is to incur the CBT penalty. And the big picture is where they are at both on the success cycle and where they are at with homegrown players ready to step in.

We all want to think the Mets are ready for prime time yet they played the 2020 season at a 70-win pace. Now, there are a lot of reasons to think the Mets are better than that. Still, you are what your record says you are. Is it the prudent thing to go all-in and hope the team can make a 25-game improvement in the standings?

That’s a tough sell here in early January. Now, it could be an entirely different story come the trade deadline. Maybe the pitching is doing great, most of the offense is having good years but shortstop is a black hole. Perhaps then will be the time to pay the price and exceed the CBT. Or perhaps that’s even further down the road.

You can argue that the CBT should be irrelevant with current ownership and there’s nothing wrong with that point of view. But in a way, it’s like stumping for a 4-man rotation or advocating for pitchers to throw 125 pitches without losing our mind, Those are good ideas in theory but it’s not the current MLB reality for the overwhelming number of clubs. The Dodgers, Giants and Tigers stopped paying the tax after 2017 and the Nationals followed a year later. The Red Sox and the Cubs will be under the threshold in 2021, possibly even the Yankees.

It’s why we seem like we’re heading towards a labor/management issue. Teams aren’t spending like they once did and there are incentives currently for them to act this way. We can wish this wasn’t the case. But it’s the reality of the situation and one of the reasons why the Mets are acting the way they are in the current free agent market.

10 comments on “How the Mets’ 2022 budget influences their 2021 free agent choices

  • Joe Vasile

    Honestly I hadn’t even considered so many of the Mets moves through the context of thinking about 2022 as well, but it actually makes a lot of sense. I guess that’s why I’m not running a MLB team. With Cohen and Alderson’s comments since September about focusing on building up the Mets minor league system and analytics/scouting departments, it makes sense that they’d want to stay under the CBT at least this year if not next as well. Instead of paying all that money to MLB’s coffers, keep it yourself and use it to invest back into the team. Then when the time presents itself, strike. And I’m right there with you that the CBT is the main reason we’re likely headed to a work stoppage after this season.

  • Mike W

    This is a brilliant article and is probably exactly how the Mets are thinking. That is why it is important to have talent in the minors.

    How would 2021 and 2022 look if we didn’t make the disastrous Cano trade. Kelenic would be in the wings for center field and we would be focused on adding starters. We would not have the Cano tax in 22 and we would be a step closer to being a real contender.

  • Dan Capwell

    Question: The Mets will pick 10th in the upcoming draft. I thought that any team with a pick of #15 or below had the first pick protected? Does the QO remove that protection, or would the team losing the FA to the Mets (for arguments sake lets call them the Astros) get the Mets second round pick? Or a lower pick? I guess I could look this up, but asking instead.

    If they do indeed lose the first round pick, then I am staying away from any of this year’s FAs with a QO.

    Happy New Year!

    • Brian Joura

      “Any team that signs a player who has rejected a qualifying offer is subject to the loss of one or more Draft picks. However, a team’s highest first-round pick is exempt from forfeiture, which is the most notable change that went into affect with the new system. Three tiers of Draft-pick forfeiture — which are based on the financial status of the signing team — are in place to serve as a penalty for signing a player who rejected a qualifying offer:
      • A team that exceeded the luxury tax in the preceding season will lose its second- and fifth-highest selections in the following year’s Draft, as well as $1 million from its international bonus pool for the upcoming signing period. If such a team signs multiple qualifying-offer free agents, it will forfeit its third- and sixth-highest remaining picks as well.
      Examples: A team with one pick in each round of the 2019 Draft would lose its second- and fifth-round picks. A team with two first-round picks and one pick in each subsequent round would lose its second-highest first-round pick and its fourth-round pick.
      • A team that receives revenue sharing will lose its third-highest selection in the following year’s Draft. If it signs two such players, it will also forfeit its fourth-highest remaining pick.
      Examples: A team with one pick in each round of the 2019 Draft would lose its third-round pick. A team with two first-round picks and one pick in each subsequent round would lose its second-round pick.
      • A team that neither exceeded the luxury tax in the preceding season nor receives revenue sharing will lose its second-highest selection in the following year’s Draft, as well as $500,000 from its international bonus pool for the upcoming signing period. If it signs two such players, it will also forfeit its third-highest remaining pick and an additional $500,000.”

      https://www.mlb.com/news/mlb-qualifying-offer-rules-explained-c259650658

  • TJ

    Brian,
    Wow, excellent piece as usual. You theme is very aligned with what I have referenced in several previous comments. Of course, you have supported it through research, facts, and effort, as opposed to my lazy, off-the-cuff ramblings. We all know that the teams that sustain competitiveness do it through developing their own players, which in the current system provide below cost winning contributions, which in turn allow the wealthier teams to fill holes via overpriced free agents. This is not great for baseball, but who knows how and if it will be improved upon in the current deal. Alderson realizes that the gap in upper level prospects carries a future cost, as you pointed out in great detail above. That can only be partly fixed with money, as it almost certainly needs time and some current prospect luck to fix. It’s great to have Uncle Stevie and his bucks, but it can’t fix all the holes without creating future prospect risk. I do think they will win Springer, hopefully at close the the $25 million AAV. That will be ok, maybe even better than ok, although they can live without it. Signing Springer could really cost them Conforto. That’s a tough call. If they love Conforto, they could be better served with a modest rotation signing, loading the pen with two more quality additions, and adding CF/3B bench defense. That would preserve the picks, while allowing them to be competitive in 2021 and well poised to add/retain players beyond. Of course, the fanbase will be bummed given the great expectations that Uncle Stevie has brought, but it may be more diligent in the long run.

  • Chris F

    Great job Brian; it’s like you are inhabiting my brain! Every move has compounding effects that the white board in the FO suite has populated for years. It’s clearly what makes the long term contracts so debilitating to a team.

    In general, I think Mets fans live in this world of perpetually believing it is a playoff contender no matter what reality says. As a result, there is always the belief structure that the team is a only closer and right-handed power bat away from October and so is in “win now” mode; this tragic mistake has led to terrible decisions – like the Cano trade – which almost never pay off. The exception being 2015 when the Mets peaked as the Nats floundered under the effects of a rotten clubhouse.

    “Win now” spends all the money without thought for the future and trades young talent for aging superstars on the steep decline. Cohen is too smart to allow that, and so is Alderson.

  • Brian Joura

    Thanks to Joe, Mike, TJ and Chris for the kind words!

  • Seattle Steve

    Very insightful….Springer is #3 ..,in centerfielders …behind Trout and Acuna and is worthy of a very big contract…Conforto at best is the #3 right fielder behind Betts and Harper with the Cano contract you can see these 3 players plus Jake will total over 100 mill.
    On this team Bauer cannot be offered more $$$$than Jakeso forget about him….I do not care how much $$$$ Cohen may have … he will be prudent in his free agent spending and wisely so.

  • Remember1969

    Nice work, Brian! Digesting this and playing with different scenarios will give me something to do for a while 🙂

    I had done up one plan earlier with the 2022 outlook as part of it, but not sure how realistic that was – some assumptions made may not be particularly valid.

    I suspect even if there is not a CBT tax threshold, Cohen might have a similar number in mind for his annual spend. I cannot imagine he would be willing to go to $300M just because he can.

  • Bob P

    It’s interesting to re-read this article now that the Lindor trade has been made. With Carrasco the Mets now have 5 players under contract for about $75M. If Lindor is signed to a long term deal I have to think it will be at least $30M. If you use the same $30M estimate for 8 arb eligibles, you are now at $135M for 14 players. If Springer is signed at $25M, now we are at $160M and still need at least 2 more starters and a RF.

    Conforto, Syndergaard and Stroman will be FA, so who do you sign and for how much? If Noah comes back close to his pre 2019 form he will get $20M+, as will Conforto.

    The front office needs to take all of this into account, as Brian has said. The numbers start to get astronomical. For those who still want Springer, Odorizzi and Hand/Hendricks, I don’t think that’s realistic. It points out the importance of getting value out of pre-arb players in the current system. The system may change with the next bargaining sessions, but those contracts won’t change.

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