MLB NEWS/RUMORS Thread

agree on stanton
but i disagree on morrow if the price is right
next to kenley he was our most reliable reliever

 

what i've been saying all along...


Luxury Tax threshold could impact Dodgers’ activity in Free Agency
by Jeff Spiegel | Dodger Blue — 22 minutes ago

For as long as the new ownership took over, the Los Angeles Dodgers’ strategy has (seemingly) been simple: spend, spend, and spend some more.

Last winter, the Dodgers topped the league in free agency spending — shelling out nearly $200 million on six players. The offseason prior? Much of the same — $193 million on the likes of Scott Kazmir, Kenta Maeda, Howie Kendrick and others.

So what’s on tap for this offseason? Something most fans probably won’t want to hear coming off a Game 7 loss in the World Series loss: likely not much in terms of free agency. And the reason stems from the luxury tax threshold that was imposed in the new Collective Bargaining Agreement.

The way the luxury tax works is that your tax rate increases for every year your total salaries exceed the threshold. But if a team can get below the threshold for just one year, everything resets.

For some context, the Dodgers have paid over $100 million in luxury taxes in the last three years alone. That’s despite trimming their overall salary this past season. It sat at $227.8 million heading into 2017.

The good news for the Dodgers is that plenty of dead money paid to players not on the roster is coming off the books. Specifically, Carl Crawford, who was released in 2016; and Andre Ethier, who had his $17.5 million club option for next season declined.

Heading into the offseason began, the Dodgers’ projected payroll for 2018 was at $177.7 million in guaranteed contracts. Keep in mind the luxury tax threshold is set at $197 million.

So the team, in theory, had $20 million to spend while simultaneously being able to reset themselves. Sounds easy, right? Not quite…

Logan Forsythe’s $9 million option for next season was picked up. Moreover, the Dodgers still have several players eligible for salary arbitration.

The group consists of Luis Avilan, Pedro Baez, Tony Cingrani, Josh Fields, Yimi Garcia, Yasmani Grandal, Kiké Hernandez, Joc Pederson and Alex Wood.

Like Forsythe, these players all no-brainers simply because of relative low-dollar amount that likely will be needed to avoid arbitration. Nonetheless, the grand total could run upwards of $30 million. That would send the Dodgers over the luxury tax threshold.

Now, some might be wondering why the team wouldn’t just take one more year of luxury taxes and get under in 2019. That’s when Adrian Gonzalez, Scott Kazmir Brandon McCarthy, Yasiel Puig and Hyun-Jin Ryu are all off the books.

The answer is simple: the 2019 free agent class is going to be arguably the most tantalizing in MLB history.

Bryce Harper, Manny Machado, Matt Harvey, Craig Kimbrel, Zach Britton, A.J. Pollock, Josh Donaldson, Andrew McCutchen, Adam Jones and Andrew Miller headline the group — which could also include Clayton Kershaw and David Price if they are to opt out of their contracts.

What can the Dodgers reasonably do this winter to remain among the best teams in baseball and get under the salary cap? The answer would have to come in the form of trades.

Can the Dodgers unload some of Gonzalez’s salary ($22.4 million) to a team interested in a veteran presence? Could they look to move Grandal thanks to the emergence of Austin Barnes?

What about eating some of Kazmir’s remaining salary ($17.7 million) in order to dump him? Could the same be done for McCarthy ($11.5 million)? Or, is this winter finally when the Dodgers part with Yasiel Puig ($9.2 million)?

It certainly would not be a popular move, but it would mean parting with a sizable salary and perhaps add future assets to the organization.

While all of this might sound bleak, keep in mind that even without any offseason additions, the Dodgers are in fantastic shape roster-wise.

Even without signing anyone from outside the organization, the Dodgers’ Opening Day roster would be some combination of:

Catchers: Austin Barnes, Kyle Farmer, Yasmani Grandal

Infield: Cody Bellinger, Charlie Culberson, Logan Forsythe, Adrian Gonzalez, Corey Seager, Justin Turner

Outfield: Kiké Hernandez, Joc Pederson, Yasiel Puig, Chris Taylor, Trayce Thompson, Andrew Toles, Alex Verdugo

Starting pitchers: Rich Hill, Scott Kazmir, Clayton Kershaw, Kenta Maeda, Brandon McCarthy, Hyun-Jin Ryu, Brock Stewart, Ross Stripling, Alex Wood

Relief pitchers: Luis Avilan, Pedro Baez, Tony Cingrani, Josh Fields, Yimi Garcia, Kenley Jansen, Adam Liberatore

The only pieces really missing from the World Series run would be Brandon Morrow (who might be re-signed), Yu Darvish and Watson.

The truth is, this is all a lot to take in and the possibilities here are truly endless — not to mention often unpredictable.

Dodgers president of baseball operations Andrew Friedman and general manager Farhan Zaidi have done a tremendous job to this point in rebuilding the organization from the bottom-up without sacrificing a single year of competitiveness.

And 2018 shouldn’t break from that. This winter it might just look a bit different…

 

...

Where the Dodgers stand with the competitive balance tax in 2018
by Eric Stephen | True Blue LA — 90 minutes ago



The general managers meetings begin on Monday in Orlando, and while not as exciting as the winter meetings, the annual event allows a chance to lay some groundwork for the offseason.

For the most part, the Dodgers in 2018 will likely look very similar to the 2017 team that won 104 games and got to the seventh game of the World Series, though there are some trade and free agent opportunities.

“We’re fortunate to be in a position where a lot of the team is going to be coming back,” general manager Farhan Zaidi said last week. “Every offseason, you take a look at your roster and find potential target areas. As we look at our roster, we don’t feel like we have any glaring needs. We’re going to continue to be opportunistic like we always are for ways to improve the roster.”

Something to watch on just how the Dodgers improve the roster will be the competitive balance tax. The club has been over the tax threshold for five straight seasons, paying a total of $113.5 million in tax from 2013-16, and will have a bill of at least in $25 million more for 2017 per the Associated Press, and probably a little more since that estimate was based on opening day payrolls.

The luxury tax threshold will be $197 million in 2018, $206 million in 2019. The Dodgers are currently paying at a 50% rate for any payroll over the threshold as a repeat offender. At some point the club would likely prefer to get under the threshold to avoid the tax, since that would reset the penalties going forward, starting at 20% for the first year over, 30% the second year, then 50%.

“What’s the luxury tax?” president of baseball operations Andrew Friedman joked last week. “We don’t have really have a great feel for exactly how things will play out. The one thing we are confident about is that we’ll get to CBR in February with a team that is positioned to compete for a championship.”

The Dodgers have some room to maneuver under the tax threshold — a little bit this winter, and more flexibility next offseason. But just how much?

For competitive balance tax purposes, the average annual value of the contract is used instead of the actual money paid out during each season. For instance, Justin Turner will make $11 million in 2018, but with his contract guaranteeing him $64 million over four years, his tax number for 2018 is $16 million.

Similarly, half of Scott Kazmir’s $16 million salary is deferred until 2021. But instead of an $8 million figure for competitive balance tax purposes, his 2018 number is just short of $15 million — the average of his salaries over the life of his three-year, $48 million contract, discounted to account for the deferrals.

Here is a quick and dirty look at where the Dodgers stand for 2018 in regards to the luxury tax, including salary arbitration estimates from MLB Trade Rumors:

The total payroll includes an amount for benefits that is the same for all team. It was $12.9 million in 2016 and estimated to be just shy of $14 million in 2017. We estimated here that next year those benefit costs will be $15 million.

The Dodgers’ payroll includes some dead money, including the released Dian Toscano (he was in the Bud Norris trade from Atlanta in 2016, and had a four-year, $6 million contract through 2018) and the club’s payment to San Diego from the Matt Kemp trade. I still haven’t gotten an answer one way or another whether Kemp’s number is the $3.5 million the Dodgers are paying in 2018 or an average of what they will have paid from 2015-2019 ($6.4 million). For now, we’ll keep it at $3.5 million.

The Dodgers are already at $177 million for 20 players on the 40-man roster, but that also includes Kazmir, who last pitched in the majors in 2016. Filling six more active roster spots at salaries somewhere near the minimum salary of $545,000 would add another $3.5 million roughly to the total, putting the Dodgers at approximately $180.5 million.

That’s still shy of the luxury tax threshold of $197 million, but it’s also before any other moves are made.

Escalating costs

With the new collective bargaining agreement, there are now extra tiers of penalties for exceeding the luxury tax, more punitive as the payroll increases.

• For teams $20 million over the threshold, there is an extra 12% surcharge
• For teams $40 million over the threshold, there is an extra 45% surcharge (42.5% for first-time offenders)​

That means that for the Dodgers in 2018, any payroll above $237 million will be taxed at a 95% rate, so each marginal dollar added is nearly doubled.

As an example, if the Dodgers have a $250 million payroll next year, they would pay...

• 50% on the amount from $197 million to $217 million: $10 million
• 62% on the amount from $217 million to $237 million: $12.4 million
• 95% on the amount above $237 million: $12.35 million
• Total tax: $34.75 million​

There is also one more punitive cost to exceeding that highest threshold, beginning in 2018. Teams that are in that highest tier will see their first draft pick moved back 10 places.

Each of these penalties have some monetary value, to be factored in as a cost before considering each potential deal. It doesn’t necessarily mean the Dodgers will avoid such deals, just that the current collective bargaining agreement makes things a little more costly for doing so.

 

That article was lame.

If we trade for Stanton sure there is a tax hit this year, but we enter the big FA derby from a position of strength.
All our other bad contracts will be gone by then and even with Stanton on the roster the tax situation will be manable.
We most likely will not have any weaknesses at that point. So we can let other teams fight for all those top FA.
Then pick up some very good players on budget contracts like what happens whenever there is a big FA derby.
There are winners and then there are guys who normally would be getting good deals but end up having to settle.
Lots of real nice players at the middle of that FA list.
Would be easy to fill any potential hole.

 

This is a better article.
So the team is at 177M and the threshold is 197M so that gives them 20M to play with.
The next threshold is is 217M which is the first level of tax. That may be seen as acceptable.
We would be at that first level of tax for about 10M worth of the first year of Stantons deal.
Then we would drop below the tax threshold even with Stanton on the team.
Of course not if we also sign Otani or somebody else this offseason.
And we may be able to offload some of our expiring bad deals to teams who dont plan to be in the FA hunt next year and may want the assets that accompany that big contract.

Point being that you should not get bedazzled by the articles full of stats and facts. They are not necessarily saying anything that is true.

 

actually, the point being you sometimes need to read everything completely before commenting
like that $177MM you spoke of...

• Heading into the offseason began, the Dodgers’ projected payroll for 2018 was at $177.7 million in guaranteed contracts. Keep in mind the luxury tax threshold is set at $197 million. So the team, in theory, had $20 million to spend while simultaneously being able to reset themselves. Sounds easy, right? Not quite… Logan Forsythe’s $9 million option for next season was picked up. Moreover, the Dodgers still have several players eligible for salary arbitration. The group consists of Luis Avilan, Pedro Baez, Tony Cingrani, Josh Fields, Yimi Garcia, Yasmani Grandal, Kiké Hernandez, Joc Pederson and Alex Wood. Like Forsythe, these players all no-brainers simply because of relative low-dollar amount that likely will be needed to avoid arbitration. Nonetheless, the grand total could run upwards of $30 million. That would send the Dodgers over the luxury tax threshold.

 

Thats fine though. Its still keeps us around the threshold. They will be at the threshold by February... after that they will sign guys and go over. The idea is to get down by not signing these guys for a while so the threshold defcon level can reset back down.
After that they can pass the threshold again and the will just incur the standard penalty which I think they are ok with having to pay a little bit if it means adding an important player.

 

Can I have Cozart at least then.
I wont ask for Villar again.

 

yeah heard that too
a good guy if he liked you and not very liked by the others
may very well be a reason he was passed over in favor of roberts
hadn't heard he was not open to other opinions but it doesn't surprise me
might be a good short-term fit in philly to get on the players
and a pretty good scapegoat if he can't turn them around
good riddance