Yesterday, the Orioles signed Yovanni Gallardo to a 3-year contract worth a guaranteed $35M. This off-season, the Orioles have spent roughly $260M on contracts and word is they are going to get Dexter Fowler done, likely for a deal in the 2 year, $24M range. Unless they decide to still sign Tim Lincecum, that should be bring an end to their off-season spending and it will push them to about $285M. That’s a number no one saw coming. Whether you agree with how it was spent or not, Dan Duquette set out to make these moves, stated publicly what he wanted to do and got the job done. For years, Orioles fans have been saying that they don’t spend enough and that we need to see the payroll rise. Well, since 2013, the payroll has gone up and if you look at this recent run of success, starting with 2012 and you see the expected 2016 payroll to be around $160M, the team has doubled its payroll and it has gone up every year since. They deserve kudos for that, even if the allocation itself can be questioned.

(You can discuss this article on the BSL Board here.)

Going forward, the issue is how does this off-season effect the future of the payroll and, perhaps more importantly, how does it impact signing Manny Machado (more on that later)?

In 2017, they currently have roughly $80M on the books. Cots shows $87.1M but that includes the deferred money for Davis, Ubaldo and O’Day which isn’t being paid until after their contracts are completed. The players under contract are Davis, Jones, Hardy, Jimenez, Gallardo, O’Day and Kim. Also, we will see how the Fowler contract is structured but that number should be closer to 95 million after he is signed.  The Orioles will also have a lot of expensive arbitration eligible players. Between Machado, Britton, Tillman, Gonzalez, Worley, Flaherty and Brach, that should be another $46M dollars. Of course, all of those guys may not be tendered a contract and that will be a big key to the off-season of 2016-2017, in terms of how much do you have to spend in a down free agent class and because the class is down, the Orioles may decide to go with a similar team in 2017 as in 2016, especially if they see success. So, the O’s are going to enter 2017 with a payroll of about $140M dollars (including Fowler), if all those players are kept. Then, you add in first year arbitration eligible guys in Schoop, Gausman and Joseph and that should be another $8-12M. That is 17 players. Add in guys, if they are still here, like Givens, Wright and Bundy and the team for 2017 is largely in place. Even if some of these guys are kept, you still probably have at least 12-15 guys already set for 2017. We will see what Minor Leaguers like Mancini, Walker, Scott, Lee, Stewart and Sisco accomplish this season and see if any of them can enter into the picture. I would think Lee has the best chance out of that group and he could make an impact this season. All in all, if you like the team in 2016, you are going to like the team in 2017. There will be the need to replace a few guys here and there (like Trumbo and Wieters) but unless we see some bad injuries or we see the team struggle and make some trades, this is your team now and in the future.

2018 is a different story. After the 2017 season, the Orioles will say goodbye (at least in terms of players who are scheduled to be free agents at this time) to Jimenez, Tillman, Hardy, Gonzalez and Flaherty. The existing payroll drops to $58.4M with Britton, Machado, Schoop, Gausman, Brach, Worley and Joseph all set to make good money in big arbitration years. They will still have Davis, Jones, Gallardo and O’Day under contract but obviously, the team will need more help and players from the outside in 2018 vs. 2017.

Once the 2018 season is over with, you have Davis and O’Day on the payroll and that’s it. This off-season has seen the team spend a lot of money but most of is still off the books by the end of 2018, at least in terms of the players themselves. So, back to how this impacts Machado.

This has to be the single biggest question facing this organization going forward. I felt that signing Machado should have been priority #1 this off-season and I stand by that. By spending the money they did this off-season, the Orioles have shown Machado that they will spend and that they are committed to trying to win. In the past, Machado has stated his desire to sign a long-term contract with the team. We haven’t heard anything since he said that and we don’t know if his mind has changed. We do know that he considers Davis and Schoop two of his closest friends and with them both here for a long time, that can’t hurt the team’s chances. Also, with so little money on the books past 2018, it would seem to me that they are set up to give Manny what it will take to sign him. So, what is the hold up? Is Manny now not interested? Are the Orioles still concerned about the knees? Do they need to see more from him? Are they now going to concentrate on it since the other things for 2016 are now done?

We know Machado will make $25ish million in 2017 and 2018 combined. We also know that the superstar elite guys are getting $30+ million in their free agency years, not the 20+ it used to be. So, how long does Manny want to sign for? He doesn’t turn 24 until July 6th. If he signs a 6 year deal, starting in 2017, he will be a free agent for the 2022-2023 off-season and he will be 30 years old. If the first two years of that deal is $25M and he averages somewhere in the $27-32M range for the other 4 free agency years that gives him a total deal of 6 years at $130-155M. It’s possible some kind of 8-10 year deal could be done but it would need to contain an opt out and I am not sure Duquette, will even be for that even though he isn’t likely to be the GM beyond 2018 (although there is a lot that can happen between now and then).

There used to a be a time where committing 27-32 million on one player wasn’t feasible for this organization and the team’s payroll.  That doesn’t appear to be the case anymore.  The game is flush with money and if the team continues to win, the ticket sales (with increased prices coming, which is a good thing IMO) should continue to be strong, so the payroll should be able to sustain at this level and perhaps go much higher.

Does Machado, a player who has had two major knee surgeries, say no to that guaranteed extra $110-130 million dollars (beyond the arb years) and put off his free agency or does he just want to be a free agent after 2018, join the monster class, and see if he can get $300+ million? I could see him choosing either path, but if I am the Orioles, I am doing everything I can to keep him and that should be a priority now.

The Orioles have clearly chosen the path of going for it right now. The minor league system has taken a hit now they are losing the Top 2 picks of their draft. To compensate for that, they are spending on the major league team and who knows, maybe they will continue to surprise us and maybe they will spend internationally this year to make up for some of what they lost in the draft. That being said, you have a majority of your roster, your manager and your GM all off the books after the 2018 season. Who knows, your owner may be gone too. So, this is your window to win. It will be interesting to see what they do with the future of the payroll, the team and, most importantly, Manny Machado, as time moves on.

We also need to see how the MASN situation plays out and how that effects things but, for right now at least, the Orioles are not letting that get in the way of spending.

Rob Shields
Rob Shields

Rob has interviewed guests from outlets such as ESPN, Sports Illustrated, NBC Sports, CBS Sports, FOX Sports, Baseball Prospectus, Athlon, Sporting News, MLB Network, Brooks Baseball, Baseball Info Solutions, The Boston Globe, The Washington Post, Sports on Earth, Grantland, NFL Network, FanGraphs, Football Outsiders, ProFootballFocus, etc. etc. The Baltimore native lives in Perry Hall with his Wife Lindsay, and two young sons. He has appeared as a guest on 105.7 The Fan, Q1370, and WNST 1570. Co-Host of The Warehouse: https://anchor.fm/the-warehouse Co-Host of Sports Tonight: https://anchor.fm/sports-tonight

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