Smallest clubs thrive on largest Draft bonuses
Pirates among clubs aware of looming hard-slotting threat
Pirates team president Frank Coonelly certainly caught the irony of it all.
There he was, talking in a PNC Park office last Tuesday, one day after the Pirates had exceeded more than one-third of their Major League payroll by dishing out a Major League-record $17 million in Draft bonuses. Just the sort of spending that Coonelly had once dedicated himself to trying to prevent.
But unless you desire a soapbox speech, don't dare tread near the word hypocritical. It's a label Coonelly takes great exception to, and he recently made that explicitly clear to one New York writer who described him as such.
"I had a job to do at the Commissioner's Office, and I have a much different job to do here," Coonelly said. "It would be negligent and not doing my job if I came here to Pittsburgh and didn't encourage [above-slot spending] because of my allegiances to my old job. If I did that, well, then I should be fired."
This current recommended slotting system for baseball's First-Year Player Draft was once Coonelly's brainchild, before he came to Pittsburgh in 2007. As senior vice president and general counsel of labor to the Commissioner, Coonelly instituted a Draft support program last decade that, through one component, gave teams recommendations on how much players picked at certain spots of the Draft should earn as a signing bonus.
The program was intended to educate and utilized data to show clubs the real risk and uncertainty in the Draft. That data then gave way to recommended slot figures based on historical precedent for what players selected in certain rounds had done.
The catch was that the recommendations were simply that. As long as a team could handle a slap-on-the-wrist call from Coonelly or someone else in the Commissioner's Office, it was free to play by whatever rules it desired.
And that's mostly what's happened.
But with a new Collective Bargaining Agreement looming, this method of signing amateur players could be entirely uprooted before the 2012 Draft class gets its chance to exploit the system. And in another twist of irony, that might not necessarily be all that great a development for the Pirates or other mid-market clubs that have thrived by pouring their financial resources into the Draft.
"We have certainly been able to capitalize on the system that is in place," general manager Neal Huntington said, one day after giving second-round pick Josh Bell a record $5 million to lure him away from a college commitment.
"A true slotting system levels the playing field, which we've actually enjoyed being unlevel at this time. We'll certainly follow whatever Major League Baseball feels is the best for the industry, but whatever system it is, we'll certainly look to maximize our returns from it."
In almost any other case, talk about capping spending would be met with cheers from clubs that can't compete with the game's biggest market. Not so much when it concerns the Draft.
A total of seven teams spent at least $11 million in Draft bonuses this year. The Pirates led that group and were followed by the Nationals, Royals, Cubs, D-backs, Rays and Padres. Included in that bunch are the four clubs -- Kansas City, Tampa Bay, Pittsburgh and San Diego -- who opened the season with the four lowest Major League payrolls.
In fact, of the seven, only the Cubs had an Opening Day payroll that was better than 22nd in baseball.
So why would teams allocate such substantial resources to the Draft as opposed to their Major League product? Well, for clubs that don't have unlimited resources, it's simply the most logical route toward ensuring a competitive big league product.
"Knowing how the economics of this game work, we would rather do that than overspend for middle-of-the-road Major League free agents," said Royals GM Dayton Moore, whose team spent approximately $14 million on a 2011 Draft class headlined by first-rounder Bubba Starling. Starling took $7.5 million of that to forgo a scholarship to the University of Nebraska.
"We would rather take our chances with players that our scouts feel can potentially become stars and help us win championships and build a system that has a depth of talent in which we can maneuver and operate from, either via trades or certainly transitioning these players to the Major Leagues, versus bidding on Major League talent where we have very little chance of winning the negotiations. That's why we do it and why we've been very aggressive."
Neither Moore nor Huntington would go so far as to agree that the implementation of a hard-slotting system would hurt both organizations' attempts to even the playing field. But there is no question that both teams -- and others who fall in the mid-market tier -- could lose one of the few advantages they have.
Predetermined signing bonuses would significantly reduce the power of player representatives. There could be no posturing without negotiations, and a lack of negotiations eliminates the tactic of overpaying to keep kids from going to school (see: Starling, Bubba; Bell, Josh).
Sure, there undoubtedly would be benefits with a hard-slotting system. Controlled bonuses would limit spending, meaning, in theory, that more money could go to players who have already established themselves in the Majors.
Gone would be the long and often unproductive two-month negotiation period that stalls the starts of so many professional careers. A slotting system would also ensure that the Draft serves its intended purpose -- teams with worse records the year before get the best players. No strings attached.
"It would keep us from acquiring, in our view, multiple top-round players throughout the Draft," Coonelly said. "But I think for the industry as a whole and ultimately, for the Pittsburgh Pirates, by taking away the potential for gamesmanship, you get players into the professional game shortly after the Draft and you allow all clubs to draft based on the basis of talent and not the basis of signability.
"I think all of those benefits outweigh what may have been our advantage, given our strategy early on."
Maybe. Or maybe the Pirates, the Nationals, the Royals and others would be better served if things stayed just as they are. It's an advantage that -- even if they don't come out and say so -- they very much need.
Jenifer Langosch is a reporter for MLB.com. Read her blog, By Gosh, It's Langosch, and follow her on Twitter @LangoschMLB. This story was not subject to the approval of Major League Baseball or its clubs.