Guarded optimism within MLB free agent market after two slow years

Prominent baseball player Scott Boras represents several key free agents this offseason, including Gerrit Cole, Stephen Strasburg, and Anthony Rendon, and will have a major voice in whether baseball's offseason features more active player movement than the last two years.

Major League Baseball’s 2019-20 off-season began with much of the same tension within the sport that marked each of the prior two years. 

Baseball’s annual General Managers’ Meetings, held this year in Scottsdale, Arizona, began with an angry MLB Players Association looking to investigate possible collusion by ownership following comments about the free agent market by Atlanta Braves GM Alex Anthopolous and information he was gathering about other clubs. 

The session then continued with press reports of the Houston Astros electronically stealing signs, a violation of league rules, during the march to the 2017 World Series title, sparking a wide range of reactions across the industry.

But as those GM Meetings concluded, owners gathered this week in Texas for their fall business meeting, and baseball now approaches what has traditionally been the heart of its Hot Stove season, there is still a very different mood emerging within the sport.

After two historically dormant off-seasons with relatively little signing activity, player contracts that did get done often below expected levels, and even top stars remaining without new deals until after the start of Spring Training, this late autumn and winter could be very different. 

Already, top free agent pitchers Gerrit Cole and Stephen Strasburg are attracting widespread interest among clubs. And if one listened recently to the GMs for the New York Yankees and Mets, Los Angeles Dodgers and Angels, Chicago White Sox, San Diego Padres, and Washington Nationals, they’re all on board to spend big money. 

The White Sox indeed have already struck early, signing catcher Yasmani Grandal this week to a four-year, $73m contract that represents the largest free agent contract in franchise history.

And on the player side, Strasburg is optimistic enough about the relatively improved state of the current free-agent market that he opted out of the last four years and $100m of his prior deal with the Nationals.

“All I can say is that the competition for all of the pitchers is very aggressive,” says prominent baseball agent Scott Boras, who represents both Cole and Strasburg, as well as a range of hurlers a rung or two below – such as Dallas Keuchel, as well as Anthony Rendon, perhaps the top position player available. “It’s probably the most aggressive I’ve seen because we have a lot of very quality pitchers on the market.”

Boras’ remarks were all the more notable given how vocally strident he had been the prior two years, along with the MLBPA, about the lack of interest then from teams in free agent players, repeatedly blasting what he called non-competitive behavior by clubs. The comments served as flashpoints in rising tensions over the last two years between the league and MLBPA.

But Boras then dropped an additional tidbit about a recent lunch he had with Angels owner Arte Moreno, who is particularly eager to revive a franchise that has seen four straight non-playoff seasons and recently hired Joe Maddon, best known for winning the 2016 World Series leading the Chicago Cubs as manager, as well as bringing on Hall of Famer Tony LaRussa as a team consultant in the hopes of the reviving their on-field fortunes.

“It was good,” Boras says of the session with Moreno. “He’s a guy we talk baseball with all the time. He’s very, very into the game. He’s really wanting to advance the interests of his franchise.”

Boras went on to describe a “new theater” helping govern club thinking around the free-agent market.

“There are attendance demands, [and] there are talents in this marketplace in which clubs are considering, ‘if I don’t have this kind of pitching or elite middle-of-the-order bats I’m not going to have a chance to be competitive’. And they are also those five or six organizations that are coming out of hibernation to jump back into that competitive window,” he says.

Yankees General Manager Brian Cashman, who says the MLB club is no longer operating under an ownership mandate to stay below the league’s luxury tax threshold.

Yankees and Dodgers going for the win

There is also the fact the New York Yankees and Los Angeles Dodgers, traditionally two of the sport’s larger spenders on player payroll, both say they are entering the 2020 season with no constraints from ownership, particularly with regard to staying under a luxury tax threshold set at $208m for next year.

Both teams had previously exceeded the threshold for many years, and as a result were annually subjected to a 50-per-cent tax for expenditures above the threshold as repeat luxury tax violators, and were also subject to possible reductions in draft pick position. After both teams got below the threshold to reset their repeat violator status and make them now liable only to much lower tax rates, they are now in a position to spend more freely on free agents.

“I have no directive [to get under the tax threshold] like I had prior,” says Yankees GM Brian Cashman. The Yankees fell below the tax threshold in 2018 and as a result were able to reset their tax rates from that 50 per cent to 20 per cent on the $28m they went over by in 2019, and will pay 30 per cent on any 2020 overages. 

“Obviously, we’re paying a tax this year, and I have no mandate moving forward,” Cashman says.

The Dodgers have conveyed a similar stance, and are wanting to break a championship drought that still dates to 1988 despite winning the last seven National League West titles and reaching the World Series in both 2017 and 2018.

“We’re just trying to put together the best team we can,” says Andrew Friedman, Dodgers president of baseball operations. “We just want to win the championship. That’s all. Simple goals.”

The position of the Dodgers and Yankees contrasts notably from the public position of the Boston Red Sox, who had MLB’s highest payroll in 2019 at $242m. After a frustrating, non-playoff season that also has the club paying at 30-per-cent rate on its luxury tax overage, Red Sox chairman Tom Werner said recently the club has a “strong preference” to shed payroll and get below the threshold in 2020. 

This stance, itself walking back prior comments from principal owner John Henry that the club has known for a year it needs to get below the tax threshold, has been particularly unpopular with Red Sox fans. But Boras disputes whether the outward stance of the club will be its operating reality.

“I don’t know if that’s true, by the way, because I haven’t heard that from ownership,” Boras says of the Red Sox cutting payroll. “Until [Henry] or [Werner] tell me that’s their objective, I will not think they’re anything but winning owners, trying to win again, again, and again.”

Gerrit Cole, playing previously for the Houston Astros, is widely seen as the top MLB free agent pitcher currently available.

Back to the union

When Anthopolous said prior to the GM meetings that he had spoken to 27 other MLB clubs to get a sense what they “are going to do in free agency, who might be available in trades”, the MLBPA immediately cried collusion. 

The term is easily the worst word in baseball labor history, and something team owners paid $280m in damages to players for following collusive behavior to depress the free agency markets of numerous stars in the 1980s. And because of that ugly history, the union remains on guard against any potential repeat episodes.

“The clear description of club coordination is egregious, and we have launched an immediate investigation into the matter,” says union executive director Tony Clark. 

Anthopolous for his part has sought to walk back his original comment, following that up with a subsequent statement saying, “At no time during any of these calls was there discussions of individual free agents or the Braves’ intentions with respect to the free agent market…I misspoke and apologize for any confusion.”

The Braves, perhaps coincidentally, then made the first sizable player move of the offseason, signing relief pitcher Will Smith to a three-year, $39m contract with a club option for a fourth $13m season, a move stopping Smith from accepting a one-year, $17.8m qualifying offer from his prior team, the San Francisco Giants.

In the meantime, player concerns about the ongoing state of free agency has helped prompt the union and the league to open an unprecedented round of mid-agreement bargaining. 

The current, five-year collective bargaining agreement between the pair doesn’t expire for two more seasons. But Clark earlier this year said the players were “interested in re-establishing a competitive environment”.

Those labor discussions remaining ongoing, and nothing concrete has emerged yet from those talks, with tensions rising in both camps. And MLB Commissioner Rob Manfred said this week at league business meetings in Texas there is still much work to do on this front, and suggested the union is seeking to roll back what owners sees as decades of progress.

“I said to [the union] labor peace is a mutual benefit,” Manfred said. “It’s not something they can trade economics against. It is a mutual benefit. It keeps the players working and it keeps our business going forward.”

Perhaps also slowing the pace of progress on that labor front is the league’s active investigation into the culture of the Houston Astros, who seem to be involved in nearly every recent baseball controversy, including a taunting incident involving now-fired assistant GM Brandon Taubman, and the newer allegations of electronic sign stealing.

There are other ongoing troubling issues surrounding the game, too, including a domestic violence investigation for Yankees pitcher Domingo German, a federal law enforcement investigation of the Angels following last summer’s opioid-related death of pitcher Tyler Skaggs, and another federal probe by the US Justice Department of MLB scouting practices in Latin America. 

In that latter case, the government has issued subpoenas against the Dodgers, Braves, and San Diego Padres seeking paperwork involving the signing and scouting of amateur players in that part of the world. The World Series-champion Nationals have already reportedly cooperated in the investigation.

So the last thing the sport needs is a third consecutive off-season filled with bad-news stories about the lack of player signing activity. To that end, agents from across the sport swamped the GM Meetings, actively pitching their clients to the assembled team-level baseball operations executives, and are continuing to press hard for robust deals.

San Diego-based player agent John Boggs said he had 14 meetings with clubs in two days earlier this month discussing various players he represents, notably veteran pitcher Cole Hamels.

“They were all about 10 minutes in duration,” says Boggs, also shopping fellow pitchers Trevor Cahill and Yoshihisa Hirano. “There will probably be interest from two of them.”

But within that hope and activity there is still a guardedness, too. Asked if he enjoys this time of year, Boggs was particularly blunt.

“No,” he says.

To each his own.

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