Contracts Primer and FAQ

Mike Jackson

Guys,

We are only a few weeks away from the finalization of our player pool for the 2015 season, which means that teams will need to start thinking about roster moves. I usually start getting quite a few questions around this time of year, so I thought it would be useful to create a blog post for easy reference that will hopefully answer most of the questions you may have. If it doesn’t, still feel free to ask away!

Contracts Primer

The standard BLB contract is 3 years at whatever salary is paid in the auction. Prospects (which are denoted with a “P-OPT” on the team pages) can be signed to a standard length contract for $10 (1/3), meaning that after year 3 they can be renewed just like any player selected normally in the auction. After our auction, each team will select 8 players to sign to minor league deals in the snake format minor league draft. These players cost $0 in the year they are drafted, and owners have an option to sign them for the following season for $10 to a 1 year deal ($10, 1/1). These aren’t denoted specially on the team pages, but you can tell which guys were minors guys since their status currently shows “$0, OPT”.

Players not on an MLB 40 man roster on Feb 1st are not eligible for the BLB player pool. If these players are on a BLB roster, they are removed from the roster at no cost to the owner. Most of the time this is a good thing (ie a guy is so crappy he isn’t signed), but sometimes it can be a bad thing (ie, for Titletown who has Max Scherzer, if he doesn’t sign AND OFFICIALLY GET ADDED to an MLB roster by Feb 1, he’s gone and Craig gets shafted out of an ace).

After the Feb 1st deadline to set the player pool, each team will have until Feb 10, 2015 to be cap compliant (more on that below) and submit the following:
Decisions on option players:
Minors/Prospect guys are described above. Other players in their option year can be extended by one year (at the same salary, ie $5, 4/4 for example), or by “x” number of years at a salary of Y + X*5 (Y = current salary). For example, if you had a player who’s signed for $5, he could be extended by 2 years at $15 per year ($15, 4/5), or by 3 years at 20 bucks ($20, 4/6), etc etc.  Of note is that you can only extend/renew a player ONCE. For example, if I extend a guy for $20, 4/6, after year 6 there is NO option to extend again.
If you don’t want to sign an option guy at all, he is a “free” drop, in that you don’t have to pay anything to let him go back into the draft.
Buyouts
Buyouts of players not in their option year can be done by taking the TOTAL value left on the deal and dividing by 2 (round up) and take it as a one time penalty on the upcoming auction year.
 For example, if you have a player signed to a $33, 2/3 contract, there is $66 left on his deal, so the buyout costs you $33 (basically you pay full salary to gain the roster spot and shed the commitment for the following season). If he’s signed to a 3/3 deal, the buyout is 33/2 = $17 (so you save half the contract value).
Cap compliance
 Each team must be below $300 by Feb 10, but there’s a catch. You need to have enough room going into the auction to be able to fill up your 25 man roster with $1 players (at minimum). A team with $298 tied up in 20 players is NOT cap compliant, since you cannot draft 5 players for $2. That team would need to get down to $295 at a minimum.
Roster Move Announcement Protocols
What follows is an example of a good format to use to announce your roster moves (these were my moves from a few years ago); it isn’t mandatory to use this exact format but it makes my job easier the more organized your email is:
Edmonton Trappers make the following roster moves:
 
FREE DROPS (not on 40 man roster):
 
Humberto Quintero
Chris Snyder
Aubrey Huff
Kelly Johnson
Mike McCoy
Brian Fuentes
Dustin Moseley
 
BUYOUTS/OPTIONS NOT PICKED UP
 
Logan Morrison $7, 3/3 so $4 cost
Michael Pineda $10, 2/3 so $10 cost
Mariano Rivera $17, 2/3 so $17 cost
 
Brett Anderson $25, OPT so $0 cost
Jason Grilli $0, OPT so $0 cost
Phil Coke $1, OPT so $0 cost
  
EXTENSIONS/RENEWALS
 
David DeJesus, $10, 1/1
Yadier Molina $23, 4/4
Tom Wilhelmsen $10, 1/1
Jarrod Parker $10, 1/3
 
The Trappers have $103 available for 8 players heading into the auction.
 I would strongly prefer you get all your roster moves in one email; however, if you make a mistake another email will be allowed under the following conditions:
  1. Buyouts and/or extensions announced in the FIRST email may NOT be revised. In other words, if you buyout someone in your first email you cannot email again and say “oops”.
  2. If you forget to buyout someone, or extend/renew someone, you MAY send another email as long as you catch the error of omission before the deadline.  Again I would PREFER all this stuff be caught and sent in one email, but I won’t punish someone for mistakenly forgetting about a player when copying/pasting or whatever (I’m sure I’ve done that before).
In summary, errors of omission may be rectified by a second email, but errors or changes of heart after you’ve made an announcement about a player buyout/extension may NOT be undone.
Regarding trades, rosters are FROZEN at the deadline for buyouts/extensions (ie Feb 10).  This is to ensure that all teams are cap compliant prior to the auction.  This is consistent with what we’ve always done so be sure to get your trade fliers out there now!  Regarding buyouts/extensions w/r/t trades, if a team has made all their announcements and then acquires a player who is still an “OPT”, they MAY extend/renew that player when announcing the deal.  Similarly, if a team has made all their announcements and then acquires someone who they wish to buyout, they may buy that player out (all of this is consistent with #1 above).  A team may NOT override the decision made by the previous owner regarding extensions (this is consistent with #2 above). So if you trade for a guy who the previous team has given a 3 year extension, you may not overrule that.
Basically the above rules make sense to me because there’s no reason to punish an owner for announcing their picks early by not allowing them to buyout someone they forgot about and/or acquired in a trade; if we took a harder line stance on that issue then teams may as well wait until right before the deadline to announce everything (and there is NOTHING wrong with that; there is no reward or reason to announce your moves at the beginning of the period. In fact I’d recommend waiting if there’s a chance you’ll be making trades during the period. If you know for sure you are done dealing, then you can feel safe in announcing moves early).
FREQUENTLY ASKED QUESTIONS
Q: “Great, my star free agent signed on January 29th according to MLB Trade Rumors. He’ll be on my team, right?”
A: Not necessarily. To set the 40 man roster player pool, I go on the MLB.com website on Feb 1st and copy/paste all 30 MLB team’s 40 man rosters. Your star player needs to be listed on there to make our player pool; in other words, the team signing him needs to formally announce the signing AND clear 40 man roster room.  Sometimes, that procedure is quick but many times (especially with large contracts) it can take as long as a week after the news of the signing leaks, since the player probably needs to take a physical, they need to finalize the details of the contract, insurance, clear 40 man roster room ,etc.
Q: “Ugh, I haven’t looked at my roster since the end of last season and I totally forgot that Joe Blow was on my team! He sucks! Am I really gonna have to buy his ass out?”
A: Probably, but if he’s bad enough to be dropped from a 40 man roster (ie to make room for a free agent signing) or not to be signed to one, he’ll be a free drop meaning you’re off the hook from buying him out.
Q: “You go through the math on an example of buying someone out in year 2 of a deal, which doesn’t save the team any money. Why the heck would anyone ever do this?”
 A: It’s obviously a matter of strategy and personal preference, but there are two main reasons you would do this: To clear a roster spot, and to not have to worry about the salary a year from now.  The roster space issue is a more compelling reason in my opinion, as I find many owners focus on clearing dollars but not so much on roster space. I remember reading many comments in the draft room from guys who have finished their draft saying “ah that guy only went for a buck!? I wish I had room for him”.
Q: “Another owner is trying to convince me to acquire a player that I believe will retire. If he retires, can I still use him?”
A: Probably not. Again, everything is driven by what the MLB.com 40 man rosters show. There is a chance though that a player may announce his retirement but not file official papers for some time afterwards; I believe this happened with Billy Wagner several years ago (I don’t recall if he ended up in our player pool but I do remember it took him a while to “officially” retire). So it’s possible (but unlikely) that a guy could announce his retirement but still show up on a team’s 40 man roster.
Q: “Another owner is trying to convince me to acquire a player that I believe will move back to Japan to play. If he ends up in Japan, can I still use him?”
A: Nope.
Q: “Ok, so I have a guy who’s a $4, OPT. I can renew him for a year at $4, or 2 years at $14. How can I renew him for only $9?”
A: You can’t. It’s a quirk in the rules; basically you get a discount on simply renewing a guy for only the current season, and after that you pay full price on the formula of adding $5 per season. It causes confusion but that’s what the official DLB rules stated so it is what it is.
Q: “If I sign my hot shot prospect option player to a 3 year deal at $10 per season, can I renew him after year 3 is over?”
A: Yes. The renewal would be at the same terms as shown in the rules for standard contracts.
Q: “If I sign my flukey minor league player to a $10, 1/1 contract, is there any way I can renew him?”
A: Nope.
Q: “Sweet, Mike C didn’t give a card to shitty Mark Blow (the even shittier brother of Joe Blow discussed above). He’s a free drop, right?”
A: Nope. Even if a guy didn’t get a card, if he makes a 40 man roster you’d still need to buy him out (or you could keep him, if you wanted).
Q: “I’m eyeing this hot shot prospect in A ball with my first prospect pick. Can I draft him?”
A: Only if he’s on an MLB team’s 40 man roster. Since he’s in A ball, he’s probably not on a 40 man roster yet; MLB teams usually don’t add prospects to the 40 man until they are close to debuting or until they have to protect them for the Rule V draft. So you don’t see many prospects in the lower levels of the minors in our prospect draft.
Q: “Hey, this guy didn’t get a card this year, shouldn’t he be in the prospect draft and not auction/minors draft eligible?”
A: If he was NEVER carded before, then yes he’d be in the prospect draft. If he was ever previously carded, he would be auction eligible regardless of whether or not he has a card this year.

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