Brewers deferred payments

I’ve been coming out with period payroll projections this winter and Aramis Ramirez’s 2014 is a common point of confusion, and sometimes contention, for people.  I don’t blame anyone as contracts can often be convoluted and information difficult to find.  His total salary is technically $16 million, but $6 million of that is deferred to a later date.  This got me wondering about the other players with deferred salary and I thought I’d share what I found.

As discussed above, Ramirez’s 2014 salary stipulates $6 million is deferred.  I use Cot’sContracts for most of my salary information.  Sometimes I'll check B-Ref, but that's only for confirmation if something is called into question.  Neither of these sites listed when or in what quantities the deferred payments were to be made.  It was only by chance that I stumbled upon this article and learned $3M will be paid in 2017 and the other $3 million in 2018.

Ryan Braun’s contract stipulates “$18 million in salary (4 million each in 2016-18 and $3 million each in 2019-20) deferred without interest, to be paid in equal installments each July 1 from 2022 to 2031.”  In other words, the Brewers are to pay Braun $1.8 million over the course of ten years.  Those payments begin the year after Braun’s final option year.  He's also owed $10 million  from a signing bonus.  That's to be paid in equal installments over 4 years, the last two of which are 2014 and 2015.  That's $2.5 million each year.

Kyle Lohse is the other player whose contract includes deferred salary.  Seven million dollars of his 2013 salary is deferred, to be paid over the years of 2016-2018.  If it’s like Ramirez and Braun’s deferred payments, it’ll be in equal installments.  That’s $2,333,333 for 3 years.

Ramirez’s deferred payments will overlap with the last 2 years of Lohse’s deferred payments.  Assuming I’m correct about the structure of Lohse’s payments, the Brewers will then owe $5.33 million in 2017 and 2018.  It’s possible that could end up being a significant or prohibitive figure.  I don’t think it actually will be, but ownership could easily point to that as a public rationalization not to spend.  Braun’s deferred payments (2022-2031) should not have any real impact on future payroll.

-All salary information in this article comes from Cot's Contract's Brewers page.

Updated roster projection included Reynolds; Estrada & Francisco agree to contracts

This weeks the Brewers signed Mark Reynolds to a minor league contract that is worth as much $2.5 million after incentives.  Despite it being a minor league deal I'm going to include him here because I'm quite certain he will be on the opening day roster.  The Brewers were also able to avoid arbitration with Marco Estrada and Juan Francisco.  In my opinion that leaves one roster spot open in the bullpen.  It's possible they decide to bring in two free agent relievers, but I think it's unlikely.  Here is my roster prediction:

C: Jonathan Lucroy ($2 MM)	BN: Martin Maldonado ($500 k)*
1B: Mark Reynolds ($2.5 MM)	BN: Juan Francisco ($1.35 MM)****
2B: Scooter Gennett ($500 k)*	BN: Rickie Weeks ($11 MM)
3B: Aramis Ramirez ($10 MM)	BN: Jeff Bianchi ($500 k)*
SS: Jean Segura ($500 k)*
LF: Khris Davis ($500 k)*
CF: Carlos Gomez ($7 MM)	OF: Logan Schafer ($500 k)*
RF: Ryan Braun ($12.5 MM)

SP: Kyle Lohse ($11 MM)	RP: Jim Henderson ($500 k)*
SP: Yovani Gallardo ($11.5 MM)	RP: Brandon Kintzler ($500 k)*
SP: Wily Peralta ($500 K)*	RP: Tom Gorzelanny ($2.8 MM)
SP: Marco Estrada ($3.425 MM)***	RP: Rob Wooten ($500 k)*
SP: Tyler Thornburg ($500 k)*	RP: Donovan Hand ($500 k)*
	RP: Will Smith ($500k)* RP: Free Agent

Unless otherwise noted, all figures come from Cots Contracts.

*League minimum is $500k. Actual salaries could be marginally higher.
** Reynolds' contract is for a $2 million guaranteed base with another $500,000 possible with incentives.
***Estrada's base salary is reportedly $3.325 and includes $100,000 in incentives.
****Francisco's contracts reportedly contains performance bonuses that are as yet unkown.

As I have it here, the total payroll with 1 open roster spot comes to approximately $81.575 million dollars.

Brewers sign Mark Reynolds

                Today the Brewers signed 1B/3B Mark Reynolds to a minor league deal with an invite to spring training.  If he makes the team he’ll earn $2 million with a chance at another $500,000 from incentives.  Regardless of what you think of him, that’s pretty darn cheap.  My impression is they signed him to a minor league deal simply as a way to keep a spot open on the 40-man roster.  I’m pretty confident that he’ll be on the opening day roster.  They’re still looking for a reliever and probably want to wait as long as possible before DFA’ing someone off the roster.  If they end up trading Rickie Weeks they might not have to do that at all.

                Reynolds is a prime example of a three true outcome player.  He’s either going to strikeout, hit a home run, or draw a walk.  A lot of people are going to unjustly claim he’s awful because of his strikeouts.  Don’t be one of them.  He could very well be awful.  He does have contact issues.  But strikeouts don’t necessarily mean a player is worthless.  When he hits, it’s for a ton of power.  He also has some on-base skills.  Last year wasn’t good, but he owns a career .329 OBP.  It’s not great, but you can play with that, especially when you’re hitting 25 home runs.  He doesn’t have huge splits, but he does handle LHP better than RHP.  That would fit in a platoon with Juan Francisco if the Brewers want to go in that direction.  Reynolds’ defense leaves a lot to be desired, but he’s better at first base than third base.  Playing bad defense, however, is worlds away from not being able to play there at all.  He’ll provide additional depth in case Aramis Ramirez gets hurt again.  He could also help make Ramirez more expendable at the deadline should the Brewers look to move him. 

                I like this signing.  Forget about the minor league aspect.  It’s a formality.  He’s going to be the starting first baseman.  I might be more pumped about a platoon with Francisco, but I don’t think that’s their plan.  The option is there though.  They’re only paying Reynolds to be a little less than a 0.5 win player which is not a high bar.  I really don’t see any way this could be bad for the Brewers.  Even if he’s awful, which I think is unlikely, they could cut him and be out very little money.  At this point in the winter I’m not sure they could have done too much better.

What's worse than Clark?

Recently the Chicago Cubs, to the abject horror of anyone who was taught about stranger danger, unveiled their new mascot Clark the cub, or Clark Cub, Cub Clark.  I don't really know which it is.  I do know it's hilariously awful.  Take a look at this terrifying scene:

Photo courtesy of CBS

It's so bad that when the Cubs are killing it in the NL Central a few years from now I'll still take solace in the fact that at least Clark isn't the Brewers' mascot.  And that got me thinking.  Is there anything worse than Clark?  So I now introduce you to The Book of Gorman's new recurring series: "What's worse than Clark?"  Here we'll compare and contrast Clark with some other awful thing and let you decide what's worse than Clark.

Clark is up against some stiff competition in our inaugural installment: The Marlins Home Run Sculpture.

Photo courtesy of BusinessInsider.com

The Marlins are a wasteland of a baseball team.  Their owner is the worst in the major leagues.  He's already, at least partially, to blame for running the Expos into the ground.  Even still, the worst thing about them may very well be the home run sculpture.  It's supposed to be a tribute to the Cuban culture in Miami.  I don't know how the Cuban community feels about it, but I think it's an eyesore.  It also cost $2.5 million which was more than the Marlins individually paid 22 players on their 25-man roster.  When a Brewers player hits a home run they shoot off the most depressing looking fireworks and Bernie goes down the slide.  It's a little silly, but it's unobtrusive.  If I want to ignore it, I can.  When a Marlin hits a home run this happens:

So there you have it.  The choice is now in your hands.  Let me know, either in the comments or on Twitter if you think the Marlins home run sculpture is worse than this:

Photo courtesy of Independent.co.uk

Where is the money going?

In 2012 the Brewers pushed their opening day payroll over the $100 million mark for the first time ever.  By the end of the season, after trades, they ended up committing a total of approximately $98 million.  It has been claimed that they lost several million dollars that season.  Whether that means they actually operated in the red or just didn’t make as much money as expected is up for debate.  Regardless, the Brewers scaled back the payroll in 2013 to a little under $89 million in order to make up for some of the losses.  I happen to think it was a prudent move.  I agreed with it despite the fact that they were to receive an additional $9 million (approximately) from their unfortunately awful local TV contract.  We shouldn’t expect them to use all that money for roster construction, but theoretically some could go towards it.  From all this, one can infer several things:

1. Prior to the increased local TV revenue, $98 million was several million over what the Brewers could spend and just break even.

2. Prior to the increased local TV revenue the Brewers could break even by operating somewhere around $92-94 million (several million below the $98 million spent in 2012). 

3. After increased local TV revenue is factored in the Brewers could break-even by operating somewhere over $92-94 million (or in other words, some millions more than several million below the $98 million spent in 2012).

I’ll also note that each club will begin receiving an additional $26 million dollars in 2014 from National TV contracts.  I’ll have more to say on this later.

Judging by the moves the Brewers have not made (e.g. not trading players to enter a rebuild phase) one has to assume the plan is to compete in 2014.  It’s possible that they could explore selling players at the trade deadline.  That is, however, less of a plan than a lack thereof.  For the sake of argument, I’m going to assume the plan is to compete.  The question then becomes what areas are in need of improvement?  One could argue that the rotation is weak and the bullpen needs bolstering.  I would say, even though they may not be exceptional pitchers, the 5 rotation spots can be filled in house and the bullpen is less important.   It is my assertion that the only glaring need is first base. 

Let’s go back to the money side of things for a moment.  Above I have inferred that $92-94 million was approximately the point at which the Brewers could operate without losing money.  This is before factoring increased revenue ($35 million) from local and national TV contracts.  It’s impractical to ask the Brewers to commit that full sum to the payroll, but I think it’s fair to say that they could commit as much as $10 million of it if not more (The rest of the TV money would go to things like the first year player draft, international signings, and improving facilities and various programs throughout the franchise).  Let's hedge our bets and say that before factoring the national TV revenue, the Brewers payroll limit was $92 million.  After factoring the new national TV money the Brewers current payroll limit is, very conservatively, $102 million dollars.  I have previously estimated the Brewers payroll to be $80.2 million with two open roster spots for a first baseman and a reliever.  That means the Brewers could theoretically spend as much as almost $22 million for those last two spots.

I’m not saying the Brewers should spend all that money for the sake of spending it.  I’m not saying they should be spending $100 million annually.  I’m certainly not saying they can compete with other clubs for elite free agents nor do I think they should try.  I understand the desire to stay away from long term deals and I agree with that in general.  I understand why they didn’t want to give James Loney something like 3 years and $27 million.  That is all the quarter I'll give them, though, because I don’t understand why they were unwilling to offer Corey Hart the deal Seattle did.  And I am absolutely saying I reject the notion that they could not afford it.  Anyone that tells you that is either lying or misinformed.  They have more than enough money.  In point of fact they have over $8 million more than enough.  I understand the risk associated with his knees but that risk is mitigated by limiting the deal to one year and making it incentive based.  Hart was a better option than anything now left to the Brewers.  He was a step closer towards legitimate contention, and also offered the ability to trade him mid-season, but that’s another conversation.  The point is they have money to spend but were unwilling to spend it on the one thing they need most in a year in which they claim their goal is to contend.  By doing they so arguably left themselves worse off.

I have many questions for the Brewers.  But for right now, the one foremost on my mind is this: If they are unwilling to spend the money they have on the one area they need most, where exactly is that money going?

The latest roster and payroll projections

The one is going to be short and, well, bitter.  The Brewers did not sign Corey Hart as I had prognosticated and they did not sign James Loney as I had advocated.  In point of fact, they have not signed anyone...at all.  The trade talks with the Mets over Ike Davis have gone nowhere, thankfully, and it doesn't look like there are any other possibilities on the trade market.  Michael Young was a name that came up, but as of yet that seems to have gone nowhere.  For right now, it seems more likely than before that the Brewers will fill from with-in.  I do expect them to sign someone for the pen, maybe two someones.  I think it's likely they do get another position player too, but maybe someone for depth instead of a starter.  But hey, what do I know?  Anyway, here is how I see the roster playing out as of right now.

C: Jonathan Lucroy ($2 MM)	BN: Martin Maldonado ($500 k)*
1B: Juan Francisco ($1.4 MM)**	BN: Free agent.
2B: Scooter Gennett ($500 k)*	BN: Rickie Weeks ($11 MM)
3B: Aramis Ramirez ($10 MM)	BN: Jeff Bianchi ($500 k)*
SS: Jean Segura ($500 k)*
LF: Khris Davis ($500 k)*
CF: Carlos Gomez ($7 MM)	OF: Logan Schafer ($500 k)*
RF: Ryan Braun ($12.5 MM)

SP: Kyle Lohse ($11 MM)	RP: Jim Henderson ($500 k)*
SP: Yovani Gallardo ($11.5 MM)	RP: Brandon Kintzler ($500 k)*
SP: Wily Peralta ($500 K)*	RP: Tom Gorzelanny ($2.8 MM)
SP: Marco Estrada ($3.5 MM)**	RP: Rob Wooten ($500 k)*
SP: Tyler Thornburg ($500 k)*	RP: Donovan Hand ($500 k)*
	RP: Will Smith ($500k)* RP: Free Agent

Unless otherwise noted, all figures come from Cots Contracts.

*League minimum

**Arbitration projections from MLB Trade Rumors

With two open roster spots for bench/first base and the bullpen, I estimate the the payroll to be $80.2 million.  If they were to fill the final two spots from with-in the payroll total would come to $81.2 million.  For reference (also from Cots), the Brewers spent $88,828,333 in 2013 and in $98,150,833 in 2012.

Hunter Morris is not the answer

                With Corey Hart, James Loney, and Logan Morrison off the market the options are running out for the Brewers open spot at first base.  Ike Davis seems to be their top target as of right now, but Justin Smoak, Mitch Moreland, Adam Lind, and Mike Carp are also probably available should the Pirates be able to snipe Davis.  None of these players are slam dunks and each one will cost a player in to acquire.  That has led some people to wonder why Hunter Morris isn’t in play.  The answer is really quite simple if you look past his “2012 Brewers Minor League Player of the Year” season.

                I won’t take that away from him though.  He was pretty good in 2012 at Double-A Huntsville.  He hit 301/357/563 with 28 home runs.  So yeah, if that’s all you’re looking at it seems confusing that he isn’t being talked about more.  Unfortunately for Morris, the Brewers are aware of his contributions before and after that season.  Take a look:

2010 (A):             251/306/436

2011 (A+)*          277/299/461

2013 (AAA) :       247/301/457

*He did get promoted to AA in 2011 but he only played 4 games (17 plate appearances) so I didn’t include those stats.

Another thing to consider: BABIP (batting average on balls in play)

2010:  286

2011:  289 (again not including the 17 PAs at AA)

2012:  342

2013: 280

That 2012 BABIP is so far out of line it’s simply unsustainable.  This is evidenced by a return to the norm in 2013.  The power is real, I'll give him that, but that 2012 "breakout" is an illusion.  This is why Hunter Morris is not being seriously considered.

              I hear a lot people say that if he isn’t ready now at 25, he’ll never be ready.  There is no logic in that assertion.  Morris is below replacement level player right now so why would you want to put him on the Brewers 25 man roster anyway?  Because he’s getting older?  That’s no argument.  Some people take longer to develop.  Morris was just added to the 40-man roster this offseason so he has all 3 options remaining.  That means the Brewers can let him develop for three more seasons if they really wanted to and he clearly needs that time.  I’m sure we’ll see him in Milwaukee at some point this season but it may not be until September.  His performance in 2014 will tell us a lot about his future, but a lot will also depend on who the Brewers do get to play first base.