Search the Community
Showing results for tags 'aav'.
By Robert Cunningham, Angelswin.com Senior Writer Note from Angelswin.com: Again, I am making a plea for support, to our family here at Angelswin.com, to provide any donation, even $1, to the AW.com sponsored charity-of-the-month, Hope for Education. If I have to go further, I am willing to take unnatural pictures by tdawg's bunk bed to encourage donations or, alternatively, not show them, at the whim of each individual member of the Angelswin.com family. I know times may be tough for many of you, but even a small donation helps toward a larger goal, so I am humbly requesting any kindness you can afford. Thank you for your time and attention! As we alluded to, in the Introduction article, Major League Baseball (MLB) has taken a financial hit due to the COVID-19 pandemic. Clearly the abbreviated season combined with a complete lack of in-person attendance at ballgames put a big financial hit on the game. Arte Moreno, himself, indicated revenues came in well short of projections. This financial impact is not insignificant and the likelihood that 2021 will take a similar hit is high. Why? Well, let us just talk it out here. Assuming President-elect Biden takes office on January 20th and, in a likely scenario, puts the country on a 30-60-day lockdown (or some hybrid mask requirement), that would immediately place us in early-to-late March. From there, a probable phased opening of non-critical businesses would take place, not dissimilar to what happened in 2020. Basically, a larger subset of businesses would open and the country would test the COVID-19 stress level on the population. If cases return at a rate higher than expected that would have a very negative impact on any proposed baseball season. However, if the reemergence is successful, stadium play, likely in a limited form, could potentially take place later in the year. Think, absolutely no more than 50% stadium capacity (probably less) in what would likely be another abbreviated regular season. Note this is probably the most optimistic scenario. There is a high likelihood that even if the country successfully reopens that pandemic experts and scientists will almost certainly recommend that large gatherings do not occur within a several month period, even after a clean societal reemergence. The bottom line is that 2022 will be financially rocky for the country and MLB, which will almost certainly result in low to medium attendance, at best, and possibly another shortened baseball season, based on what MLB decides, and is even allowed to do, in a continuing COVID-19 pandemic environment. It could be a 162-game, televised-only, season or some mashup of televised-only and in-person attendance games, ranging anywhere above 60 games. Basically more significant financial impacts to baseball, which brings us to the Los Angeles Angels financial situation. Here is a rough snapshot of the projected Angels 2021 payroll situation as of December 7th, 2020: Table 1 - 2021 Los Angeles Angels Projected Payroll The Angels current Average Annual Value (AAV) payroll sits at about $181M, which is $29M below the Competitive Balance Tax (CBT) threshold of $210M for 2021. This is in-line with what FanGraphs RosterResource.com and Spotrac.com show, as well. The arbitration salaries, in Table 1, were pulled, as usual, from MLBTradeRumors.com yearly Projected Arbitration Salaries for 2021 series, this year utilizing Method #3 numbers. Does this mean the Angels can spend $29M? Based on the current economic environment in baseball and the likelihood of another COVID-19-impacted season, the answer may be no. First of all most teams keep some sort of reserve cushion of payroll space to start off each season in order to maintain flexibility heading into the Trade Deadline. For the Halos that will likely be about $10M or so, automatically lowering their available payroll space down to $19M. Moreno’s history shows a trend of modest payroll increases year-to-year, keeping pace with a rising CBT threshold but nothing more or less. During new GM Perry Minasian’s live interview at Angels stadium, Arte did clearly state payroll would not go down, but offered little more. Based on this we will presume the Angels have $19M to spend this off-season for the purposes of the Primer Series, possibly more if the Angels target one or more of Moreno’s aforementioned “impact” players. Also you can clearly interpret the Angels recent non-tender of several Angels relievers as a sign the Angels will probably be fiscally conservative in 2021, based on the notable impacts to the U.S. economy and MLB. The trade for Jose Iglesias, as an addition by subtraction scenario, in conjunction with the Halos moves to kick Hansel Robles, Matt Andriese, Justin Anderson, Keynan Middleton, and Hoby Milner to the curb, will keep the payroll effectively neutral. As a lone counterpoint, the Angels, just today, executed a trade for RP Raisel Iglesias, who is slated to receive $9.125M in 2020, adding a substantial amount to the payroll, reducing the total projected available payroll space by about 25%. It is not just the Angels, either, as evidenced by the Indians placing Brad Hand on waivers (and subsequently releasing him), the Reds trading Raisel Iglesias to the Halos, and the apparent financially-strapped Phillies rumored to be shopping Zack Wheeler. Even perfectly viable free agents that you would expect to pursue multi-year deals, such as Robbie Ray, Drew Smyly, Marcus Stroman, and Kevin Gausman, have selected one-year deals and/or accepted the Qualifying Offer, rather than test a clearly weak free agent market for players. This simply means that the Halos are likely to stay within a tight range of $19M. Certainly, Arte can choose to go up or down but, again, history does not support the notion of a spending spree and internal and external economic factors make it much less likely to happen. As much as this off-season might be a prime opportunity for Moreno to exercise the teams financial muscle for a short 1-2 year period, this year is proving to be the most unlikely year in recent history for him to do it. Only time will tell the tale. One final note regarding MLB and financial expenditures. Despite the clear hits teams are taking due to the pandemic shutdown, there appears to be a collective move by MLB and the owners to take advantage of the situation, making deep cuts to Minor League Baseball (MiLB) team franchises, effectively depressing 2021 arbitration and free agent salaries via these declarations of being in a financial crunch, and cutting out wide swaths of front office personnel and MiLB players. As an outsider looking in, this seems, to me, to be a self-destructive attitude in a business that makes so much money according to Forbes and other publications. Clearly local revenues, which are a main contributor to individual team revenues, have taken a hit due to non-existent ticket sales in a shortened season but the extensive cuts feel deeper than needed. When you look at the numbers it is clear that not playing a full regular season with no ticket sales does result in large losses. However, a full regular season with, perhaps, at least 40% of a typical season’s in-person attendance would bring MLB, as a whole, to a break-even level, give or take. The point is that the latter (40% in-person attendance) is probably a less likely scenario based on our earlier discussion, thus MLB will probably struggle again in 2021 and the owners, even in the face of a fight with the Player’s Union, will probably look to make additional cuts when and where they want and can. The near-future of MLB is not particularly bright, so let’s hope cooler heads prevail and a compromise can be reached, not only in entertaining, at least, a full or partial, televised-only regular season, but also with a new Collective Bargaining Agreement (CBA) and continued baseball for the next several seasons. MLB’s image is teetering on a tightrope with little room for error so they need to get this right.
By Robert Cunningham, Angelswin.com Senior Writer As the Angels enter the 2019-2020 off-season, Billy Eppler is faced with the daunting task of taking Moreno's proposed increase in team payroll and creating a contending club out of the available resource pool. Currently, the Angels 40-man roster stands at 40 players as of November 28th, 2019. In order to begin the discussion about available finances, the author has examined the Angels 40-man roster and assuming the Angels retain the current set of 40 players and use MLBTradeRumors.com's estimated arbitration salaries, 2020 Club Payroll will be approximately $162M and Actual Club Payroll (Average Annual Value (AAV) payroll) will be approximately $151M as seen below: A couple of notes regarding the table above: Injured List $$ indicates a nominal number for MLB players that spend time on the Injured List and is an educated guess based on information provided by the Orange County Register's Jeff Fletcher. Payouts refers to any and all money expended on players no longer on the 40-man roster. In this case the $1M number was Kole Calhoun's option year buyout. Subtract Non-Roster is simply the 14 players not on the 26-man roster making League-minimum salaries that do not count toward the total payroll numbers. In this case 14 x $600K = $8.4M Benefits refers to Player Benefit Costs and is an educated guess (also based on information provided by Jeff Fletcher) on how much every team pays toward that fund. Below is the relevant excerpt of the Collective Bargaining Agreement that shows how it is applied to the payroll calculation: To be clear this estimate is exactly that, an educated guess. The only difference between '2020 Club Payroll' and 'Actual Club Payroll' is that in the latter you are accounting for the multi-year guaranteed contracts (average annual value of them) and how close that places the team to the Competitive Balance Tax (CBT) threshold for that season (in this case $208M for 2020). So Eppler starts the season with approximately $147M in 2020 Club Payroll and $136M in Actual Club Payroll (AAV) and when you adjust for Player Benefits, non-roster players, Injury List (IL) payout estimates and Calhoun's $1M option buyout, the Angels start the season at $162M (2020 Club Payroll) and $151M (Actual Club Payroll). This means that, based on Moreno's own words about raising 2020 Club Payroll, the team probably has at least $25M+ to spend in free agency and trade and likely that number is closer $30M-$40, if not more. Fortunately, because of this, the Halos have more options this off-season in terms of money and resources (both MLB-ready players, farm prospects, and International Signing money) to address their needs and create better depth across the roster. If the Angels really are courting Gerrit Cole (and they should be), he will likely get the Angels close to their spending limit all by himself on a back loaded contract. In order to make other moves, Eppler will have to get creative in the trade market as well as executing savvy low-level free agent signings to fill in the rest of the roster. This may require Moreno to get awfully close to, or even exceed, the Luxury Tax threshold of $208M, although the team will likely stay under that number, barring a truly unexpected all-in over the next two seasons (a precise window they can escape by the way once Pujols contract expires after 2021). Expectations are high for Eppler to create a winner in his current, last year as General Manager so Angelswin.com members and fans should expect at least one large free agent signing with perhaps 1-3 lower-level pickups. In addition to that it will not be surprising to see 1-3 trades executed to bring in additional pitching and positional needs. All of this will be covered further as we dive deeper into the 2020 Angelswin.com Primer Series!