Hidden Vigorish

Detailed Analysis of The Pittsburgh Pirates

Month – January 2016

Pirates Off-season Spending and the Curious Overemphasis on the Bullpen

Last week the Pirates wrapped up one of the last formalities of the off-season by settling the contracts of all their arbitration eligible players. There are still a few more weeks left before the team commences with Spring Training. Perhaps GM Neal Huntington will make another addition to the club before then. But in all likelihood the opening day payroll of the club looks to be set just short of $100 million. 18 players on the roster will earn salaries of $2 million or more in 2016. They combine to account for $93 million of the club’s major league payroll. Filling out the 25 man roster with near minimum salaried pre-arbitration players pushes the payroll to about $97 million to start the season. That is slightly higher than the payroll at the end of last season, and represents a bump of about $9 million over the start of 2015. Given their history of making in season additions over the past 4 seasons it is safe to speculate Neal Huntington has another $5M to $10M of maneuverability left with the payroll. So a 2016 payroll budget of $105 million sounds about right. There are certainly good arguments to be made for why Pirates Owner Bob Nutting should be giving his General Manager even more financial resources. But that is not the purpose of this post. Instead of criticizing the club for how much they should be spending I am going to criticize them for what they actually are spending for.
The club took a big hit this winter from a certain segment of the fan base that likes to call the Pirates cheap. It was basically two moves that drew their ire. The first was not retaining J.A. Happ (or not signing a comparable mid-rotation pitcher to replace him). Happ signed with Toronto for a 3 year deal worth $36 million. Toronto may have slightly overpaid for Happ, but $12 million per annum for Happ is not exorbitant by any means. The second move that got the fan base rankled was dealing hometown boy and fan favorite Neil Walker to the Mets in exchange for Left handed starting pitcher Jon Niese. Both of these decisions were viewed as the Pirates choosing to cut costs over building a championship. But in reality Neal Huntington had more than enough money in the budget to retain Walker and resign Happ. The Walker for Niese swap was very nearly an even money trade. Jon Niese is set to earn $9 million this coming season. Walker is estimated to earn about $10.5 million in his final year of the arbitration. Yes, we can chalk this move up as a slight savings for the Bucs. But it is a savings that easily could have been accounted for just by the amount of money Huntington chose to commit to free agent signings. All told Neal Huntington spent $21 million on free agent signings this winter, $17 million of which applies to the 2016 payroll. That is enough to cover the slight savings that was actualized by dealing Walker, as well as the $12 million in salary that Happ will earn in 2016. So these moves that were criticized by the fan base as cost cutting measures were far more about budget allocation than the actual size of the budget.
Of course it is not fair to criticize what the club chose not to spend on without considering what they did spend on. This is where the plan of the front office this off-season really breaks down for me. Of all the signings the team made I see just one upgrade – John Jaso to replace Pedro Alvarez as the left handed hitter in the 1B platoon. Jaso lacks Alvarez’s power, but Jaso is still an overall better hitter than Alvarez. And although Jaso lacks much experience defensively at 1B he can’t possibly be as bad of a defender as Pedro who was downright awful with the glove. So I’m a big fan of the Jaso acquisition and his $4 million salary. But the rest of the free agent pickups and the more than $12 million committed to them in 2016 leaves me shaking my head. The club chose to commit $7 million combined to a pair of relievers in Juan Nicasio and Neftali Feliz. Those are odd signings for a team that never spends on middle relief and usually does a great job of finding quality middle relievers for league minimum salaries. Then another $2 million was spent on Ryan Vogelsong who is a quintessential 5th starter. Add another $2.5 million to bring back Sean Rodriguez and another $1 million guaranteed salary in Major League contracts to a pair of AAAA players that are just org depth and probably won’t even make the roster (Trey Haley and Jake Goebbert). I am confused why Neal Huntington would pay so much for all these bit parts. These are the kind of roles that should be filled by cheap talent in the system and Spring Training Invitees that prove to be bargain bin finds. And I am especially confused by the allocation of the budget on the bullpen. The team already had a significant portion of the payroll tied up with relievers Mark Melancon, Tony Watson, and Jared Hughes. Adding Nicasio and Feliz means that $22 million (nearly a quarter of the payroll) is being allocated to just 5 relief pitchers. So either Nicasio and Feliz are being pegged for bigger roles which means other changes could be imminent (like a Melancon trade) or the front office is less bullish on their ability to back fill the bullpen with cheap talent going forward. Either way this off-season doesn’t sit right with me. I feel it would have been far more prudent to keep Neil Walker and sign a mid-rotation starting pitcher instead of committing so much cash to the bullpen to cover for the inadequacies of the rotation.

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