Sunday, December 05, 2004

The Arbitration Situation

"Be just and if you can't be just, be arbitrary." – William S Burroughs

On Tuesday, December 7, the Cardinals have to decide if they will be offering arbitration to their nine free agents. I have a feeling we should be arbitrary in several of these cases, rather than just. (Especially if ‘just’ means four years and $40M for Edgar.) Arbitration is one of those tricky baseball off-season events that has many different rules and procedures. I don’t have the qualifications to truly interpret all of the intricacies, but that’s never stopped me before from pretending that I know what I’m talking about. I’ve borrowed most of this information from other sites, mainly Cardinals mega-board Birds on the Bat as well as Baseball Primer.

Here goes nothing:

There are two types of arbitration in baseball. One involves a grievance being filed by a player when they feel that the Collective Bargaining Agreement has been violated. This isn’t as common and we’re not going to talk about it here.

The other type of arbitration is the kind we’re concerned with, and it comes in two forms. The first is used to insure that young players not having qualified for free agency and thus still controlled by the franchise are able to receive increased compensation based upon their performance. Jason Marquis will be eligible for this type of arbitration this year. This is the type of arbitration that the Cardinals opted out of last year with Albert Pujols, instead choosing to sign him to a long-term contract before they were required to do so.

The other form is that which is offered to the players that are eligible for free agency. The Cardinals have nine such players in 2004.

The club must offer its free agents arbitration on or before December 7, and players must decide if they are going to accept it by December 19. If the player declines the offer to go to arbitration, the team cannot negotiate with the player from January 8 to May 1.

If a free agent is not offered arbitration by his team, the team does not receive any compensation in the event some other team signs him. If the free agent is offered arbitration and is signed by another team, the team losing the free agent is eligible to receive compensation from the signing team by way of draft picks.

If the player is offered arbitration and he accepts it, the case goes before a panel of arbiters.

That panel is then presented two compensation figures, one from each the player and team. The arbiters then hear arguments from both sides on which figure is the most appropriate for the next season. The number ultimately agreed upon is considered compensation for a one-year contract.

Still with me?

The panel is supposed to consider variables such as the player’s contributions to the team in the previous season (which can range from ‘leadership’ to actual performance), career performance, past contracts, contracts of comparable players, mental stability, physical health, and stance on drilling in the Alaska National Wildlife Refuge.

After the arguments are made, the panel must choose either the team or the player figure. They are not permitted to come up with their own number that balances out the two submitted amounts. The idea is to encourage the two parties to come up with reasonable (cough, gag) figures. If the team significantly low-balls the player, they run the risk of paying the player’s asking price--and vice versa.

This 50-50 risk that faces players and management alike typically drives them to make a deal.

One more thought. The Elias Sports Bureau releases rankings of all baseball players at the end of every season and these rankings are used to determine compensation for the teams that ‘lose’ their free agents. Players fall into four classes within their position; A, B, C, and ‘not worth the clothes he’s wearing’. Which class they fall into determines the potential draft pick compensation that ‘losing’ teams will receive in the event of the free agent’s departure.

Class A free agents are good for the first round pick of the signing team and a supplemental pick, which occurs between the first and second rounds. (So, if, say, Steve Kline goes to a team like, say, the Yankees, the Cards get the Yanks’ first round pick in addition to their own. And they also get a bonus pick in-between rounds one and two.) Class B free agents don’t land the supplemental pick. Class C players only land a supplemental pick between Rounds 2 and 3. The last group of guys in the Fourth Estate is relegated to mopping floors and fetching Budweiser for the upper crusts.

It gets plenty more complicated, (say if a team goes Free-Agent-Wild and signs several hired guns, they don’t have multiple first rounders to give up…) but we’ll boil it down to something simple: Losing a free agent that has been offered arbitration means more draft picks, no matter how you slice it. It can be a good tool to help re-stock the farm system quickly.

Below I’ve compiled a list of the Cardinals’ 9 Free Agents and included information about what type of free agent they are, how much money they made the previous year (rules of arbitration dictate that players can only be forced to take a slight pay cut) and a little commentary. Information came from Dugout Dollars and Mlb.com.

Cal Eldred – Type A, 37th ranked reliever
1 year, $900K

I’m still trying to figure out how Big Cal is considered Grade A Angus. Tony likes Cal as a person and as a competitor (but evidently not as a trusted reliever, noting 2004 postseason usage). They should offer him arbitration under one condition—he agrees to never accept it. We don’t need to spend $1M on a long reliever who isn’t getting any better. Would he do this for us? Chuck Finley did after the 2002 season. But as mothers everywhere would ask, if Chuck Finley would jump off of the Eads Bridge would you?

Kliner – Type A, 26th ranked reliever
1 year, $1.7M

Kline certainly earned his ranking in the top reliever tier. He’s insane. He’s overweight. He has finger problems. (Not that finger.) Oh yeah, and lefties can’t hit a lick off of him. (143/263/190--Wow.) It has been rumored that George Steinbrenner wants to add him to his Zoo in the Bronx. While I’d hate to see Kline go, we ought to take advantage of getting a few draft picks for him. Sidebar: Steve Kline was once the elected players union rep for the club. Does anyone else find this farcical?

Ray-Ray – No compensation
1 year, $650K

Ray Lankford made a strong case for being Mr. Cardinal of the 1990’s. People often forget his good years with the team, beginning as an athletic, speedy centerfielder with some pop, and then his transition to perhaps their best overall player on the team for most of the decade. (He was there all 10 years.) He will go down as the all-time HR leader at Busch Stadium. Thanks for the memories, Ray. I can’t say ‘arbitration’ but I can say ‘personal services contract’.

Mabry – Type C
1 year, $600K

Offering Mabry arbitration would be foolish. Signing him to another one-year deal for the bench is another story. That can be figured out later. Don’t call us, John. We’ll call you.

Matheny – Type A, 7th ranked catcher
3 year, $8.75M (2.5, 3.5, 2.75)

Tough call. I’d offer it, with the hopes he either signs the one-year deal we’ve been offering him or goes elsewhere. But if he doesn’t do either of these things, he’ll have to accept the arbitration. He’ll likely request $5M in those hearings (gold glove, gold heart, golden leader) and the team will counter with $2Mish (no bat…uhhh…too nice?). Risky, but roll the dice and hope you can make a deal for some Yaddy-tutoring.

Edgar – Type A, 1st ranked shortstop
4 years, $20M; (7.5 in 2004)

It’s a risk, because if it goes to arbitration, he stands a chance of winning a $10-12M judgment. But it’s a calculated risk, and the team needs the time it’ll buy them to continue to negotiate. What happens if he can’t find a deal to his liking, with the Cards or someone else? Walt Jocketty will have to employ the “Edgar Renteria, besides being mentally unsound and of foul odor, curses at nuns and kicks little puppies” defense, in hopes to convince arbiters that he isn’t worth what his agent is asking.

Woody – Type A, 16th ranked starting pitcher
$6M in 2003; $8M in 2004

Gregory, you’re a nice guy. Enjoy the winter with your family. If you’ve got the itch come springtime, give us a call in February and we’ll see if a ‘veteran leader’ contract is available. (This would most likely happen if the spring reports we hear are ‘Carpenter Still Unsure of Injury’, ‘Haren May Not Be Ready’, and ‘Ankiel Hits Mascot With Errant Fastball’)

Tony Womack – Type C
1 year, $500K

Whether or not Tony Womack should be on the roster in 2005 is a story for another day. All we need to know for December 7 is that he shouldn’t get there by arbitration. I say that because I’m afraid it means the team will end up retaining his services—and I don’t think T-Dub can hit those same numbers again next year. According to Joe Strauss, the team is leaning towards a Womackian Encore.

Morris – Type A, 18th ranked starting pitcher
3 years, $27M (4-10.5-12.5)

Morris has an agent now. If the Cards are foolish enough to offer him a chance at a one-year deal worth $10M guaranteed, they deserve to pay it. But they’re not that foolish, and every indication is that they’re not even considering the arbitration route.

If the front office follows the above plan, they could land up to 8 draft picks towards the top of the 2005 draft. Some teams are moving towards a strategy of giving up their top round draft positions (ahem, SF), citing exorbitant sums going to players that often don’t make it to the Bigs. The Cardinals shouldn’t choose this model. It’s lazy management, essentially saying: “We aren’t smart enough to make good decisions, so we’ll just avoid having to make them at all.”

Instead they should look into using those draft picks in a more efficient manner. (Jeff Luhnow, are you there?) After all, no one put a gun to our heads to choose the Shawn Boyds, Cal Hayes, and Justin Popes of the baseball world. And if the Cards are going to have reasons to celebrate in their new shiny yard, they’ll need a little help from the low-cost kids. They probably won’t get all of those draft picks, but something is better than nothing.

Posted by David @ 3:57 PM 1 comments

1 Comments:

At 12/06/2004 6:04 PM, Blogger Fitz said...

great site so far guys, its my new cards blog.

 

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